What lies beneath: Evidence from leaked account data on offshore banking use

Not sure about the first sentence, but how is "most of us are just working to prop them up and keep them rich" a conspiracy theory? Isn't that the whole basis of capitalism? I am asking honestly. The social order being a mostly immutable pyramid has always been the natural model of how things work in my mind.

yes, this is why people calling states with no income tax as a "regressive" tax structure seems like a psyop.

Income tax taxes people who work for a living. Property + capital gains tax both tax assets appreciation and rent seekers (unless the investment is a high risk venture into a startup or something ambitious).

It's not really a conspiracy. You just need to know the right people intimately.

I live in a country with a thoroughly dysfunctional banking system which, by most accounts, fall right in the middle of the global income bracket.

Yet I know a ton of people in the upper-middle and lower-upper class and they all have the following characteristics of their wealth, which _do not_ appear in most wealth statistics:

* One or multiple bank accounts in offshore tax havens, with the US being the most important

* Multiple properties, whose real ownership is hidden by being assigned to family members, friends, and relatives

* A lot of overseas trips to buy things that are normally horribly expensive due to to import restrictions.

* A deep, thorough understanding not only of tax law, but also personal connections with people who work in tax agencies to understand when to avoid (legally), when to evade (knowing the tax agency won't pursue evasions under a certain currency amount) and when to get into convenient tax amnesty regimes.

Again, these aren't phenomenally rich people and they're easily hiding away 50-85% of their net wealth. By most metrics these people's income would, in theory, put them in median American lifestyle. Yet it's obvious that their standard of living _easily_ puts them in the top 2-5% of a developed country, with the addition that labor costs are so cheap that they can afford services even pretty wealthy people in other places cannot.

This is a classic in Latin America, and I have no reasons to believe it's any different elsewhere; the instruments are just different.

I just think the distribution of wealth that we are shown, “only .x% of the country have 50 million” is way off from reality.

Cash and other transactions without established reporting requirements is why. They only know what gets reported to them as a pre-requisite of being an employer or hiring entity in the United States. The burden is actually on the taxpayer to accurately report the entire detail of their taxable footprint as defined in the tax code, as the IRS would otherwise require a perfect surveillance infrastructure, wherein every movement of money is traceable to assure your tax liability is accurately assessed.

The real question, in my mind, is that, knowing John Q. Taxpayer is burdened with understanding the tax code in it's entirety (in the spherical cow, in a vacuum sense), why in heaven's name are things written in such a manner whereby doing everything by the book is so hard?

From my experience, most people get the income part, those who have good portfolios get capital gains, but most people don't even know where to start looking if they aren't guided to it by an adversarial audit, which are guaranteed to be counterproductive in fostering the any degree of goodwill between taxpayer and tax service. Obviously, an accountant is capable of learning the corpus of material to be able to work with it, but given both the licensure requirement, and the fact most accounting questions I've heard resulted in a lot of open to interpretation answers, I'm not at all confident saying it is reasonable to expect the taxpayer to accurately report things, and furthermore, to expect some group of experts to handle it for everyone else, we've not done a good job at treating tax expertise as a public good in the accessibility department.

In short, at it's core an information propagation problem, suffering from perverse incentives present in private enterprise guarding and perpetuating information asymmetry to create opportunities for profit extraction at the expense of public process being rendered largely ineffectual.