10-27-21 spal
do you see the irony
===
No - as they are different things and so there is no irony.
Property tax is a wealth tax, but a very well designed and targeted one. I fully understand the reason for it, its use and application and I support it (with or without children, I should add).
On the other hand recklessly lunging for a piece of nebulously defined "un realized gains" is idiotic and dangerous. |
|
10-27-21 carib
SPAL: my reading is that individuals suffer taxes, but have very limited influence on tax policies. Legislators have a very different perspective, of course, and rightly so.
As an individual, I try to optimise my situation, and I have the impression you do the same, after reading your posts.
Every rational person tries do to the same, I guess.
Of course 0 taxes and 0 services is far from an optimal solution.
The US remains a very welcoming jurisdiction for high net worth people, but must be handled with care, in my opinion, and there are better residence options, again in my opinion. |
|
10-27-21 carib
BTW: do you see the irony of the emotional reaction supporting property taxes higher than 2,23% on "somebody who can afford a 5,2M house" (probably largely on credit).. coupled with an equally emotional negative reaction to the idea of putting a 1% capital gain tax on someone with 1.000 times higher NET worth?
Can you analyse the origin of the reactions? |
|
10-27-21 spal
I do not understand why this concept appears difficult to grasp.
===
If you are to buy property in the US (and again this is relevant as our whole discussion is about US taxes in the context of a change here) - then property taxes factor into this.
My point remains that they an important component of the existing system and they are there for societal needs that are general a common good. Live here and you pay them and you bare happy to do so. |
|
10-27-21 spal
Allow me to me pragmatic in the choice of locations where to buy property for personal use.
===
Of course but that does not and will not in any way change the meaning or social intent of property taxes - certainly within US Jurisdiction.
|
|
10-27-21 carib
SPAL: for the very simple reason that you can buy a 5,2M similar house that pays a small fraction of such tax in plenty other countries..
I do not understand why this concept appears difficult to grasp.. |
|
10-27-21 spal
Top property taxes in Texas reach around 2.23% in Fort Bend which is very nice and where I am looking actually.
2.23% is around 200% of the national average BTW.
Anyhow 120,000 / .023 = $5.2 million
I do not see why anyone on this planet who can afford a $5.3 million property needs to quibble about property taxes and I suggest raising them the more they quibbled. |
|
10-27-21 carib
| SPAL: No Louis XVI. just property taxes above 2% of purchase price, annually. |
|
10-27-21 carib
SPAL: the misunderstanding arises from the fact that I am a sort of "nomad", having changed, for real, home about 20 times in my life, and country of residence about 10 times.
Hence, I have no sense of "community", except if by "community" you mean "humanity" in general.
I guess I am part of the "cosmopolitan elite". Proudly so.
Allow me to me pragmatic in the choice of locations where to buy property for personal use. |
|
10-27-21 spal
it was over 120K a year.
====
BTW I did not know Louis XIV was still alive and shocked to learn he is resident in TX ...
|
|
10-27-21 spal
| It is mostly irrational really - and it is certainly self centered. Clearly Texas property taxes are of no real issue to me - and I will be taking no kids to Tezas - indeed this will be a second residence ... although the Waltons will not be my neighbors, more than likely. |
|
10-27-21 spal
SPAL: indeed, property taxes in the US have a reason, but I think end up being unfair for people who have no kids, or grown up kids.
====
Well with respect - you certainly miss the point on this.
Indeed the fact that you have kids or not is not relevant in the case of this tax. Here it is important to the community as a whole and not you in particular that the schools are well funded - the concept (not a foreign one I hope) is that you will still benefit whether or not you have kids as society as a whole benefits. Should you opt for more or something different in this context is a bonus ... more power to you.
The general concept of broad and not particular benefits is central to taxes and tax theory.
Side note ... I have made offers on a couple of places in Texas over the past few days ... I am happy to pay their property taxes and indeed that is a minor consideration.
|
|
10-27-21 carib
SPAL: I just mean that it is reasonable to select the places where you buy property in line with your specific circumstances.
If you have no kids, or only adult children, or plan to pay privately for kids education, better choose a location where property taxes are not connected to school matters.
