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A progressive tax rate would only tax 1 dollar at 50%. I say this because you saying $400,001 makes me think you believe that all your income will be taxed at

A progressive tax rate would only tax 1 dollar at 50%. I say this because you saying $400,001 makes me think you believe that all your income will be taxed at the highest bracket once you just barely cross into it. It's a common misunderstanding, but that's not how progressive taxes work. I'm also assuming that $400,000 is the tax bracket threshold, since that is what some politicians have proposed, and I think that's what you were alluding to.

Racing0461 3y ago
> effective tax rate for a doctor earning $400,000 in Quebec canada > Based on the 2023 tax brackets you provided, the effective tax rate for a doctor earning $400,000 in Quebec would be approximately 45.03%. This assumes no other deductions, credits, or tax strategies are applied. It makes me think that because that's what the ultimate end goal the progressives are planning here in the usa. tbh if that ever ends up being my effective tax rate (ie total taxes paid divided by total income), i would literally stop working out of pure principle.
- smileysteve 3y ago
  Weird because nobody quit working during the 50s-86 out of principle when top federal marginal rates were between 90% and 50%.
  - flangola7 3y ago
    The arguments against strong marginal tax rates are not made in good faith. They're very consciously crafted by the rich.
  - leereeves 3y ago
    How can you possibly claim that "nobody quit working during the 50s-86 out of principle"? Lots of people retired early during that time (like any other time) and you don't know what all of their motives were.
    - anon25783 3y ago
      Let's revise the claim, since you want to be pedantic: "Very few people, if any, quit working during the 50s-86 in protest of the high marginal tax rate".
      - leereeves 3y ago
        And do you have some evidence for that revised claim?
  - mc32 3y ago
    That rate was in principle but hardly anyone paid the top rate and indeed spurred tax avoidance tactics: https://taxfoundation.org/data/all/federal/taxes-on-the-rich-1950s-not-high/ https://taxfoundation.org/data/all/federal/taxes-on-the-rich... So people didn't "quit working" but people earning over 200K (~2MM today) did start looking at ways to avoid having to pay those taxes and the net effect was that the effective tax rate for them was in the mid 40% range (a few points higher than today but by no means much higher).
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ndriscoll 3y ago
For what it's worth, when the marginal rate becomes very high, things like more time off (e.g. unpaid leave/sabbatical) or part-time work become more attractive instead of more compensation. If you can negotiate a 20% pay cut to drop to a 4 day week, but you were in the 50% marginal bracket, you get a 10% cut in take-home for a 20% cut in hours worked. Good deal, especially when you already have more than you need. And in this case it's the marginal rate that matters, not the effective rate. Similarly, it's the marginal rate that matters for decisions like whether to work hard and take on a ton of responsibility to get to principle level, or just hit senior and coast.

Racing0461 3y ago

> effective tax rate for a doctor earning $400,000 in Quebec canada > Based on the 2023 tax brackets you provided, the effective tax rate for a doctor earning $400,000 in Quebec would be approximately 45.03%. This assumes no other deductions, credits, or tax strategies are applied. It makes me think that because that's what the ultimate end goal the progressives are planning here in the usa. tbh if that ever ends up being my effective tax rate (ie total taxes paid divided by total income), i would literally stop working out of pure principle.

smileysteve 3y ago
Weird because nobody quit working during the 50s-86 out of principle when top federal marginal rates were between 90% and 50%.
- flangola7 3y ago
  The arguments against strong marginal tax rates are not made in good faith. They're very consciously crafted by the rich.
- leereeves 3y ago
  How can you possibly claim that "nobody quit working during the 50s-86 out of principle"? Lots of people retired early during that time (like any other time) and you don't know what all of their motives were.
  - anon25783 3y ago
    Let's revise the claim, since you want to be pedantic: "Very few people, if any, quit working during the 50s-86 in protest of the high marginal tax rate".
    - leereeves 3y ago
      And do you have some evidence for that revised claim?
- mc32 3y ago
  That rate was in principle but hardly anyone paid the top rate and indeed spurred tax avoidance tactics: https://taxfoundation.org/data/all/federal/taxes-on-the-rich-1950s-not-high/ https://taxfoundation.org/data/all/federal/taxes-on-the-rich... So people didn't "quit working" but people earning over 200K (~2MM today) did start looking at ways to avoid having to pay those taxes and the net effect was that the effective tax rate for them was in the mid 40% range (a few points higher than today but by no means much higher).
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ndriscoll 3y ago

For what it's worth, when the marginal rate becomes very high, things like more time off (e.g. unpaid leave/sabbatical) or part-time work become more attractive instead of more compensation. If you can negotiate a 20% pay cut to drop to a 4 day week, but you were in the 50% marginal bracket, you get a 10% cut in take-home for a 20% cut in hours worked. Good deal, especially when you already have more than you need. And in this case it's the marginal rate that matters, not the effective rate. Similarly, it's the marginal rate that matters for decisions like whether to work hard and take on a ton of responsibility to get to principle level, or just hit senior and coast.