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For the first time on record, the 400 wealthiest Americans paid a lower tax rate

nytimes.com

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Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#391

Post by _edo »

jm_l wrote: post #217
_edo wrote: post #84

That has to be the worst x-axis on a graph I've seen in a long time. The grid lines measure 0-10th, 20-30th, 40-50th, 60-70th, 80-90th, 95-99th, 99.99th, Top 400? That's atrocious, not only is it non-linear, not only does it have a line with regularly spaced dots giving the impression of continuity, but it skips from percent groups to absolute numbers? If we're talking about historical taxes why are we looking at tax…

I don't understand your complaint, isn't average tax rate a percentage of income? https://en.m.wikipedia.org/wiki/Tax_rate

There's your tax bracket and then there's what you actually pay after deductions, loopholes, etc.

The common argument is that the 70% rate of the 1950's was never actually paid by anybody and the effective tax rate was much lower. By looking at actual taxes paid that entire argument can be skipped.

Anybody who studies historical taxes professionally should know this, so when they use a worse measure it looks like they're doing so because it fits their narrative.

Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#392

Post by ordinaryradical »

Joeri wrote: post #379
AnthonyMouse wrote: post #365

Earlier quoted context omitted.

> The two articles rely on vastly different cherry-picked definitions of who counts as rich, and neither claim is even remotely true anymore if you use the other definition. One of the most important things to understand about tax discussions is that there are two broad classes of "rich" -- high paid salaried employees vs. wealthy investors. When you see claims like "the top 20% of people pay most of the taxes", that…

The rich spend a smaller share of their income, so a VAT scheme would in practice produce a regressive taxation scheme, with the lowest incomes paying relatively the most, because they have to spend all of their income.

What's the possibility of implementing this in combination with a luxury rate adjustment that takes something like median values for product categories and then scales rates as you move above or below that?

Because it would seem to me that consumption of low-income earners will trend toward below-the-median while consumption of the wealthy will trend toward above-the-median, giving you an additional handle to make this taxation progressive.

Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#393

Post by xg15 »

rayiner wrote: post #319
folbec wrote: post #40

Earlier quoted context omitted.

- They are NOT speaking of the 1% (such as medical professional or high income technical professionals) - They are NOT speaking of the 0.1 %. - They are speaking of the 0.01%. One person out of 10000. Not multimillionaires. 100 millionaires and billionaires. There is a very good reason why the tax foundating speaks of the 1% and not of the 0.1% or 0.01% : it is usefull to protect billionaires.

Billionaires pay low tax rates because capital gains is taxed at lower rates. That’s true not just in the US, but in most of Europe as well. So what’s the point? Even confiscatory 100% taxes on billionaires wouldn’t raise much money (about $127 billion per year, compared to the multi-trillion cost of social programs on the table). And getting rid of preferential treatment of capital gains would risk departing from wh…

> And getting rid of preferential treatment of capital gains would risk departing from what’s become an international consensus.

I think we need a better reason than "because everyone is doing it" here.

Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#394

Post by rczhang »

_edo wrote: post #84

That has to be the worst x-axis on a graph I've seen in a long time. The grid lines measure 0-10th, 20-30th, 40-50th, 60-70th, 80-90th, 95-99th, 99.99th, Top 400? That's atrocious, not only is it non-linear, not only does it have a line with regularly spaced dots giving the impression of continuity, but it skips from percent groups to absolute numbers? If we're talking about historical taxes why are we looking at tax…

This is missing what the graph is trying to convey.

Playing with the y-axis in this case, doesn't change the shape of the data. It only makes the graph more readable. For example, would you start the y-axis on a graph of global temperature at –273.15°C (absolute zero)?

Second, why should the graph use evenly sized groups? The whole point is to show an outlier in tax data among a small group of people. Using evenly sized groups obscures this point. If a graph of global temperature only displayed in increments of 1000 years, it would likewise obscure the recent impact of human industry on temperature.

Finally, as the article notes, the graph is of actual taxes paid not historical taxes.

If there is any legitimate criticism, it's that the graph probably should have been a bar graph instead so the "top 400" (likely for ergonomics) is less jarring. Also, just saying that the numbers are known for inaccuracy? This is a lazy statement that needs to be backed up.

Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#395

Post by ameister14 »

Joeri wrote: post #379
AnthonyMouse wrote: post #365

Earlier quoted context omitted.

> The two articles rely on vastly different cherry-picked definitions of who counts as rich, and neither claim is even remotely true anymore if you use the other definition. One of the most important things to understand about tax discussions is that there are two broad classes of "rich" -- high paid salaried employees vs. wealthy investors. When you see claims like "the top 20% of people pay most of the taxes", that…

The rich spend a smaller share of their income, so a VAT scheme would in practice produce a regressive taxation scheme, with the lowest incomes paying relatively the most, because they have to spend all of their income.

