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Tax details of US super-rich allegedly leaked

bbc.com

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Re: Tax details of US super-rich allegedly leaked

#131

Post by lotsofpulp »

SequoiaHope wrote: post #97
daenz wrote: post #72

Earlier quoted context omitted.

Do you trust politicians to redistribute money fairly and with accountability?

I don’t trust politicians but as David Harvey has said, “wealth redistribution is the lowest form of socialism”. The ideal way is that wealth is more equitably distributed before it is created. Instead of a system where business owners represent a tiny minority, who then grow very wealthy and are taxed, we could have a system where everyone owns a little piece of the economy. At its simplest this could be realized by…

> Instead of a system where business owners represent a tiny minority, who then grow very wealthy and are taxed, we could have a system where everyone owns a little piece of the economy.

Like 401k/HSA/DB pension fund investments in index fund ETFs?

Re: Tax details of US super-rich allegedly leaked

#132

Post by alkonaut »

imgabe wrote: post #41
pontus wrote: post #35

Earlier quoted context omitted.

I agree that taxing unrealized capital gains is a fundamentally flawed approach. However, the problem with the current system is that these ultra-wealthy people just end up borrowing against their equity, avoiding selling if possible. I think it would make sense to count borrowing against equity as tax-wise equivalent to selling that same equity. With that loophole closed, together with raising the capital gains tax,…

But borrowing is not equivalent to selling, tax wise or any otherwise. When you get a mortgage to buy a $750k house, do you want to be taxed as though you had $750k income that year? You’re just borrowing against the value of an asset after all.

Taxes on real estate work that way and are a favorite among economists. I borrow say $500k to buy a house. Then I’m taxed some % of the property value each year e.g 1%.

Re: Tax details of US super-rich allegedly leaked

#133

Post by TaylorAlexander »

lotsofpulp wrote: post #131
SequoiaHope wrote: post #97

Earlier quoted context omitted.

I don’t trust politicians but as David Harvey has said, “wealth redistribution is the lowest form of socialism”. The ideal way is that wealth is more equitably distributed before it is created. Instead of a system where business owners represent a tiny minority, who then grow very wealthy and are taxed, we could have a system where everyone owns a little piece of the economy. At its simplest this could be realized by…

> Instead of a system where business owners represent a tiny minority, who then grow very wealthy and are taxed, we could have a system where everyone owns a little piece of the economy. Like 401k/HSA/DB pension fund investments in index fund ETFs?

Eh, it’s a complex issue but generally that won’t do. When I talk about the workers “owning” a piece of the economy I’m including an important part of most ownership which is executive control. If a group of workers own their business they can also control how the business is used. This leads to more democratic outcomes. And actually “ownership” as shorthand isn’t exactly accurate as Richard Wolff argues that the important part is worker control, but they do not strictly need to own the business - they could sell shares of their business to investors who would get a cut of profits. What is actually important is worker control over the means of production, and sometimes I use “ownership” as a slightly incorrect shorthand.

Re: Tax details of US super-rich allegedly leaked

#134

Post by TaylorAlexander »

jrs235 wrote: post #125
SequoiaHope wrote: post #97

Earlier quoted context omitted.

I don’t trust politicians but as David Harvey has said, “wealth redistribution is the lowest form of socialism”. The ideal way is that wealth is more equitably distributed before it is created. Instead of a system where business owners represent a tiny minority, who then grow very wealthy and are taxed, we could have a system where everyone owns a little piece of the economy. At its simplest this could be realized by…

Quid pro quo. I have zero issues if individuals want to conduct transactions with their full [individual] legal and financial liability on the line. But if/when one wants the privilege of government recognized legal and financial limited liability in transactions then I have zero issues with those transactions being regulated and taxed.

Me either but I just don’t think a system where people get super wealthy and then politicians tax them is a system that will also be a functioning democracy. Instead the super wealthy game the system. So sure, taxing the rich is fine, but I think we can do better.

