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The economic consequences of major tax cuts for the rich

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Re: The economic consequences of major tax cuts for the rich

#71

Post by scotu »

justinzollars wrote: post #69
scotu wrote: post #67

Earlier quoted context omitted.

Buddy, this thread is about the long running art of "vote for me, I'll cut taxes for the rich. What you say? You are not rich? No worries, the rich will make sure those cuts help you out as well" and whoever believes it. It makes no logical sense, but people believe it. The article at the top seems to point to those cuts not trickling down. It's funny because it's not even about increasing taxes, it's just about the…

I see what is happening here. I'm talking about economics and you are talking about political slogans from the 1990's. That doesn't sound very fun - its like talking with a church person. Your point sounds like, no tax cuts because my slogan says so. My point is, it doesn't make a difference either way. The Fed's balance sheet drives wealth inequality. Hard stop. No one is helped or hurt by cuts or increases because…

If it makes no difference either way, then let's finally stop those tax cuts and prove that it doesn't make any difference! Love me some common ground.

Just one thing tho:

> Your point sounds like, no tax cuts because my slogan says so

ehm, nope. I don't have a slogan, I have some research (the original post https://academic.oup.com/ser/advance-article/doi/10.1093/ser... ) that contradicts the 90s slogan that still is used today to justify cutting taxes. So hopefully this and more peer reviewed studies will put the practice justified by the 90s slogan to rest.

Re: The economic consequences of major tax cuts for the rich

#72

Post by ajsnigrutin »

naveen99 wrote: post #70
ajsnigrutin wrote: post #17

I live in a former socialist country, with current "left" (red star in the logo) parties, who scream a lot about "tax the rich". In reality, if you look at their proposed policies: * nothing happens to the poor (since they already pay almost zero taxes) * nothing happens to the rich, because they start a company in bosnia, or delaware or panama (I have no idea how the panama papers were forgotten by the people and th…

Someone is employing you. The tax burden is effectively split between you and them, even if nominally you are paying it. You pre tax salary is an expense to your employer, which if not expensed, would likely get taxed at the highest tax rate. Wealth is again, mostly just leverage on the working class future product. in that sense they already own atleast half of it, just defining it as income instead of wealth.

What I'm saying is, that I, in slovenia, pay around a half of my gross income in different taxes and "benefits" to the government. If my income is around the slovenian average (average is a bit below 2k eur montly, but i'll round it up), my "gros-gross" from 2k(what my employer has to pay, because of additional taxes) is 2.322eur, and I get 1300eur net to my account (55%) - the rest goes to the government. (employer pays 27.864 yearly, and you get 15.600 yearly)

If you're average, or a bit above average, you pay around a half of what you make to the government.

Due to income tax brackets, this percentage changes (eg, my 10k gross, means 11.610eur the employer, and I'd get 5176eur (~45%) into my account)... 10k is basically "rich" here. (Employer pays ~140k yearly, and you get ~62k net yearly)

But, if your employer is willing to pay 11.610eur per month for you, and you want to get more out of that, you can become an independent contractor in slovenia (to have medical and pension insurance), and this will cost you ~500eur per month (including the costs of minimum accounting and a new bank account), so ~6k per year. Then you open a LLC in bosnia, which will cost you a smiliar amount of money (paperwork, accounting,...), so another 6k eur. Then your bosnian company charges the 140k for your work to your employer, and get taxed by bosnian rates, at only 10% on the first 100k of profit (so 140k-12k is 128k, so the first 100k is taxed at 10%, and i'm not sure about the next bracket, but let's say 30%, so 90k net from the first bracket, and ~20k from the second one), which means you get ~110k net income, or a bit over 9k monthly (almost 80%)

So, if you don't earn a lot, you're stuck with high taxes. If you earn a lot (by slovenian standards, 10k is a lot), you can avoid most of the taxes, by starting a company in bosnia. If you earn a lot-lot (millions), you have even more posibilities of avoiding taxes, and pretty much every rich person does this to minimize their taxes.

So, I don't want the current 55% (sum of all) taxes to be raised to 90% (or whatever) for the rich, I just want them to pay the current 55% at all, and not be able to avoid them and pay only 20% (which is less percentually than a minimum wage worker pays).

Re: The economic consequences of major tax cuts for the rich

#73

Post by justinzollars »

scotu wrote: post #71
justinzollars wrote: post #69

Earlier quoted context omitted.

I see what is happening here. I'm talking about economics and you are talking about political slogans from the 1990's. That doesn't sound very fun - its like talking with a church person. Your point sounds like, no tax cuts because my slogan says so. My point is, it doesn't make a difference either way. The Fed's balance sheet drives wealth inequality. Hard stop. No one is helped or hurt by cuts or increases because…

If it makes no difference either way, then let's finally stop those tax cuts and prove that it doesn't make any difference! Love me some common ground. Just one thing tho: > Your point sounds like, no tax cuts because my slogan says so ehm, nope. I don't have a slogan, I have some research (the original post https://academic.oup.com/ser/advance-article/doi/10.1093/ser... ) that contradicts the 90s slogan that still i…

Yeah good luck with that. The Democrats hold the House, Senate and Presidency and decided against the policy you argue for (austerity), in favor of debt monetization and liquidity. But they went even further, In the BBB bill, they favored tax cuts for the rich through bringing back the State and Local Tax deduction (SALT). I'm not sure who will enact your punitive tax increases. Any ideas? AOC and Warren represent a very small minority.

