Comments on: Taxes: Why tinkering beats wholesale overhaul http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/ A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: traduceri romana daneza http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-55051 Tue, 14 Oct 2014 09:58:59 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-55051 whoah this blog is excellent i love studying your articles. Stay up the great paintings! You know, many people are hunting around for this info, you can aid them greatly.

]]>
By: Alexis Flavin http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-54505 Fri, 10 Oct 2014 00:03:42 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-54505 Wedding ceremony in which primarily through with body mass, It’s a particular warning flag about related intensity(Recommendations safe you might be with the weight and height). “That standard could be 15 when, Waterbury utters. Folks who wants do that a great many, Come up.

]]>
By: 248TaxPlan http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-44780 Sat, 24 Nov 2012 16:13:45 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-44780 Altman’s suggestion that the entire income tax (and the tax expenditures that go with it) be replaced with a net wealth tax is very tempting, but it leaves the job killing payroll taxes in place. My thinking is that there would be more bang for the buck if we eliminated the payroll taxes and lowered (and flattened) the income tax rate producing the same revenue. While an 8% income tax rate would not be materially different from the approximately 7.5% employee share of the payroll tax, the elimination of the employer’s share of the payroll tax would encourage job creation and also favor U.S. jobs over foreign workers. This revenue neutral solution to unemployment and social security funding deserves a serious look.

Only the U.S. Supreme Court can resolve the Constitutional question but as an attorney I note that most legal scholars believe that a net wealth tax would not require a “direct tax” apportionment (see Fixing the Constitutional Absurdity of the Apportionment of Direct Tax by Calvin H. Johnson, 21 Constitutional Commentary 295, 2004). A major boost to the legal argument also came with the Supreme Court’s recent approval of a tax on the failure to obtain health insurance (not a penalty) without apportionment because it, like a net wealth tax, is not the kind of “direct” or “indirect” tax envisioned when the constitution was drafted. In other words, new types of taxes are not subject to the constitutional apportionment requirement. Moreover, a net wealth tax is generally used as a replacement for estate and capital gains taxes which do not require apportionment. Read more at TaxNetWealth.com.

]]>
By: TFF http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-44748 Tue, 20 Nov 2012 22:16:46 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-44748 Agreed, KenG, taxing consumption doesn’t achieve your goals of forcing the circulation of money. Nor is it progressive.

]]>
By: KenG_CA http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-44747 Tue, 20 Nov 2012 17:31:49 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-44747 TFF, that doesn’t prevent accumulation of cash, which is what is happening now. Not that we haven’t discussed this in the past.

A person who makes $10M a year, and spends only $500K would not be contributing to the economy the same as one who earns $500K and spends it all. The latter is returning all of the cash to the economy while the former is extracting $9.5M (assuming it is being held in a near-interest free account, and not being re-invested), which means that money has to be replaced somewhere else, and the somewhere else has lately been the government.

I like the idea of consumption taxes, but they are ineffective when there is a lopsided distribution of income, as we have now. If the 0.1% were spending more of their income, they would be paying more taxes, but they are just accumulating it.

]]>
By: TFF http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-44746 Tue, 20 Nov 2012 16:45:18 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-44746 Simplest is to tax consumption. “Wealth” means nothing until it is consumed.

]]>
By: MrRFox http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-44739 Tue, 20 Nov 2012 06:50:46 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-44739 Taxing ‘wealty’ annually would be insanely fraught. Forget it.

Taxing ‘wealth’ on death is simple – we do it now. Just take 100% of it after modest allowances for children. Nobody ‘deserves’ anything he or she didn’t earn, children especially; better if the family dog got the dough than the worthless spawn of the plutocrats – Fido wouldn’t be bribing Congressmen with it.

]]>
By: KenG_CA http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-44735 Tue, 20 Nov 2012 03:33:11 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-44735 So who would appraise real estate, privately held businesses, LPS, and other illiquid assets? This kind of tax would be so heavily gamed it would be ineffective and would distort investment more than any other tax system we’ve ever had. Are you going to tax tax-free municipal bonds at 1% of their face value, when they are yielding 4%? How do you come up with a model for all of those privately held businesses that can be applied to all the different industries?

If income is taxed as it is converted to cash, it will effectively tax the wealthy, or at least those who are accumulating wealth, without the distortion. Those who build assets and don’t exchange them for cash are helping the economy, and shouldn’t be forced to liquidate their assets, which just extracts more capital from the economy.

]]>
By: FifthDecade http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-44734 Tue, 20 Nov 2012 01:05:34 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-44734 In the UK a lot of murmurings are being made about the taxation of multi-nationals that play jurisdictions off against each other and use International Tax Treaties to legally fiddle the tax system out of billions of tax revenues each year. I see a time when many in the west decide enough is enough and change the rules.

Even before then though, how about a direct tax on corporate cash as a separate item? There’s probably trillions sitting uninvested, not being used to stimulate economic growth, and just lying in Corporate Bank Accounts. Companies taking money out of the economy like this is akin to a rise in interest rates or a reduction in credit – in other words, this is a problem that needs to be solved anyway, so might as well use it as a tax raising tool at the same time.

]]>
By: Nameless http://blogs.reuters.com/felix-salmon/2012/11/19/taxes-why-tinkering-beats-wholesale-overhaul/comment-page-1/#comment-44733 Mon, 19 Nov 2012 23:10:46 +0000 http://blogs.reuters.com/felix-salmon/?p=19482#comment-44733 @Hippopotamax, SteveHamlin: a federal wealth tax would definitely be a direct tax, and there is no exception for a wealth tax in the 16th amendment. The only way a wealth tax could be imposed without having to pass a new constitutional amendment is if the federal government were to pass a law along these lines: “we want to collect $2.5 billion in wealth taxes in fiscal year 2014. Assign portions of that $2.5 billion to each state, in proportion to the number of free residents, minus the number of Native Americans, plus 0.6 times the number of slaves, in that state. Instruct states to set their tax rates to reach their targets.”

Needless to say, any kind of wealth tax would be extremely progressive compared to what we have today, even if you don’t build progressive brackets into the system directly (as Altman proposes). Since top 10% of the population control around 85% of total wealth, and top 20% control 95% of total wealth, even a straight 1%-of-all-wealth tax would fall almost entirely on the small wedge of the population at the top. It could be popular among the voters (everyone loves to milk the rich) but it would essentially be wealth redistribution.

One could argue that the problem with the current system is that there’s already too much wealth redistribution. We want all voters to pay their fair share of the cost of government. If everyone were to pay the same fraction of their income in federal and payroll taxes that is paid by the current top quintile (around 25%), we wouldn’t have a deficit problem, we’d have a surplus problem. Instead we’re trying to think up the ways to get some more out of the top 3% or 1% or whatever while cutting taxes for the 97% or 99%.

]]>