Is this irrational, or logic? |
|
10-27-21 carib
SPAL: indeed, property taxes in the US have a reason, but I think end up being unfair for people who have no kids, or grown up kids.
I was sort of shocked this summer in Houston seeing a house that looks like one of mine, and hearing property tax on it was over 120K a year. Not my cup of tea. |
|
10-27-21 spal
And excuse me for reading carefully but you might have actually said this:
"Given I always paid 100% out of pocket for my kids private education, I see no need to pay twice via property taxes."
Which at a minimum means that you think that those (or maybe just you) who pay privately for education of your own children should not (there is no need) to be taxed for education expenses by property taxes.
Correct me if I read this wrongly.
If you say this I do not think you appreciate the broader nature of this tax as it was designed not with your specific children in mind or the fact that you had some or any ... like most taxes they are there for broad societal and not specific self interested aims. Can we agree this?
|
|
10-27-21 spal
| So property taxes within the US are a fact and a legitimate consideration. |
|
10-27-21 spal
| I do believe we are talking about a proposed wealth tax in the US. |
|
10-27-21 carib
Spal: as I wrote several times.. I am anti-taxer, not the opposite.
the peculiarity of local taxes financing schools is north american, not global.
where local authorities are financed by the central government, and have limited tasks, there is no need of high local property taxes. |
|
10-27-21 spal
Given I always paid 100% out of pocket for my kids private education, I see no need to pay twice via property taxes..
====
Ah ... but here I read that taxes were all about the commonwealth - correct? And while your kids are important to you - taxers always are concerned with societies kids correct. How will they be educated? For you will reap the benefits of this ... so they argument goes.
Taxers are not going to be happy with your response I am afraid. |
|
10-27-21 carib
Spal: I do understand the logic of property taxes.
They are fair if taxpayers get back their money worth in terms of local services.
That said, I do prefer to hold property... where property taxes are low, in particular if that does not imply very bad services.
In the USA, if I understand correctly, property taxes are used to finance local schools.
Given I always paid 100% out of pocket for my kids private education, I see no need to pay twice via property taxes.. |
|
10-27-21 spal
| Carib - normal, average societies have reasonable property taxes - can I assume you and I both know this and understand why. |
|
10-27-21 carib
Spal: once again.. we were confronting the proposal of higher taxes on those earning over half a million, with the idea of taxing those worth over a billion.
your "50k to 100k" middle class is completely unconcerned by the above mentioned alternative, given neither the republicans nor the democrats, as far as I know, plan to increase their direct taxes. |
|
10-27-21 carib
spal: no matrix for me. property taxes in Luxembourg are very low.
They plan to increase them from 2023.. but just on undeveloped non agricultural land.
In my earlier caribbean island, property tax on undeveloped land, in my case, is still lower than 0,003%... |
|
10-27-21 spal
10-27-21 carib
I am aware of the fact one can live pretty decently in many US locations with an income of 75K.
houses are very cheap in many places indeed.
Not so in NY, SFO or Miami, though.
====
Ok so my point is that the above is actually the middle class and their effective tax rate is around 5-10%.
An associated point is that poverty is being alleviated and at historic lows.
So I think you are really now closing in on what is at stake with the additional tax lunge ... it is simply a gambit to sustain more excess government spending to keep one party in control of the state. But I think it is retrograde as it seems to ride on envy for its legitimacy (which is dangerous) and it is also a tax of a different and unnecessarily distortive flavor (difficult to administer, disruptive to markets etc). |
|
10-27-21 carib
Spal: I think you missed the point I was trying to make, and that is that, above a certain wealth level, people deliberately and rationally opt for receiving as "income", that is taxable income, a very small % of the money they actually make.
I guess you and I do that ourselves, so we understand the logic.
If the above fact is correct.. then increasing marginal income tax rates is rather irrelevant to increase revenue, as far as the very wealthy are concerned.
There is nothing "socialist" or envy-based in this very technical remark.
I do in fact defend the "millionaires", and admire many billionaires. no problem with that. |
|
10-27-21 spal
My property tax in Luxembourg is actually 0,003%.
I think that is very reasonable.
:-)
===
You have clearly slipped between the matrix ... |
|
10-27-21 spal
hence, in the very terms of the issue at hand, indeed the earner of 1 million gross is "middle class" in the income bracket concerned.
no joke here.
