Why people get so upset about the Wealthy/15% tax

[maat55]

Corporations add cost to America. They need roads, they need an educated workforce, they pollute, they demand oil. . .therefore, they should pay their share.

I have never bought the moral argument that because they create jobs (of which employees provide a fair exchange for productivity), that we, as a nation, have to pander to them.

Bill Clinton was right on this issue. Corporations used to be involved in their communities, they used often be a central part of neighborhoods. . .now. . .it's all about globalization.

And that's fine. . .but if they provide no social good, then they ahve to be offset in the form of taxes.

Now more than ever.

Again, who is corporation? Only people pay taxes. The corporate tax is nothing more than a cost of doing business. It lowers wages, raises the price of goods, lowers returns on investment and transfers the allocation of resources to the government out of the hands of the private sector.

Corporations do not pay taxes, you pay the tax.

Tell me, what are the options for that money if they are not paid in taxes? There are only four places for those fund to go, higher wages, lower prices, better returns or reinvestment.

[MonkeyMama]

I'm all for a flat tax across the board.

But, a multi billion dollar industry has risen as a result of the complexity of the US tax code. A lot of the CPA's may be out of work if things were simplified too much.

Death and taxes. I wouldn't worry about it.

The fair tax sounds like a boat load of job security if you ask me.

But that's the thing. Income taxes is just one piece of the big tax pie. & the fair tax couldn't possibly be as simple as some of the fair tax proponents make it out to be. Will it be infinitely less complicated than the current tax code? Sure. You still need to define what will be taxable income and what kind of income is exempt. You still need an accounting system to collect and remit taxes. You still need a tax collection and enforcement agency. & on and on it goes if there is ever taxes of any kind. Which there always will be as long as there is a government.

[maat55]

Death and taxes. I wouldn't worry about it.

The fair tax sounds like a boat load of job security if you ask me.

But that's the thing. Income taxes is just one piece of the big tax pie. & the fair tax couldn't possibly be as simple as some of the fair tax proponents make it out to be. Will it be infinitely less complicated than the current tax code? Sure. You still need to define what will be taxable income and what kind of income is exempt. You still need an accounting system to collect and remit taxes. You still need a tax collection and enforcement agency. & on and on it goes if there is ever taxes of any kind. Which there always will be as long as there is a government.

Under the Fair Tax there would be no income tax, corporate tax, capitals gains or payroll tax. It would be a consumption tax serviced by the states. Most every state and local governments have a sales tax collection system.

The IRS would still function to a smaller degree.

[Scanner]

Again, who is corporation? Only people pay taxes. The corporate tax is nothing more than a cost of doing business.

A corporation is a recognized "person" in a way to the IRS. It is a taxable entity, a collection of people or "person" that exist for the sake of making profit (we'll exclude non-profit corps for this discussion).

It lowers wages, raises the price of goods, lowers returns on investment and transfers the allocation of resources to the government out of the hands of the private sector.

Corporations do not pay taxes, you pay the tax.

No, the money is funneled to the corp. first, and then it pays it wages out first, and THEN, on the profit it pays tax (or more accurately nowadays, it escapes taxation)

Tell me, what are the options for that money if they are not paid in taxes? There are only four places for those fund to go, higher wages, lower prices, better returns or reinvestment.

Um. . .no. . .it can go into the 1% coffers as the form of profit and just sit on the sidelines and do nothing while the People continue to build roads and schools and maintain an army to protect their sorry butts.

Am I right?

WHy do you automatically conclude that the money is benignly redistributed for the social good?

[LivingAlmostLarge]

Except consumption tax always burdens the poor and middle class the most. I am envious that Mitt Romney pays a lower tax rate than I do.

I am also envious that the wealthy, truly rich now, can hand off their inheritances "tax free." Think I am joking? NO! Read this blog wealthisgood.blogspot.com. She inherited $50k end of last year through some manuvering and avoided paying taxes.

Her grandparents are dishing out money so they don't have to pay estate taxes. They are doling out as much cash tax free as possible.

So tell me how does the average joe compete?

[Snodog]

.....

