California plan for wealth tax on anyone who spends 60 days a year in the state • Hacker News Board

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#111

Post by adjkant » Sat, Dec 19, 2020, 4:16 PM UTC

Trisell wrote: post #95

adjkant wrote: post #68

Well I guess I'll take the apparently bold stance here that this isn't the end of Silicon Valley or California and yes this is fair and further, good. When people are getting 5-6% returns on investments (minimum), 0.4% is still not even stopping the rich get richer effect. Not to mention that it's almost certain no one here will ever be touched by this tax. If you're going to move where you live or significantly alte…

I think your premise that they will experience French Revolution like consequences is overlooking the fact that unlike the 1700s. Up and taking your money to another country that still likes you is the click of a mouse and a private jet flight out. So no they won’t capitulate to higher taxes of earlier times. They will just leave. Like they already are at the threat of it.

Maybe a percentage will, but I think when people are trying to guess and assume what these people will do as "rational economic agents", they miss the human factors. No one is going to pick where they go to college based on the taxes on the ultra-rich unless they are obsessed with money. Once rich, are you going to uproot yourself entirely from any family, friends, and connections in the US? You have to consider that rational economic behavior still has to consider what the point of it all is, and money for the sake of money doesn't tend to be the answer even among the hyper-rich.

What these people will come to terms with is a pretty age-old lesson - there are things more important than just how rich you are, and most of those are human. So long as they can maintain their lifestyle, I think many will want to stay. Needing to find 20K in a couch cushion to pay for your 5M in assets each year that you make 300K on won't be the thing that makes you move.

Of course, the rich today also have many legal shields and layers that will protect them from real french revolution violence. But I think anyone can feel the shift right now. Go on Tiktok and see just how many young people are getting real into eating the rich :)

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#112

Post by rorykoehler » Sat, Dec 19, 2020, 4:17 PM UTC

GhostVII wrote: post #96

Personally I disagree with the whole idea of wealth taxes, you should be taxed when you do things, not taxed just because you own something worth money. I should be able to go live in the woods alone and not have the government take some percent of my net worth just because I exist. I mean I don't have a tonne of sympathy for people with tens of millions of net worth, but it just seems wrong in principle. If I start…

I see it the opposite way around. We should only have a wealth tax and no income taxes. Capitalism means capital that earns for you while you sleep. Those who benefit the most from the system should pay for it. With only a wealth tax more people would have the means to amass wealth and there would be a greater incentive to spend rather than sit on money which would be good for the health and dynamism of the economy.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#113

Post by spicyramen » Sat, Dec 19, 2020, 4:17 PM UTC

DoofusOfDeath wrote: post #81

jhfdbkofdcho wrote: post #60

Earlier quoted context omitted.

As a rough approximation, if you’re a US citizen, then You must file a US income tax return. The US taxes your worldwide income regardless of where it’s earned. BUT under most circumstances you would get a credit against what you owe the US for what you pay the country in which you earned the money and also wanted to tax you (no double taxation in theory) It’s kind of a pain for someone living in say Kenya which does…

IIRC that's true up to a certain $ limit. (Maybe around $120k of income?) After that it's double taxed (I think )

Well, this statement may be valid in Cold War era, but anyone leaving US will probably go to a cheaper safer country where the possibility of this is close to 0

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#114

Post by tsimionescu » Sat, Dec 19, 2020, 4:17 PM UTC

Enginerrrd wrote: post #102

PragmaticPulp wrote: post #77

Earlier quoted context omitted.

> where did they think the money would come from? There’s a growing misconception that everything can be paid for by simply taxing the wealthy a tiny bit more. Several prominent activist politicians have built their platforms on the idea that billionaires are an infinite source of consequence-free tax revenue. These ideas are especially popular among the college students and new college grads I mentor. It usually fal…

While I agree with you that the idea there is fundamentally flawed, it does seem like the greatest increases in GDP and growth have occurred when the pareto distribution of wealth was the least skewed in favor of the wealthy. To an extent, this makes sense to me from a free market perspective... The less concentrated the wealth and power is, the more we can expect competition and innovation. So even though their reas…

But that is exactly their reasoning - not some fantasy of balancing the budget by taxing the rich, but a rationally supported (in history and economic theory) belief that reducing the wealth gap increases economic productivity.

Wealth taxes (if they can be enforced, which is a significant problem) are especially powerful in this area, as they reduce the incentive for rent seeking behavior - it stops people from simply sitting on their accumulated wealth, at least when it's producing less than the taxed amount for them.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#115

Post by josho » Sat, Dec 19, 2020, 4:17 PM UTC

bserge wrote: post #64

How would this be enforced? Is it even possible to track people who spend 60 days in the state?

Make it voluntary reporting with high punitive fines for those that are caught not reporting.