===
So we are defending millionaires to spite billionaires?
Something is not computing here. |
|
10-27-21 carib
solution... move.
people are indeed moving.
I would too.
|
|
10-27-21 carib
My property tax in Luxembourg is actually 0,003%.
I think that is very reasonable.
:-) |
|
10-27-21 spal
Not so in NY, SFO or Miami, though.
===
Solution ... move. |
|
10-27-21 carib
Spal: I do know about the whole saga of proposition 13 in California, concerning property taxes.
I was shocked by property taxes in Texas, on the other hand. |
|
10-27-21 carib
I am aware of the fact one can live pretty decently in many US locations with an income of 75K.
houses are very cheap in many places indeed.
Not so in NY, SFO or Miami, though. |
|
10-27-21 spal
If I was californian,
===
Did you know that property taxes are very low there -comparatively?
And guess what, many of them are very happy with how there real estate has appreciated.
|
|
10-27-21 carib
my earlier comment on "middle class".. was followed by
;-)
but, seriously.. the issue at stake in the discussion in the capitol is between a 2% increase in the marginal income tax rate, which as far as I remember applies to married couples with income above 511K, and a capital gain tax on fortunes exceeding one billion.
hence, in the very terms of the issue at hand, indeed the earner of 1 million gross is "middle class" in the income bracket concerned.
no joke here.
|
|
10-27-21 spal
$50,000 to $75,000
====
And as foreign this might sound to you Carib there are plenty of places in the United States where you can live perfectly well on the above income.
The reality is that the lunge at wealth is entirely political - it is driven by a craven political party who spend vast amounts of other peoples money to stay in power.
If I thought it was more principled than this, exigent or necessary we'd have a proper debate. |
|
10-27-21 carib
Spal: I have nothing, really nothing, against sharp inequalities.
If I was american, I would oppose an increase in the present marginal income tax rate. If I was californian, I would favour a reduction of top state income rates. I agreed with Trump's tax reform.
All I am saying, is that a modest taxation of extremely large estates would leave inequality practically intact, and in my opinion would be "fairer" than an increase on top income tax rates.
Of course, I admit that not being American and not being a billionaire myself makes my opinion entirely academic. But it is just an opinion, technical in nature and not "political" |
|
10-27-21 spal
A person earning one million gross.. is "middle class"
====
Clear humor right ... I mean is this was a serious discussion we'd define the middle class.
If you actually believe the above then you are living on some other planet. |
|
10-27-21 spal
Pew defines "middle class" as a person earning between two-thirds and twice the median American household income, which in 2019 was $68,703, according to the United States Census Bureau.Jul 21, 2021.
During that year, taxpayers earning between $50,000 to $75,000 were estimated to have an effective average tax rate of 2.4% and those earning $75,000 to $100,000 had an estimated average tax rate of 4.8%, according to the Joint Committee on Taxation.
https://www.cbsnews.com/news/income-tax-middle-class-families-rate-zero-2021/
|
|
10-27-21 spal
| Carib - fine - but I did not and do not understand your example and so I asked for details. I do not think - in fact I know - that taxes on the middle class are that much of a burden here. |
|
10-27-21 pillz
Dat Musk kritisch staat tegenover de hervorming spreekt voor zich, hij ziet zichzelf er rechtstreeks door geviseerd. Volgens berekeningen uit The Washington Post zou Musk in de eerste vijf jaar van het plan tot 50 miljard dollar aan belastingen moeten betalen, voor rivaalmiljardair Jeff Bezos zou dat 44 miljard dollar zijn. In een andere Tweet liet Musk verstaan dat hij de verdeling van welvaart het liefst aan private initiatieven overlaat, in plaats van de “tricksters” van de overheid.
Musk mocht zich deze week opnieuw tot rijkste man ooit kronen. Zijn fortuin steeg maandag dankzij een forse beursstijging naar 288,6 miljard dollar. Daarmee torent hij bijna 100 miljard dollar boven Amazon-oprichter Jeff Bezos uit. |
|
10-27-21 spal
| My point is if less people are not poor than taxes are more and more simply redistribution. A society should certainly have a safety net, but under properly functioning capitalism absolute inequalities are the expected result and we should be careful about reacting towards this result with a tax. |
|
10-27-21 carib
Spal: numbers are not propaganda, I am afraid.