[J. Spence Financial]

This is really a tough subject because it does look bad when the well known example of Warren Buffett pays less a percentage than his secretary. But you have to look at it from another angle. Capital gains is set at 15% to as an incentive to invest in the stock market and American business. Raising this will impeed that incentive and possibly hurt the economy if it's raised high enough. There is also the argument that anybody can take advantage of this not just the rich. I think there are other ways to combat the income disparity, ie closing loopholes and trying to get money from overseas taxed and back in the United States. I would leave the capital gains tax alone, especially in this economy.

[maat55]

[QUOTE]

A corporation is a recognized "person" in a way to the IRS. It is a taxable entity, a collection of people or "person" that exist for the sake of making profit (we'll exclude non-profit corps for this discussion).

These "persons" once they take profits, pay individual taxes. The corporate tax does not get paid by mythical persons, you are the person.

No, the money is funneled to the corp. first, and then it pays it wages out first, and THEN, on the profit it pays tax (or more accurately nowadays, it escapes taxation)

Every corporate tax dollar that goes to the government would have went where?

Um. . .no. . .it can go into the 1% coffers as the form of profit and just sit on the sidelines and do nothing while the People continue to build roads and schools and maintain an army to protect their sorry butts.

So, your saying that the billions corporations make go to a small few? No, those dollars go to pay returns mainly to small investors, higher wages, more jobs, lower prices or reinvestment.

Am I right?

No, you are chasing mythical monsters that do not exist. The wealthy pay taxes when they realize earnings. The corporate tax affects everyone.

WHy do you automatically conclude that the money is benignly redistributed for the social good?

Again, where would those corporate tax dollars had gone if not to the well used hands of the government. The fact is that the private sector better allocates resources than the government. Just because the government has usurped much of the citizens freedom does not make it wise or worthy to do so.

A constitutional government would not need near the funds it waste/taxes now.

[Bades]

Except consumption tax always burdens the poor and middle class the most. I am envious that Mitt Romney pays a lower tax rate than I do.

I am also envious that the wealthy, truly rich now, can hand off their inheritances "tax free." Think I am joking? NO! Read this blog wealthisgood.blogspot.com. She inherited $50k end of last year through some manuvering and avoided paying taxes.

Her grandparents are dishing out money so they don't have to pay estate taxes. They are doling out as much cash tax free as possible.

So tell me how does the average joe compete?

What's wrong with passing inheritance off tax free?

If my father amassed 5 million over a long life of working hard and making smart decisions - why should I see a large portion of that go straight to the gov't when he dies?

[Bades]

I can see my OP has gone off topic more than once.

My whole idea was this:
The more risk you take on, the less tax you should pay. Regardless of how much you make.

Income from Salary = virtually no risk = higher taxes. Income from investments = high risk = lower taxes.

It's as simple as that. Not sure how the above statement can be seen as unfair?

If someone wants to generate 100% of their income from LTCG, then they are taking on HUGE risk! If they make out in the end, even with millions of dollars, good for them.

[glycemic]

please.... capital gains are on money that inherently has already been taxed. its treated differently and it should be.

[rj.phila]

I can see my OP has gone off topic more than once.

My whole idea was this:
The more risk you take on, the less tax you should pay. Regardless of how much you make.

Income from Salary = virtually no risk = higher taxes. Income from investments = high risk = lower taxes.

i run a business in a very risky industry. by that logic, i should be taxed less than an independent business owner in a low-risk industry, who should be taxed less than a salaried employee at wal-mart. i dont see the logic in that. are you saying the multi-millionaire earning the brunt of his income on LTCG is MORE risky than an independent businessman who's putting up his limited capital to say, buy a food truck, or start a franchise? that CG risk is a "special breed" of risk, and thus NEEDS to be rewarded accordingly?

your perspective would ring true if the entire concept of taxation functioned to incentivize people to work, take risk, etc. which it's really not. it's there to build roads, regulate food, stop sex trafficking, etc-serve a common good.

[Joan.of.the.Arch]

Seems like your Dad paid his taxes on his money as it came in. When you inherit, you will pay your taxes on your money. (Any given lump of money is taxed repeatedly as it moves through the economy; no surprise.) Even if we accept the idea that the risk one takes to earn money should determine how much tax one pays, I could point out that you are taking no risk in inheriting.