That's why you pair it with a UBI, as the poster above said - if you add in more than the average cost of taxes on the UBI among people making less than, say, $150,000, it becomes significantly more progressive, even if they spend the entirety of the UBI.

Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#396

Post by xapata »

dragonwriter wrote: post #177
xapata wrote: post #157

Earlier quoted context omitted.

Generals do not earn millions in salary. To afford millions worth of automobiles, the general must have misappropriated funds.

> To afford millions worth of automobiles, the general must have misappropriated funds. Or have, or at least have once had, a lucrative side business (military personnel can do this, legally.) Or have inherited money. Or have a spouse with a greater income or inheritance. Or restore cars, such that the market value of their vehicles vastly exceeds the purchase price. Or purchase cars that have significantly appreciat…

What's the most plausible explanation? My wild guess is inherited wealth. The lucrative businesses come after retirement, as far as I know.

Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#397

Post by ameister14 »

jlmorton wrote: post #363
rayiner wrote: post #327

Earlier quoted context omitted.

Is the purpose of taxes to fund the government or punish the rich? Because if it’s the former, then looking at the share of taxes paid by billionaires is highly relevant. In the US, billionaires make just 1.3% of all income. 80% of income is earned by the bottom 99%. Confiscatory taxes would definitely achieve the second purpose, punishing the rich, but would have little effect on how much taxes ordinary people would…

> Is the purpose of taxes to fund the government or punish the rich? Government exists because of and for society, and the purpose of taxes is to create the greatest net benefit to society. Taxes are not to punish anyone, they are levied to fund services for society. Determining the optimum rate is complex and open to debate. But fairness is entirely irrelevant to the question. Whether the top marginal rate is 10%, o…

>We have a capitalist economic system, and it works pretty well for us, but that doesn't mean anyone has an inherent natural right to their capital. When it comes down it, property rights are all fictitious and exist only because society says it does. It's hardly wrong for society to decide to recoup some of what it has created.

I fundamentally disagree with that point. Government exists to protect people and their property. People have a natural right to themselves and to an extent their property - rights do not come from society, rights are internal and society functions to abridge them where beneficial.

Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#398

Post by mikelyons »

gorpovitch wrote: post #51

I'm tired to read articles written inside "Opinions" sections.(not that I necessarily disagree with it, you guys are explaining how this article is right or wrong better than me). I would really like (not intended at HN, it's a general crisis in my life) to read more articles about politics that are neutral and factually oriented. It seems like 90% of the political content I read twists facts and build cheap, cherry-…

Humans have no incentive currently to be neutral, articles will have to be written by an AI to be neutral it seems.

Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#399

Post by nemothekid »

maccard wrote: post #329
0x0aff374668 wrote: post #240

Earlier quoted context omitted.

> And that only increases as you get richer. Correct. Which is why income is such a miniscule fraction of the 1% (and above's) earnings. It's all out there in the open. Pick any CEO in the top-100 corporations. Look at their income. Then look at their overall earnings. The bulk falls under capital gains due to stock. Then there is deferred compensation, where taxes are lowered even MORE if you agree to postpone being…

> Pick any CEO in the top-100 corporations. Look at their income. Then look at their overall earnings. Warren Buffet is probably the easiest person to look at here. A quick google says that [0] he made $11m in 2016, and on that he paid $1.85m in federal income tax, and he claims a large portion of the remainder was paid in state tax. Even ignoring his state taxes, yes he paid a marginal rate of 16%, but he still paid…

>A quick google says that [0] he made $11m in 2016,

The amount he made in 2016 is the point of contention. Sure he made 11m in income, but for that same year, BRK.A increased a staggering 25% in share price. Even if Buffet owns a 1% of BRK.A, that represents a paper gain of 4 Billion dollars.

Now, sure, he might not have sold any stock so that won't count against his capital gains tax, but to me, its a bit deceptive to say that Buffet only made $11M.

Re: For the first time on record, the 400 wealthiest Americans paid a lower tax rate

#400

Post by dv_dt »

TheSpiceIsLife wrote: post #348
brightball wrote: post #320

Earlier quoted context omitted.

I’ll go ahead and preface this by saying “I don’t know” but for people at the very top, are there undisclosed tax incentives to encourage them to spend their money? By undisclosed I mean negotiated. When you are trying to get somebody to spend a ton of money to open a business, donate to charity, bring a bunch of jobs, etc is there a negotiation that happens to provide lower tax options to encourage that spending?

Evidently, as evidenced by every large spending project since the dawn of time (probably?). As I posted elsewhere in these comments: Everyone expects a discount on goods and services when purchase in bulk. Why should taxes be any different?

The wealthy also receive the lions share of benefits from stability and especially international infrastructure maintained by the US state.

Some would argue that taxes are different because of the issue of fairness in society, and for the fortunate who have vastly more than needed to survive, more should be expected to help everyone else. This is in the self interest of the wealthy, as economic growth is actually stunted by inequality.

There are other ways to balance fairness other than progressive taxation, but those too are often anathema to ruling economic policy makers.

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