I wrote "marginal rates". I know the difference between marginal and total effective rate.
I also know taxes are higher in Europe than in the USA.
I just asked a narrow question on an actual policy alternative, and you turn to "stereotypes".
not answering question remains a right.
I am stopping here to avoid wasting my time.
|
|
10-27-21 carib
Spal: I disagree, actually.
If you want to compare "poverty levels" it makes sense to compare the USA with other developed economies with similar income per capita, so essentially, I guess, Europe or Japan. Maybe Canada?
Any other better suggestion?
I did not raise the issue of poverty, you did.
You consistently, wrongly assume that anyone looking critically to some aspects of the US reality is a "socialist", anti-american or what else.
the end result is disappointing to say the least. |
|
10-27-21 spal
And marginal rates are not the same as effective rates are they ... I mean where should I start.
Most journos should actually be banned from writing the BS they write. |
|
10-27-21 spal
you get over the 52% I quoted.
===
It is propaganda Carib - that is my point - this rate is NOT happening - its is absurd BS.
|
|
10-27-21 carib
Spal: having said I am not your accountant, the issue I am pointing to is clear cut: the alternative between increasing further the marginal income tax rates, or decreasing income tax rates whilst introducing some form of wealth increase tax on the extremely wealthy.
To my knowledge, the marginal US federal tax rate is around 37%, and the marginal California income tax rate is, if memory is correct, 13%, to which you have ta add, I guess municipal taxes on the main residence. If you add the 2% in the marginal federal tax Biden is proposing to add.. you get over the 52% I quoted.
We are talking marginal rates, because even in term of wealth taxes that would only apply to wealth above a very high threshhold.
A person earning one million gross.. is "middle class", between a pauper and Elon Musk.
:-) |
|
10-27-21 spal
they see this as another opportunity to tax and spend... in whatever is good for their cronies ...
====
Yes and yes. |
|
10-27-21 spal
| So is there some roles for a central bank ... I would have to say yes. |
|
10-27-21 spal
Are we ok on that?
---
I am all for limited bank support with one caveat - I was the chief risk officer of a money clearing bank in NY in the teeth of the 2008 financial crisis ... we wired money to many very major names just to keep them alive ... and I can tell you without a shadow of any doubt that the entire system wobbled and you would have had a very, very ugly situation if it was not stabilized by a massive and coordinated effort by the FED. I say this as a fact. I was there - maybe not at the core ... but pretty close. |
|
10-27-21 spal
SPAL: if you compare the US with, say, Denmark, on the issue of "poverty", to what conclusions would you come?
===
It would be about as useful as comparing them on the issue of sex or humor ... entertaining perhaps, but of little practical value.
Directionally the US is making progress and the point on absolute poverty levels stands.
The wealth debate is simply mostly about envy. It is otherwise a stupidity and a dangerous one.
|
|
10-27-21 savo
pt... i am glad you agree with my preferred method of bring things back to normality... simple remove what made them abnormal in the first place.
But, I am afraid that is not what the Dems are thinking... they see this as another opportunity to tax and spend... in whatever is good for their cronies... who is going to get all those infrastructure contracts? How much money will run under the table?
|
|
10-27-21 spal
middle class @52% on income
===
What is this ...
Define middle class ... show me the exact gross income you are assessing and then show me a detailed example where you compute the taxes and effective tax rate.
It looks and smells off. |
|
10-27-21 savo
spal... Keep these thieving woke bureaucrats well away from market based valuation methods
of course i agree... but i also include the FED.
No more QE.. no more fed budget financing... no more Fed interest rate interventions...no more TBTF.... the whole lot.
Are we ok on that? |
|
10-27-21 carib
SPAL: if you compare the US with, say, Denmark, on the issue of "poverty", to what conclusions would you come?
That said, I did not once refer to "poverty" or "inequality" once in my posting.
I just asked if it it "fairer" to tax the middle class @52% on income..or the billionaires @1-2% on uncashed capital gains.
Just asking this narrow question, still un-answered.
I am very anti-tax myself. But I recognise that income tax is not the right tool, if the objective is taxation of the very wealthy.
