Really rich people are suddenly paying quite a bit more in taxes • Hacker News Board

Re: Really rich people are suddenly paying quite a bit more in taxes

#61

Post by baddox » Thu, Dec 31, 2015, 4:38 AM UTC

harryh wrote: post #29

curiousgeorgio wrote: post #26

Earlier quoted context omitted.

While you are entitled to that opinion, I think it's really hard to say with any confidence what your attitude would be at a vastly different income level. It may be useful to frame the idea in a different way: You sound as if you'd approve of a ~53% tax rate at an income level higher than your own, but not necessarily at your own level. For the sake of argument, if you were to work just as hard for every dollar at t…

> if you were earning 7 figures and wanted to help society / people in need, would the government really be your best choice in terms of bang for your buck? Has anyone ever tried to make a serious attempt to analytically tackle this question? There are a lot of people that try to rank charities against each other in terms of effectiveness. Could the same be done with government? Or even some portion of government? I…

I don't know if anyone has made a serious attempt to tackle that question, but I would also be surprised if many people genuinely believe that donating a dollar to the US federal government is better for society than donating it to any remotely competent charity.

If you're donating to specific government programs, sure, some of those are pretty similar to charities (although you can probably find a more efficient charity in nearly any area of focus). But simply donating a dollar into the funding of the US government, and having it split the same way that all US government revenue gets spent, seems to me like an obviously poor choice.

Re: Really rich people are suddenly paying quite a bit more in taxes

#62

Post by OneMoreGoogler » Thu, Dec 31, 2015, 4:38 AM UTC

> It showed that the effective tax rate paid by those Americans jumped in 2013 to nearly 23 percent.

As a data point, my family paid 28% average federal tax, on AGI of $355k. We are California residents. Taxes are regressive on the higher incomes, and that doesn't seem right.

Re: Really rich people are suddenly paying quite a bit more in taxes

#63

Post by Mikeb85 » Thu, Dec 31, 2015, 4:39 AM UTC

addicted wrote: post #32

jmspring wrote: post #10

I'm not a Trump fan, and despite likely tax hits, his proposal of simplifying the tax code (as many have done before him), getting rid of the IRS (yes jobs lost, but really, I got a certified letter owing $0.51 and they were "too busy with this category to answer. click ") would be a positive thing. One short summary of his proposal -- http://www.thepoliticalinsider.com/donald-trump-unveils-his-... I think a pure fla…

The flat tax is an incredibly pointless solution. The flat tax is opposed to a progressive tax, that says that instead of having a tax rate of 15% for 100% of your income, you have a tax rate of 0% for the first $10000 of your income, 10% of the next 20000, and so on. This is something that can be calculated mentally, looked up using IRS published tables, or calculated with no effort in a 10 line script or some of th…

It's not a terrible solution. Ideally a flat tax (which pretty much always means a lower rate than high earners pay) simplifies the tax system, and makes high earners less likely to evade taxes. However it doesn't change the fact that really high earners get a lot of their wealth from investments, so in the end they'll still pay a lower total 'rate'. The highest tax burden will still be paid by upper middle-class professionals who have a high salary but few investments.

If governments really want to collect taxes from the ultra-rich, a wealth tax is what is necessary. However that alone poses problems because 'wealth' is not always liquid - do you tax the old lady whose house has appreciated significantly but who doesn't have an income? Do you tax an entrepreneur whose firm is worth several million but hasn't actually realized any significant income?

Anyhow, just a few musings, but the summary is that taxes are hard. Too high and people evade them, too low and the government has a shortfall...

Re: Really rich people are suddenly paying quite a bit more in taxes

#64

Post by gnaritas » Thu, Dec 31, 2015, 4:39 AM UTC

jmspring wrote: post #10

I'm not a Trump fan, and despite likely tax hits, his proposal of simplifying the tax code (as many have done before him), getting rid of the IRS (yes jobs lost, but really, I got a certified letter owing $0.51 and they were "too busy with this category to answer. click ") would be a positive thing. One short summary of his proposal -- http://www.thepoliticalinsider.com/donald-trump-unveils-his-... I think a pure fla…

> I think a pure flat tax would actually be bad for the country implemented immediately

It would be bad in any form, it's regressive; marginal utility and all that, taxes should be progressive or they're not a fair burden.

Re: Really rich people are suddenly paying quite a bit more in taxes

#65

Post by baddox » Thu, Dec 31, 2015, 4:40 AM UTC

morgante wrote: post #36

harryh wrote: post #29

Earlier quoted context omitted.

