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Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

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Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#271

Post by valuearb »

ocdtrekkie wrote: post #77
chaoxu wrote: post #62

I actually don't get why corporation should pay taxes. When the profit of the company is distributed, or paying the employees, the employees/shareholders will be taxed on that money.

Well, one problem is this just encourages companies to collect and never disburse funds to employers or shareholders. Companies in some cases are holding onto hundreds of billions in cash offshore. Your idea would make that money free to keep out of the economy and out of employee's hands.

First of all, that money is never "out of the economy" whether its in a bank-account or a dividend it's circulating in the economy, either here or overseas.

Second, the main reason U.S. companies keep foreign profits offshore is they would be taxed if brought back to the U.S.

Your understanding of the problem is exactly backwards.

Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#272

Post by dragonwriter »

gmadsen wrote: post #236
JumpCrisscross wrote: post #232

Earlier quoted context omitted.

> Human beings cannot do the equivalent Some can. Those with assets to depreciate, for example. Frankly, the whole corporate tax debate seems manufactured to obscure the top personal tax bracket being about $500,000. Raise corporate taxes and you tax everyone with shares. That hits the rich, sure [1], but it also hits every pension fund and middle class saver. And if the corporate tax rate goes up instead of a $1mm,…

the ultra rich are paid in stocks, not salary. Raising the tax brackets wouldn't do anything

So, new brackets or not, tax capital gains, gifts, and inheritances as regular income to the recipient.

Also, apply taxes (and corresponding benefit eligibility) equivalent to payroll/self-employment taxes to that income.

At the same time, allow corporations to expense disbursements: you are taxing individual income fairly, corporate tax just is a tool to prevent indefinite tax-free deferral of income.

Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#273

Post by isbvhodnvemrwvn »

varispeed wrote: post #260
kube-system wrote: post #170

Earlier quoted context omitted.

A linear tax would mean a person trying to move up the income ladder is more encumbered by tax for the same amount of tax revenue on a given population. Your suggestion above that low income workers are exempt from taxes, is a description of a progressive tax. I’m not really sure I understand what you’re suggesting should be done.

Are you saying that 40% of tax is less than 20% of tax? I don't follow. My point is that the tax should be linear with tax free allowance. That is everyone pays 20% on income above tax free allowance. You can call it a progression, but this way anyone can level up if they want to. If you add 40% and more further down the line you are slowing down how people from poor background can improve their living.

Because this 40% of tax only applies to what you earn above a certain threshold, at which point you are no longer considered to be a poor person.

Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#274

Post by relaxing »

NopeNotToday wrote: post #157
b112 wrote: post #39

Earlier quoted context omitted.

Yes, but... Decades and decades ago, corporations paid most of the tax. People paid very little. Then things shifted. Instead of taxing corporations, people were taxed. Said people, with less money in their pocket, required raises. And so, over time, tax shifted from corporate to personal, but with people in the end taking home approximately as much as they had before. For example, you have $60k pretax, $50k take hom…

National Sales Tax - tax the purchase of goods at services. Then it doesn't matter where the corporation has their HQ. No import tax needed.

The problem with sales tax/VAT is they’re regressive - the lower your income the proportionally more you pay.

Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#275

Post by wlpu »

varispeed wrote: post #260
kube-system wrote: post #170

Earlier quoted context omitted.

A linear tax would mean a person trying to move up the income ladder is more encumbered by tax for the same amount of tax revenue on a given population. Your suggestion above that low income workers are exempt from taxes, is a description of a progressive tax. I’m not really sure I understand what you’re suggesting should be done.

Are you saying that 40% of tax is less than 20% of tax? I don't follow. My point is that the tax should be linear with tax free allowance. That is everyone pays 20% on income above tax free allowance. You can call it a progression, but this way anyone can level up if they want to. If you add 40% and more further down the line you are slowing down how people from poor background can improve their living.

I think what you're missing here is the alternative to progressive tax is all income is taxed at or close to the existing highest rates, as that is where by a very large margin most tax is collected. Ultimately this leads to those poorest in society suffering the most.

Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#276

Post by leetcrew »

dragonwriter wrote: post #272
gmadsen wrote: post #236

Earlier quoted context omitted.

the ultra rich are paid in stocks, not salary. Raising the tax brackets wouldn't do anything

So, new brackets or not, tax capital gains, gifts, and inheritances as regular income to the recipient. Also, apply taxes (and corresponding benefit eligibility) equivalent to payroll/self-employment taxes to that income. At the same time, allow corporations to expense disbursements: you are taxing individual income fairly, corporate tax just is a tool to prevent indefinite tax-free deferral of income.

it doesn't really make sense to tax long-term capital gains as income, especially under a progressive system. if I hold an asset for ten years and then sell it, a significant part of the nominal gain will be due to inflation (though this is also a problem with the existing cap gain rules). but conceptually, an LTCG is not a sudden windfall, and should not be taxed as such. it is the result of one or more years' appreciation that happens to be realized all at once.

Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#277

Post by valuearb »

TheCoelacanth wrote: post #224
Erlich_Bachman wrote: post #198

Earlier quoted context omitted.

The government takes tax from the same amount of money twice. How is that not well described by the term "double taxation"?

The entire concept of "double taxation" is BS. All money is taxed multiple times as it moves around. If I get paid a wage, my employer pays payroll tax, then I pay income tax. Then when I buy something with it, I pay sales tax. Then the company I bought it from pays payroll tax on it when they pay it out to an employee, then the employee pays income tax on it. Then they pay sales tax when they buy something with it,…

The concept of double taxation is incredibly important. When you pay income and payroll taxes on your wages, its important to understand what your real tax rate is, and its a lot higher than either individually.

So what's the real tax rate in investments in the U.S? Well it's the corporate tax rate. Plus the investors capital gains or dividend tax rate. Plus the state corporate income tax rate. And the investors state income tax rate.

All these layers of taxation means it's almost impossible for taxes on profits to be less than 40% for an investor, and can reach 60%.

And sales tax isn't part of the double taxation layer, because it's voluntary. You could have spent your net earnings on things that don't have a sales tax, or saved it. And sales tax applies equally to the investor receiving a dividend.

Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#278

Post by bradleyjg »

leetcrew wrote: post #276
dragonwriter wrote: post #272

Earlier quoted context omitted.

So, new brackets or not, tax capital gains, gifts, and inheritances as regular income to the recipient. Also, apply taxes (and corresponding benefit eligibility) equivalent to payroll/self-employment taxes to that income. At the same time, allow corporations to expense disbursements: you are taxing individual income fairly, corporate tax just is a tool to prevent indefinite tax-free deferral of income.

it doesn't really make sense to tax long-term capital gains as income, especially under a progressive system. if I hold an asset for ten years and then sell it, a significant part of the nominal gain will be due to inflation (though this is also a problem with the existing cap gain rules). but conceptually, an LTCG is not a sudden windfall, and should not be taxed as such. it is the result of one or more years' appre…

A flat reduced rate after a year isn’t much of a fix to that problem. Given that we have CPI and use it in lots of other government programs it’d be easy enough to just adjust the basis for inflation (and while we are at it we can get rid of the step up basis at death.)

Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#279

Post by leetcrew »

bradleyjg wrote: post #278
leetcrew wrote: post #276

Earlier quoted context omitted.

it doesn't really make sense to tax long-term capital gains as income, especially under a progressive system. if I hold an asset for ten years and then sell it, a significant part of the nominal gain will be due to inflation (though this is also a problem with the existing cap gain rules). but conceptually, an LTCG is not a sudden windfall, and should not be taxed as such. it is the result of one or more years' appre…

A flat reduced rate after a year isn’t much of a fix to that problem. Given that we have CPI and use it in lots of other government programs it’d be easy enough to just adjust the basis for inflation (and while we are at it we can get rid of the step up basis at death.)

my preferred solution would be to (after adjusting for inflation) calculate the annualized gain over the years the asset was held. then go back and tax it as if it were additional income in each of those years, using the historical brackets, adjusting (again?) for inflation.

unfortunately I don't write tax law. maybe I could get the tax prep companies to lobby on my behalf.

Re: Netflix Made Record Profits in 2020, Paid a Tax Rate of Less Than 1 Percent

#280

Post by kube-system »

varispeed wrote: post #260
kube-system wrote: post #170

Earlier quoted context omitted.

A linear tax would mean a person trying to move up the income ladder is more encumbered by tax for the same amount of tax revenue on a given population. Your suggestion above that low income workers are exempt from taxes, is a description of a progressive tax. I’m not really sure I understand what you’re suggesting should be done.

Are you saying that 40% of tax is less than 20% of tax? I don't follow. My point is that the tax should be linear with tax free allowance. That is everyone pays 20% on income above tax free allowance. You can call it a progression, but this way anyone can level up if they want to. If you add 40% and more further down the line you are slowing down how people from poor background can improve their living.

For a government to make the same revenue with a linear tax as they do with a progressive tax, this mathematically implies that a tax increase for poorer people and a tax cut for lower people.

Alternatively, you can cut government spending, which normally means cutting services that disproportionately affects the poor.

Either way, moving from a progressive tax to a flat tax is a guaranteed net negative for the poor.

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