It is a very technical observation, not a political one. |
|
10-27-21 carib
PT: I am focusing on tax.. because that is now the issue in the US Capitol.
of course the overall economy is much more important than the tax issue.
But, if assets prices were "deflated", that per se would certainly not balance the budget, quite the opposite.. |
|
10-27-21 spal
One potential source of this disjunction might be the attitudes people hold toward income inequality in the US. According to a 2019 Cato Institute survey, 55 percent of Americans (and a remarkable 70 percent of those under age 30) believe the wealth distribution in this country is unjust. Such views likely skew perceptions of whether the economy is working for poor people or not.
Another source for the mismatch between perception and reality likely rests on the mistaken but prevailing view that the US is embroiled in poverty. Our politicians and news sources frequently present the view that poverty in America is deep and getting worse. In fact, the US compares well to similar countries on poverty when it is properly measured, and the new census data show (as do other poverty statistics) that poverty has only been getting better in recent years.
The United States has many challenges, and poverty is still one of them. But the new census data show what a strong economy combined with a safety net that supports employment can do.
https://www.aei.org/poverty-studies/poverty-in-the-us-reached-historic-lows-prior-to-the-pandemic/
What you see in the current vogue on wealth taxes comes mostly from the bureaucratic chattering class --- it is simply the politics of envy from uppity wokes. |
|
10-27-21 spal
Because of
@Sen_JoeManchin
opposition, the Dem leadership and White House sources tell us that the billionaire tax is all but dead.
====
Good as it is total BS - the politics of envy. Keep these thieving woke bureaucrats well away from market based valuation methods. |
|
10-27-21 spal
Let the market decide what things are worth. The market has voted on Elon. This happens in real time. It may seem unreal to some people - so what - big deal - I for one do not care.
Keep communists away from the wealth of others. Limit taxes and spending. Let businesses grow and crash.
|
|
10-27-21 patient-trader
Carib, you are only focusing on taxing. The core problem are the inflated asset prices. Elon Musk "wealth" of 200-300 bn is just unreal and bears no relation to reality. Can he actually pay 2bn tax a year? I doubt it.
If asset prices come down you dont need to tax the rich. The trick to get prices down is to increase interest costs.
|
|
10-27-21 carib
PT: Savo and yourself point the finger to the contingent anomaly of negative real rates and inflated assets prices.
I point the finger on a different matter: if you want to "tax the rich".. the proper instrument must look to wealth gains more than to actual income.
Having said so, a 1-2% tax on wealth, is quite different from a 23% tax on uncashed capital gains, IMHO.
|
|
10-27-21 patient-trader
We agree that the core problem is the zero interest rate policy which has hugely inflated asset prices. Taxing the beneficiaries / rich sounds reasonable but does not solve the problem. Investors will keep buying assets as long as interest rates are zero.
What is needed is that asset prices come down. That can only happen if interest costs increase so that investors are deterred to borrow and buy.I am not sure whether it is possible to increase interest rates without killing the economy. A possible alternative could be a large tax on top of interest costs to force investors to deleverage and sell assets.
BTW: A similar situation happened in Germany during the 1920s hyper-inflation. Mortgages became worthless and borrowers effectively got their houses for free. Germany then introduced a tax on rental income to tax the windfall, approximately 15%. This rental tax was at the time the most important revenue of Germany. https://de.wikipedia.org/wiki/Hauszinssteuer
|
|
10-27-21 carib
PS: I do the same, using tax friendly legal structures, and ending up paying minimal taxes. This is perfectly legal, and not objectionable. The taxpayer has the right to use legal arrangements to minimise his taxes.
But the task of the legislator is a very different one. |
|
10-27-21 carib
Spal: tax brackets, by definition, are based on "arbitrary numbers".
all of them.
there is other known way, as simple as that. |
|
10-27-21 carib
as anticipated:
Ron Wyden, the chair of the Senate finance committee, said on Wednesday the plan would apply to taxpayers with more than $100m in annual income or more than $1bn in assets for three consecutive years.
It would involve treating any of their tradable assets, such as shares, on mark-to-market basis each year — a big departure from their traditional treatment under US tax policy whereby they would normally be taxed only when sold.