> if you were earning 7 figures and wanted to help society / people in need, would the government really be your best choice in terms of bang for your buck? Has anyone ever tried to make a serious attempt to analytically tackle this question? There are a lot of people that try to rank charities against each other in terms of effectiveness. Could the same be done with government? Or even some portion of government? I…

> Could the same be done with government? I don't think so, just because the goods it provides are so numerous and muddled. Take one example: the fact that if I sign a contract I will feel legally obligated to follow through on it. This provides tremendous social good (billions of dollars worth), but it's very hard to quantify exactly how much. Then you have to figure out how much it costs to provide that good. Shoul…

> Take one example: the fact that if I sign a contract I will feel legally obligated to follow through on it. This provides tremendous social good (billions of dollars worth), but it's very hard to quantify exactly how much.

It's not so clear how much of a service the government is providing there. Do you eagerly sign contracts with people you suspect would cheat you if they thought they could get away with it?

Re: Really rich people are suddenly paying quite a bit more in taxes

#66

Post by gnaritas » Thu, Dec 31, 2015, 4:41 AM UTC

Mikeb85 wrote: post #63

addicted wrote: post #32

Earlier quoted context omitted.

The flat tax is an incredibly pointless solution. The flat tax is opposed to a progressive tax, that says that instead of having a tax rate of 15% for 100% of your income, you have a tax rate of 0% for the first $10000 of your income, 10% of the next 20000, and so on. This is something that can be calculated mentally, looked up using IRS published tables, or calculated with no effort in a 10 line script or some of th…

It's not a terrible solution. Ideally a flat tax (which pretty much always means a lower rate than high earners pay) simplifies the tax system, and makes high earners less likely to evade taxes. However it doesn't change the fact that really high earners get a lot of their wealth from investments, so in the end they'll still pay a lower total 'rate'. The highest tax burden will still be paid by upper middle-class pro…

> It's not a terrible solution.

It's precisely a terrible solution. Yes, taxes are hard, but a solution that punishes the poor (or the not rich) by not recognizing the marginal utility of money is terrible in any form.

Re: Really rich people are suddenly paying quite a bit more in taxes

#67

Post by maratd » Thu, Dec 31, 2015, 4:43 AM UTC

voynich61 wrote: post #57

poikniok wrote: post #53

Earlier quoted context omitted.

And you are a leech my friend, at least this man provides some service to the world, unlike you ...

1) We have no idea what this person does. He could be a tobacco company executive (or substitute some position you find immoral). 2) You have no idea what I do.

It doesn't matter what you or he does. We don't tax people based on how much we like them?

Re: Really rich people are suddenly paying quite a bit more in taxes

#68

Post by voynich61 » Thu, Dec 31, 2015, 4:43 AM UTC

JackFr wrote: post #60

voynich61 wrote: post #52

Earlier quoted context omitted.

You earn $1MM per year. That means either a) you spend way too much or b) you actually would be, even at an 80% tax rate, 'super rich'. I assume you live in an area where housing is expensive? That's a luxury you're paying for. Of course people who already have large sums of wealth should be highly taxed as well. But you cannot tell me that the state taking 50% of the income of someone who makes a million a year is t…

> You earn $1MM per year. That means that someone valued my time, ability and labor enough to pay me for it. That is, the exchange took place because given the circumstance of my employer, my time, ability and labor were worth more to them than $1MM. I was just able to capture the $1MM portion. The idea assertion 'I spend too much' absent any context is as meaningless as the assertion that 'the government spends too…

There are myriad ways to make obscene sums without doing anything for the world, as there are myriad ways to make an incredible impact while making relatively little.

PS: the 'spend too much' situation is the one where the poster spends $500,000 on Bengal Tigers and blow.

Re: Really rich people are suddenly paying quite a bit more in taxes

#69

Post by gnaritas » Thu, Dec 31, 2015, 4:44 AM UTC

themartorana wrote: post #34

paulddraper wrote: post #31

Earlier quoted context omitted.

That's why "fair tax" advocates flat sales tax. It still leads to questions, but sales taxes are usually simpler than income and capital taxes.

This is my favorite proposal to date. Sales tax applies equally to a pencil and a yacht. It also encourages savings at lower income levels.

It's a terrible idea, a sales tax taxes spending instead of earning which automatically is a huge tax cut to the wealthy who by definition spend a far smaller percentage of their income than the middle classes who basically spend it all. Taxes belong on income, not on spending; sales taxes are incredibly regressive.

Re: Really rich people are suddenly paying quite a bit more in taxes

#70

Post by programmarchy » Thu, Dec 31, 2015, 4:44 AM UTC

wonderlust wrote: post #30

programmarchy wrote: post #9

I'd be happier if taxes were cut from the bottom up, instead of increased from the top down.

I too would be happy if I got every service the government offers for a cheaper price.

Same here, which is why I'm a proponent of market anarchism. Central planning does not have an effective price discovery mechanism, which is one reason why we've been getting much less for much more. Just look at our shitty education system or our police, which both seem to get worse and worse the more we spend on them.

Markets allow experimentation and level the playing field, whereas states ossify corporate power and centralize wealth. Not to mention, they're based on mutually beneficial transactions between consenting individuals rather than a monopoly on violence.