Explore the Swiss Leaks Data • Hacker News Board

Re: Explore the Swiss Leaks Data

#141

Post by kgwgk » Tue, Feb 10, 2015, 6:50 PM UTC

JoshTriplett wrote: post #132

kgwgk wrote: post #110

Earlier quoted context omitted.

> Dividends don't magically appear out of nowhere; they're paid out of profits, just like a salary. (Some companies pay out the majority of their profits as dividends, others pay none at all.) They'd either get taxed at the business because they're not paid out, or taxed at the shareholders because they are, not both. This is not how it works. Salaries are not paid from profits. After the salaries and all the other c…

I'm well aware of how the situation works today; this was a hypothetical different structure. And I'm specifically suggesting that dividends and salaries should both effectively be treated as "costs" that reduce profits.

I'm sorry, I misunderstood your comment. I assume you would not consider costs other uses of capital as buybacks, acquisitions or investments? In any case, I think it would be easier to tax dividends together with the rest of the profit and make it tax-free for the receiver. Otherwise you would have a problem with foreign shareholders and in particular with foreign-owned subsidiaries that would otherwise pay no taxes. There are already mechanisms to tax these distributions, but if you move the taxation of dividends fully to the shareholder side the resulting system would become even more complex.

Re: Explore the Swiss Leaks Data

#142

Post by cpursley » Wed, Feb 11, 2015, 3:23 PM UTC

raquo wrote: post #135

cpursley wrote: post #61

Earlier quoted context omitted.

Good point, I should clarify: A progressive sales tax not based on purchasers income, but the type of good. For example, luxury goods should be taxed higher and basic staples very low to none. This the wealthy could not avoid tax by simply shifting money around political jurisdictions. This system would encourage transparency, encourage wealth creation as well as thrift in lower and middle income earners. Also, a sid…

That's interesting! Though after reading so many pros & cons of FairTax on wiki, I'm still not convinced it's a good idea. The potential downsides are pretty dramatic: * Easier tax evasion (first-party reporting, B2B untaxed) * Discouraging of consumption (encouraging saving, DIY & black markets) * Income-regressive nature of consumption That said, some of the upsides are pretty good too. And if we were switching fro…

Yeah, I'm not on board with all the FairTax tenants. For one, the sales tax should be progressive based on product type (range from basic necessities to luxury).

Savings and DYI are a good thing long term. Maybe not so much for the inflationary consumer based system that the banks and megacorporations benefit from.

The pre-bate, which is similar to a basic income should help offset the regressive nature. In fact, I think it could replace most welfare programs.

Re: Explore the Swiss Leaks Data

#143

Post by vidarh » Wed, Feb 11, 2015, 3:58 PM UTC

wtbob wrote: post #104

vidarh wrote: post #93

Earlier quoted context omitted.

> There is no moral reason why a government deserves 50% of everything you have made. Why? Personally I think the marginal tax rate should be much higher on the highest earners, for the simple reason that the impact of exact additional percentage point tax is far lower for a higher earner. To me the actual percentage is irrelevant. The relative impact is far more important. If I had to pay 1 percentage points more ta…

> Personally I think the marginal tax rate should be much higher on the highest earners, for the simple reason that the impact of exact additional percentage point tax is far lower for a higher earner. To me the actual percentage is irrelevant. The relative impact is far more important. So, you define a fair tax system as one whose perceived impact is identical across the tax base. I define it as one where people pay…

I find it entirely irrelevant whether or not the tax system is "fair" - fairness is inherently entirely subjective -, as long as it taxes based on income level (rather than e.g. race or other irrelevant factors).

What matters to me is if it optimizes for the welfare of society as a whole. And before you ask, I believe that alone is sufficient to prevent excesses like taxing higher earners to the point where they make less than lower earners, because people would in that case opt to earn less, and so it would in fact not optimize for happiness of society as a whole as it would reduce tax revenue despite increasing the perceived tax burden.

Whether the actual marginal tax rate is 99% or 1% is irrelevant to me in that context, if it achieves that goal (though I believe a marginal tax rate of 99% would be counter-productive, I do believe they could be substantially higher than most places today). I say that as someone who would be likely to deal with the effect if marginal tax rates went up.

As it happens, income/wealth is demonstrably only extremely weakly correlated with personal happiness once very basic needs are met (if you have housing, and food, basically), and as long as things are roughly as they used to or slightly better year over year. Steady improvement has a vastly higher impact on peoples happiness than absolute levels.

That, to me, makes it morally acceptable - pretty much a moral imperative - for a good society to structure taxes to maximize the return from higher earners over lower in order to reduce suffering for those with the least and to maximize the development of society as a whole. Not just because it would help those one the bottom, but because contrary to trickle down, trickle up actually works, and a trickle effect has a far more positive effect on happiness than sitting on a hoard of cash.

Setting marginal tax rates then becomes an optimization problem.