My point is taxation should not be conceived as a "punishment for being rich", but as a stakeholder contribution to the "commonwealth".
I would like a "lean state", with limited public spending, but I think those with the largest stakes should contribute more.
Now, basing taxation on income only.. you end up with Warren Buffet secretary contributing more than her boss, which clearly is not fair nor reasonable. The only way to charge a fair share to the ultra-wealthy.. is by taxing ... wealth, with moderation, in my opinion.
|
|
10-27-21 spal
you do not need to cash any capital gain, ever, but just re-invest within corporate structures. Most of your costs are charged to corporate structures, and you just need pocket change for living, actually.
===
You do not need to be a billionaire to do this ... this is what I do already.
Why are we fixating on an arbitrary number ... this is gravely dangerous.
The fact that Buffett supports whatsoever is simply an argument from Authority ... so what. |
|
10-27-21 spal
|
10-27-21 spal
Savo - you participated in the capitalist system - you did not have to read - you did not have to invest. You did so freely.
We certainly disagree with your (post hoc)diagnosis of your activities and your judgement about it.
I do however think that this is your own business until your theory impinges on mine. |
|
10-27-21 carib
Spal: your answer is directed to Savo, because he was the one posting that comment, not myself.
In my earlier post, I wrote I do not like taxing uncashed cap gains, but consider the situation of billionaires different in practice, and not because I have anything against them.
Warren Buffett agrees with me, and having had a direct knowledge on how the very wealthy families arrange their tax affairs, I think my argument stands.
When you are extremely wealthy, you do not need to cash any capital gain, ever, but just re-invest within corporate structures. Most of your costs are charged to corporate structures, and you just need pocket change for living, actually. |
|
10-27-21 savo
spal..
in this we disagree... I have seen the value of my portfolio go up... and I did nothing other than subscribe to seeking alpha... read it once a day.. and buy reits that they analyzed and I liked.
Had the fed not bought 120bn per month and all the rest they did to pump the market... you and i would not have seen our portfolios appreciate.
Monetary is the only real game in town since 2008.. we are bystanders..
|
|
10-27-21 spal
| Panas - I have added ... I will likely continue. We will see $100 here sooner than we think. |
|
10-27-21 panasonic
| ENVX keeps going and going :-) |
|
10-27-21 spal
| Meanwhile ENVX flexing ... as I watch it I start to calm down ... |
|
10-27-21 spal
provoked by a very unconventional monetary policy..
===
To me the monetary policy is the flip side of their fiscal policy - two faces of a very cynical Janus.
|
|
10-27-21 spal
carib.. i find the tax on unrealized cap gains very fair.
Those capital gains were provoked by the fed not by entrepreneurship...
====
100% opposed.
Most of what I do now is about unrealized cap gains. I do it 100% by taking risk - every day. I do it in Real Estate and in Stocks.
The fact that anyone can turn around and say that such gains are some how not earned by my own entrepreneurship does not feel right to me. What the fuck has it got to do with them.
|
|
10-27-21 savo
spal... i think we all more or less support the same things.. we are liberal ( in the euro sense) conservative... pro freedom.. pro market .. etc...
The debate is about an extraordinary situation provoked by a very unconventional monetary policy..
We may debate endlessly whether the fed did the right thing or should have done something different...the important point is that this monetary policy has produced effects that need to be addressed because it made more expensive the life of the many while making very few better off.
I think that is where the Dems proposal comes from...
I believe it is an interesting debate... and we are going to see more of it. |
|
10-27-21 spal
PPS: the concept of a "minimum effective tax" of 15% on corporations with over 1 billion in profits also makes sense to me..
===
Why?
Corps are pass-through entities in the final analysis.
Taxes - if they should exist at all - should be as close to final consumption as you can get it.
I also support limited property taxes.
I support charities and charitable work.
I support freedom of religion.
I do not support woke communists who do not want to work for a living and want to tax other people to buy votes. |
|
10-27-21 spal
I do NOT feel good about people who obsess about this.
|
|
10-27-21 spal
do you prefer ...
===
I prefer protecting a capitalist system. I prefer promoting independence and self reliance.
I am against any system or people who obsess and target the outcome of others.
I am for lower spending, smaller government.
