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Are super-rich people just better at making money?

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Re: Are super-rich people just better at making money?

#351

Post by dsfyu404ed »

danny_codes wrote: post #240
WalterBright wrote: post #62

Earlier quoted context omitted.

The top 1% pay 40% of the federal tax revenue. The top 5% pay 60%. California has the highest income tax at 13.3%, the highest federal tax rate is 37%. That makes the top income tax rate 50%.

Before Kennedy it was 91%. Imo we are well bellow the Laffer curve.

>Before Kennedy it was 91%.

To which the common retort is "but nobody actually paid that because prior to the tax code simplifications of the 70s you could trivially reduce your burden in all sorts of ways"

Re: Are super-rich people just better at making money?

#352

Post by eertami »

ChuckNorris89 wrote: post #306
Leherenn wrote: post #231

Earlier quoted context omitted.

You declare all the assets you own* in your tax declaration (bank accounts, properties, art, cars, equity, ...), even if abroad. You also declare your debts. I don't know how they enforce/check that, especially for foreign-based assets though. * except for household and personal common usage goods

OK, cool, but you didn't explain how does that fix wealth inequality in Switzerland or make wealth taxation fair? You just described a tax declaration system, not a taxation system. Anyone can declare assets anywhere but if they're not taxed, or taxed very little, then inequality grows. So does Switzerland do this better or fairer than other countries?

Because you pay a percentage of your total wealth in annual taxes every year (in addition to your usual income taxes).

It differs between cantons (states, kinda) and has progressive banding. Someone with 100k in wealth will pay maybe 100-200 or so. If you have 100 million CHF, in Geneva you would pay around 1 million per year in taxes on that wealth.

As the OP stated, it is global assets and wealth, so foreign/offshored investments still attract the tax. Plenty of people choose to be resident in Switzerland even with these taxes.

Re: Are super-rich people just better at making money?

#353

Post by maigret »

abigail95 wrote: post #86

There are so many wealth making opportunities that give more than literally zero expected value, and don't require 20% of your wealth. You can become rich by following the rules of expected value and compound interest. Backtest this against the population and tell me that people today wouldn't be richer if they made sound financial decisions based on the information at the time. I know I would be richer. The kicker i…

While I’m not sure I’m following you 100%, luck takes a bigger part the higher the wealth. For example, existing billionaires have a way higher chance of having inherited a huge sum than the average population. If you take sound financial decisions you might get up to a million or a few, and above that it will be always more luck than skills. 100000x that is a huge lot of luck.

Re: Are super-rich people just better at making money?

#354

Post by thrwawy74 »

smilekzs wrote: post #21
bmitc wrote: post #3

To solve all this, it's pretty simple, and the U.S. actually used to do it: heavily tax the super rich. Heavy taxation and then appropriate use of those funds for education, R&D funding, infrastructure, etc. is actual trickle-down economics. And mega corporations should be heavily taxed instead of holding the country economically hostage. They jumpstart their companies off of government funding and R&D and then act a…

One thing I've noticed consistently, is when politicians talk about "taxing the wealthy", they almost always follow that with "earning more than $xxxk a year". This is conflating wealth with income. Being within this tax bracket myself, I do not deny that I am biased, but I do hope this bullshit gets called out hard whenever someone brings up yet another underhanded measure to milk us (typical SFBay SWE) above and be…

I could see tax brackets working by how your income compares to the area you live in.

"If your income is 30% above the average income for this area or the national average (whichever is lower), that >30% is taxed at this rate..."

So then you can't have rich folks disappearing to less-taxed areas. It could make rich people communities where they all stick together.

looking forward to the future where currency is time (the movie In Time), and we can tax rich people to death.

Re: Are super-rich people just better at making money?

#355

Post by black_13 »

988747 wrote: post #297
greedo wrote: post #288

Earlier quoted context omitted.

Your first sentence ignores what you say in the second. In the US, poor people pay a significant portion of their income in sales tax which is regressive.

Yes, I kind of missed that. On the other hand, sales tax in the US is very low compared to European VAT (0-7% vs 18-25% VAT), so it's much smaller issue.

[dead]

Re: Are super-rich people just better at making money?

#356

Post by yourapostasy »

jmyeet wrote: post #175
FiberBundle wrote: post #158

Earlier quoted context omitted.

I agree. Taxing unrealized capital gains is just not a good idea at all. What's more problematic than people having huge sums of unrealized book value, is that in the current system they're allowed to live a lavish lifestyle by taking out loans against those assets (which effectively is an income for them) without paying any taxes at all. That is what should be taxed in some form.

We tax property without realizing a gain. We even tax bonds on deferred interest (eg zero coupon bonds). We can and should do this for stocks. The ultra-rich already borrow money to avoid realizing gains (and thus paying taxes). If they want to keep their stocks let them borrow to pay their tax bills.

> We tax property without realizing a gain.

Not only do we do that which dis-proportionally hurts the less wealthy more, but property taxes are assessed upon assessed valuations of which the homeowner who does not sell or gets loans upon that valuation obtains zero benefit from. So the insurance company (which also uses the valuation) and the property tax jurisdiction(s) obtain yield from the valuations that year, and do not endure a clawback when the valuations ever decline.

Re: Are super-rich people just better at making money?

#357

Post by jermaustin1 »

smilekzs wrote: post #21
bmitc wrote: post #3

To solve all this, it's pretty simple, and the U.S. actually used to do it: heavily tax the super rich. Heavy taxation and then appropriate use of those funds for education, R&D funding, infrastructure, etc. is actual trickle-down economics. And mega corporations should be heavily taxed instead of holding the country economically hostage. They jumpstart their companies off of government funding and R&D and then act a…

One thing I've noticed consistently, is when politicians talk about "taxing the wealthy", they almost always follow that with "earning more than $xxxk a year". This is conflating wealth with income. Being within this tax bracket myself, I do not deny that I am biased, but I do hope this bullshit gets called out hard whenever someone brings up yet another underhanded measure to milk us (typical SFBay SWE) above and be…

For the majority of the time there has been a Federal Income Tax, there have been top brackets in the 70% range. This was a burden begrudgingly borne by the wealthy for many generations. It funded the US leaving an agrarian lifestyle and becoming a superpower.

Did a 70% top-tax bracket force any of the uber-high earners to stop earning money because they didn't want to give 70% to Uncle Sam? No, the super rich will always want more money/property/dividends/etc no matter how burdensome the tax bracket they fall in might be.

Re: Are super-rich people just better at making money?

#358

Post by notahacker »

kelseyfrog wrote: post #328
nomdep wrote: post #322

Earlier quoted context omitted.

They would create a separated business for each property

I see this loophole brought up a lot. Is there really no way to prevent it?

Taxing businesses which own residential property at the same rate as second homes stops that particular wheeze entirely. If you wish to exempt certain types of business you believe have valid reasons to own residential property at low/no property tax rates then that becomes an exemption they have to demonstrate eligibility for, not the default.

Second homes being misclassified as non-residential property might be trickier to deal with, but a lot of jurisdictions already have laws around what is and isn't residential...

Re: Are super-rich people just better at making money?

#359

Post by ethanbond »

hartator wrote: post #349
bmitc wrote: post #3

To solve all this, it's pretty simple, and the U.S. actually used to do it: heavily tax the super rich. Heavy taxation and then appropriate use of those funds for education, R&D funding, infrastructure, etc. is actual trickle-down economics. And mega corporations should be heavily taxed instead of holding the country economically hostage. They jumpstart their companies off of government funding and R&D and then act a…

Or maybe just align income tax on capital gain taxes?

Eh, this would discourage investment. Investment is important.
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