Pretty sure there are enough people making low wages that would be happy to report these folks if they suspected their bosses were dodging a tax.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#116

Post by bbddg » Sat, Dec 19, 2020, 4:18 PM UTC

PragmaticPulp wrote: post #77

caseysoftware wrote: post #26

I'm not sure what the problem is. When Democrat supporters demand more more more via the politicians who promise more more more, where did they think the money would come from? Believe it or not, the bottom ~50% don't have enough money to tax. The next 30-40% have some but not enough to raise enough money to help. The taxes have to be focused on the top 10% and more likely the top 1-3% to raise enough to meet these d…

> where did they think the money would come from? There’s a growing misconception that everything can be paid for by simply taxing the wealthy a tiny bit more. Several prominent activist politicians have built their platforms on the idea that billionaires are an infinite source of consequence-free tax revenue. These ideas are especially popular among the college students and new college grads I mentor. It usually fal…

Jeff Bezos is just one person. Do you really think the US can't afford to cancel everyone's student debt?

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#117

Post by fattire » Sat, Dec 19, 2020, 4:18 PM UTC

emteycz wrote: post #107

tsimionescu wrote: post #97

Earlier quoted context omitted.

The most important point of taxing the top ~1% is to simply bring their wealth more in line with their contributions, and to reduce their outsized power on the political system. Jeff Bezos isn't "worth" a million times more than his warehouse workers, and he shouldn't have that kind of money either as a matter of principle, or as a matter of democratic power. It's not a matter of punishment, but a matter of ensuring…

He as a human is worth exactly the same as the workers, of course. But that changes nothing about his right to the wealth he created. The others could create their own wealth, Bezos wasn't in a privileged position when he started. If his money gives him political power, the solution is to fix the political system, not steal his money.

"wealth he created"

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#118

Post by GavinMcG » Sat, Dec 19, 2020, 4:19 PM UTC

ryan_j_naughton wrote: post #88

jhfdbkofdcho wrote: post #60

Earlier quoted context omitted.

As a rough approximation, if you’re a US citizen, then You must file a US income tax return. The US taxes your worldwide income regardless of where it’s earned. BUT under most circumstances you would get a credit against what you owe the US for what you pay the country in which you earned the money and also wanted to tax you (no double taxation in theory) It’s kind of a pain for someone living in say Kenya which does…

> but it’s not totally absurd to think you owe something to a country whose citizenship you continue to benefit from Yes it is honestly. The US is the only G7 county (and one of the only countries worldwide) to engage in extraterritorial taxation. It is absurd. If you are gaining from services in that country, you should pay taxes to that country. If you have moved abroad and aren't gaining from any services if that…

> Because you are effectively not a member of that community anymore

People have the choice of giving up their U.S. citizenship.

> Yet simply to retain the right to return the US at some point, they must pay taxes every year in the middle?

Yes? Or do we allow everyone who isn't participating in our society as a citizen would to come and go as they please?

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#119

Post by beezle » Sat, Dec 19, 2020, 4:19 PM UTC

ryan_j_naughton wrote: post #88

jhfdbkofdcho wrote: post #60

Earlier quoted context omitted.

As a rough approximation, if you’re a US citizen, then You must file a US income tax return. The US taxes your worldwide income regardless of where it’s earned. BUT under most circumstances you would get a credit against what you owe the US for what you pay the country in which you earned the money and also wanted to tax you (no double taxation in theory) It’s kind of a pain for someone living in say Kenya which does…

> but it’s not totally absurd to think you owe something to a country whose citizenship you continue to benefit from Yes it is honestly. The US is the only G7 county (and one of the only countries worldwide) to engage in extraterritorial taxation. It is absurd. If you are gaining from services in that country, you should pay taxes to that country. If you have moved abroad and aren't gaining from any services if that…

I'm sure others could add to the list but at the very least shouldn't all Americans be on the hook for the cost of the defense of the country?

I'll agree though that the reporting and other requirements are needlessly complex.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#120

Post by amscanne » Sat, Dec 19, 2020, 4:19 PM UTC

PragmaticPulp wrote: post #77

caseysoftware wrote: post #26

I'm not sure what the problem is. When Democrat supporters demand more more more via the politicians who promise more more more, where did they think the money would come from? Believe it or not, the bottom ~50% don't have enough money to tax. The next 30-40% have some but not enough to raise enough money to help. The taxes have to be focused on the top 10% and more likely the top 1-3% to raise enough to meet these d…

> where did they think the money would come from? There’s a growing misconception that everything can be paid for by simply taxing the wealthy a tiny bit more. Several prominent activist politicians have built their platforms on the idea that billionaires are an infinite source of consequence-free tax revenue. These ideas are especially popular among the college students and new college grads I mentor. It usually fal…

Exactly. The US has one of the most progressive tax systems in the world. It hasn’t magically solved the wealth gap. Many people just want to punish the ultra wealthy, but it also won’t help.

If it’s actually about raising revenue, you will need to actually look lower, to the top 10% and broader middle class. But this isn’t nearly as compelling as a populist message to fund the various proposed unicorns...