Targeting wealth for taxes gets retrograde fast. I do feel good about people who obsess about this. |
|
10-27-21 carib
Savo: my observation is more limited in scope.
I think taxes are already too high as a whole, and in particular on what used to be called "the middle class".
50% of residents in practice pay no net taxes at all, because the benefits they receive are greater than the indirect taxes they suffer.
The bulk of net taxation falls on the 10% of residents that are better off, even if most of those people are not actually "rich".
(I have nothing against "rich" people, mind you, I actually wish there were more of them).
Then, in particular in the USA, you have a separate category of extra wealthy people, some genial entrepreneurs, like Bloomberg or Elon Musk, some just heirs of large fortunes, like my neighbour Mrs. Walton.
Elon Musk apparently became 36 billion dollar richer two days ago on the Tesla news.
Great for him!
But a 1% annual tax on billionaires whose fortune usually grows by over 10% p.a.looks to me like a 10% capital gain tax, which can produce significant revenue without anything resembling "expropriation".
I would use the proceeds to cut taxes on people earning less than 250K gross. I think the net economic impact would increase GDP. |
|
10-27-21 savo
carib.. i find the tax on unrealized cap gains very fair.
Those capital gains were provoked by the fed not by entrepreneurship... making pensions and property less accesible to the normal mortal and the younger generations.. who now have to share bedrooms in one flat.
The fed created... say... 5bn.. then the banking sector turned those 5 trn it into say... 50 trillion. Those 50 trillions spread out accross financial assets... property... commodities .. cryptos etc.. while simultaneously creating inflation and making the middle classes worse off and the 1% better off.
That has to be re-balanced and there are only two ways... My prefer way would be to withdraw the 5 trn... hence produce an unwinding of the 50tr... provoke a market correction and a return to more reasonable values. I will lose.. but I would be socially happy.
The second way is simply to claw that money back... realized or unrealized ... does not matter... it is fed´s money... ie the people´s money.. not investors money. And that money was created because of a pandemic panic. With the panic gone... there is no reason to let investors keep that money. |
|
10-27-21 carib
PPS: the concept of a "minimum effective tax" of 15% on corporations with over 1 billion in profits also makes sense to me..
what is missing.. is a chunk of reasonable republican senators backing or suggesting reasonable proposals on taxes and spending.. |
|
10-27-21 carib
PS: the brew they are apparently concocting is not a "wealth tax" but a tax on uncashed capital gains.
In theory, I find it unfair, because you are taxing money not received, but in practice, if it affects only people who have more money they will ever need, and have no need to ever cash such gains.. it makes sense. |
|
10-27-21 carib
Spal: the question, in my opinion, is the following.
do you prefer 52% income taxes on people earning 500.000 $,
or a 1% tax of people who own 5.000.000.000 $?
(right now, people who earn over 500K in California already pay over 50% in total taxes, for example.
Property taxes, IMHO, are already too high in many US states.
I would find fairer a "billionaire tax" than an increase in the marginal personal income tax rate, or in the corporate tax rate. |
|
10-27-21 spal
Savo - have long heard of Greg Cardone - most know for buying 1000's of apartments. Apparently very successful in that domain as far as I know.
Otherwise he seems like a kook.
Happy to go counterpoint, by counterpoint ... but seriously this reeks of conspiracy theory type thinking "cabals of banks" ... mind control about the "American Dream" ... while of course it is all true it is not true in the cartoon way he'll paint it ...
:)
|
|
10-27-21 savo
spal.. i had always been against wealth tax until the 1% of the 1% hyjacked the fed and used it to make themselves billionaires with central bank money.
on a different matter... this is an interesting counter-view:
https://www.youtube.com/shorts/2nOVtpPGneo
|
|
10-27-21 spal
| I would hope these proposal are dead in the water ... starting to get sick of this woke bullshit. |
|
10-27-21 spal
| Also in the simple Schpalian brain anyone that talks too much and with too much enthusiasm about wealth taxes = a communist. |
|
10-27-21 spal
Wealth taxes are a pretty horrendous idea in my opinion - it undercuts the principal aim of capitalism which in my simple mind is that of becoming wealthy. It will open up a can of worms.
Stick to property taxes.
|
|
Board