Re: Tax details of US super-rich allegedly leaked

#135

Post by atlgator »

gigel82 wrote: post #54
atlgator wrote: post #49

As others have stated, the article conflates income taxes with capital gains taxes. It also conflates asset ownership with income. Saying someone is "worth" a certain amount simply because they have a large stake in a corporation is an oversimplification. What they really own are illiquid assets, intellectual property, etc. Put to use, they produce income for the corporation as well as it's shareholders and employees…

You mean shareholders, not employees.

Shareholders and employees. Where do you think salaries come from? If employees could generate income in isolation they wouldn't need jobs would they? The assets of a company are a shared resource that benefit everyone involved with the company as well as the supply chain. Does it benefit shareholders more? Yes. Should tax loopholes be closed? Yes.

Re: Tax details of US super-rich allegedly leaked

#136

Post by imgabe »

alkonaut wrote: post #132
imgabe wrote: post #41

Earlier quoted context omitted.

But borrowing is not equivalent to selling, tax wise or any otherwise. When you get a mortgage to buy a $750k house, do you want to be taxed as though you had $750k income that year? You’re just borrowing against the value of an asset after all.

Taxes on real estate work that way and are a favorite among economists. I borrow say $500k to buy a house. Then I’m taxed some % of the property value each year e.g 1%.

Real Estate is not the same thing as stock. There is a finite amount of land. You didn't make it. Ultimately it is a shared resource and we pay a fee to society while we are permitted the exclusive use (with some restrictions) of a small part of the planet we all share.

Anyone can start a company tomorrow and declare that they have a billion shares of stock in that company. They only become worth something because the person that started the company uses their own effort and ingenuity to make the company do something that is valuable to everyone else.

Re: Tax details of US super-rich allegedly leaked

#137

Post by alkonaut »

aaronschroeder wrote: post #17

But what is the solution? Most wealth of people like Elon Musk and Jeff Bezos is tied to ownership shares in their companies. I don't think it's fair to force them to sell shares so they can cover higher taxes. I also fear efforts to extract more tax money from them will ultimately just raise the bill for the middle class. The ultra wealthy can afford to hire a team of accountants to find the loopholes while small bu…

> I don't think it's fair to force them to sell shares so they can cover higher taxes.

If the treshold is high (say $1B) then I don’t think it would be that unfair to tax stock like property at e.g 1% a year. Diluting power would just be a secondary benefit in megacorps.

Re: Tax details of US super-rich allegedly leaked

#138

Post by imgabe »

spikels wrote: post #127
imgabe wrote: post #59

Earlier quoted context omitted.

Estate taxes make a lot more sense. Heirs don’t need to get free billions of dollars for doing nothing and I have no problems with taxing dead people.

Why not both? They are different things. The free step-up in basis at death makes no sense for the very wealthy. The rule originates from the difficulty in determining the basis of assets of dead people. The very wealthy have accountants that track this. Warren Buffett can pay capital-gains tax AND estate tax.

Sure, the free step up basis does seem like a bad thing. Getting rid of that sounds like it makes sense.

That is a far cry from taxing unrealized gains as income which is what a lot of people seem to want to do.

Re: Tax details of US super-rich allegedly leaked

#139

Post by imgabe »

bradjohnson wrote: post #128
imgabe wrote: post #110

Earlier quoted context omitted.

Isn’t that generally a problem where people get slammed with huge tax bills on stock they aren’t able to sell and may not have the cash available to pay? Why would we want to do more of that?

>Isn’t that generally a problem where people get slammed with huge tax bills on stock they aren’t able to sell and may not have the cash available to pay? No, I can't say I've ever heard of that happening. You should be able to sell to cover. This will typically happen during an open trading window and brokerages will offer an option for "sell to cover". >Why would we want to do more of that? I didn't make a value st…

Ok correct me if I'm wrong, but RSUs are given to you as a part of your income, right? You don't buy them? That would make sense then to tax them as compensation. If the company gave you other non-cash items as a form of compensation, you would have to pay tax on that too. If the company rents an apartment for you, the value of the rent would be considered income.

That is a lot different than buying a stock at $10, having it go up to $100, and you now have to pay taxes on the gain (which may be temporary, the day after you pay taxes it could go back to $10).

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