Re: The economic consequences of major tax cuts for the rich

#74

Post by scotu »

justinzollars wrote: post #73
scotu wrote: post #71

Earlier quoted context omitted.

If it makes no difference either way, then let's finally stop those tax cuts and prove that it doesn't make any difference! Love me some common ground. Just one thing tho: > Your point sounds like, no tax cuts because my slogan says so ehm, nope. I don't have a slogan, I have some research (the original post https://academic.oup.com/ser/advance-article/doi/10.1093/ser... ) that contradicts the 90s slogan that still i…

Yeah good luck with that. The Democrats hold the House, Senate and Presidency and decided against the policy you argue for (austerity), in favor of debt monetization and liquidity. But they went even further, In the BBB bill, they favored tax cuts for the rich through bringing back the State and Local Tax deduction (SALT). I'm not sure who will enact your punitive tax increases. Any ideas? AOC and Warren represent a…

Current policy discussion doesn't change the result presented in the article, the only thing I've been discussing.

> your punitive tax increases

again, never even talked bout INCREASES, only stopping cuts. Do you know the difference between not cutting and increasing? If you do are you just trying your hand at fearmongering? Nah... you seem the kinda folk who would only argue in good faith.

Re: The economic consequences of major tax cuts for the rich

#75

Post by justinzollars »

scotu wrote: post #74
justinzollars wrote: post #73

Earlier quoted context omitted.

Yeah good luck with that. The Democrats hold the House, Senate and Presidency and decided against the policy you argue for (austerity), in favor of debt monetization and liquidity. But they went even further, In the BBB bill, they favored tax cuts for the rich through bringing back the State and Local Tax deduction (SALT). I'm not sure who will enact your punitive tax increases. Any ideas? AOC and Warren represent a…

Current policy discussion doesn't change the result presented in the article, the only thing I've been discussing. > your punitive tax increases again, never even talked bout INCREASES, only stopping cuts. Do you know the difference between not cutting and increasing? If you do are you just trying your hand at fearmongering? Nah... you seem the kinda folk who would only argue in good faith.

Well I'm certainly for tax cuts. Especially in California - a high tax/very low service state. I mean just walk outside of your apartment dude. If you see that as a success story something is wrong with you. I'd never look at SF or California government and say "Keep doing that".

Re: The economic consequences of major tax cuts for the rich

#76

Post by scotu »

justinzollars wrote: post #75
scotu wrote: post #74

Earlier quoted context omitted.

Current policy discussion doesn't change the result presented in the article, the only thing I've been discussing. > your punitive tax increases again, never even talked bout INCREASES, only stopping cuts. Do you know the difference between not cutting and increasing? If you do are you just trying your hand at fearmongering? Nah... you seem the kinda folk who would only argue in good faith.

Well I'm certainly for tax cuts. Especially in California - a high tax/very low service state. I mean just walk outside of your apartment dude. If you see that as a success story something is wrong with you. I'd never look at SF or California government and say "Keep doing that".

friend, are you seriously going back to the beginning of the thread and trying to say California is bad, then tax cuts are good? Are you stuck in a loop? do you need help?

I responded to this here https://news.ycombinator.com/item?id=29845491

Re: The economic consequences of major tax cuts for the rich

#77

Post by justinzollars »

scotu wrote: post #76
justinzollars wrote: post #75

Earlier quoted context omitted.

Well I'm certainly for tax cuts. Especially in California - a high tax/very low service state. I mean just walk outside of your apartment dude. If you see that as a success story something is wrong with you. I'd never look at SF or California government and say "Keep doing that".

friend, are you seriously going back to the beginning of the thread and trying to say California is bad, then tax cuts are good? Are you stuck in a loop? do you need help? I responded to this here https://news.ycombinator.com/item?id=29845491

You accused me of not addressing your point - tax cuts are always bad (how boring). But Good luck with your crusade.

Re: The economic consequences of major tax cuts for the rich

#78

Post by naveen99 »

ajsnigrutin wrote: post #72
naveen99 wrote: post #70

Earlier quoted context omitted.

Someone is employing you. The tax burden is effectively split between you and them, even if nominally you are paying it. You pre tax salary is an expense to your employer, which if not expensed, would likely get taxed at the highest tax rate. Wealth is again, mostly just leverage on the working class future product. in that sense they already own atleast half of it, just defining it as income instead of wealth.

What I'm saying is, that I, in slovenia, pay around a half of my gross income in different taxes and "benefits" to the government. If my income is around the slovenian average (average is a bit below 2k eur montly, but i'll round it up), my "gros-gross" from 2k(what my employer has to pay, because of additional taxes) is 2.322eur, and I get 1300eur net to my account (55%) - the rest goes to the government. (employer…

My point is the employer already effectively pays the 55% tax rate for the minimum wage worker. The employer has to budget for the pretax gross pay of the worker. From the point of view of the rich, poor people’s income tax is rich people’s consumption tax. rich people consume poor people’s labor.
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