GOP scam Tax plan cuts for rich and hurts everyone else

No, they are not the nominal rates. One seldom pays the total NOMINAL rate as realizations may be partially below the threshold.

Of course!

That is exactly what I said earlier, it is not just the rate, there are business cycle variations. And yes, if the realization is the same, lower rates will produce smaller revenues. 25% OF 100 BILLION IS 25 BILLION. 20% 0F 100 BILLION IS 20 BILLION. But the point is clear, lower rates can contribute to better economics giving one greater realizations such that lower rates CAN DEFINITELY CREATE GREATER REVENUES. The point of all this discussion is, can lower tax rates generate higher revenue. If that lower tax rate generates more profits and realizations are high enough it can cause more revenues. It is as simple as that. And it is exactly what happened during the 1996 - 2000 period of Clinton's administration; though not proof positive that IT IS THE CAUSE OF THE HIGHER REALIZATIONS, THEY EXISTED AND THERE WAS MORE REVENUE.

Don't ever let it be said that simple statistics showing correlation to lower rates like between 1996 and 2000 were correlated inversely to capital gains realizations are proof of causation, but it surely looks like it.

 

Which honest history proves that revenues were lower for the same realizations with lower tax rates when you don't cherry pick the data like you did.

In 1967, CG revenues were $4.1B with a CG tax rate of 25%. In 1977 CG revenues were $8.2B with a CG tax rate of 40%, 100% higher than the lower tax rate.

In 1970, CG revenues were $3.1B with a CG tax rate of 32%
In 1978, CG revenues were $9.1B with a CG tax rate of 40%, 193% higher than the 1970 level with the lower tax rate.

In 1982, CG revenues were $12.9B with a CG tax rate of 20%.
In 1990, CG revenues were $27.8B with a CG tax rate of 28% (where it was set under the Reagan administration) 115% higher than the lower tax rate.

1996 $260,696 $66,396 [Cap gains tax rate 28%]
2002 $268,615 $49,122 [Cap gains tax rate 20%]
2009 $263,460 $36,686 [Cap gains tax rate 15%]
CG revenues were 44.7% lower with the lower tax rate.

Capital Gains Tax Cuts Decrease Revenue over the Long Run and Hurt the Economy

In the long run, and overall, capital gains tax cuts, do in fact cost the government a great deal of revenue, even though in the short run total revenue from capital gains taxes may go up. The first reason for this is that, unlike the income and payroll taxes working Americans pay, investors get to decide when they pay capital gains taxes. If Paris Hilton owns $100 million in Hilton stock, and it goes up to $120 million, she has a $20 million capital gain, but she will not pay taxes on this gain until she sells the stock, which may be many years later. When there is a cut in the capital gains tax rate, there is an incentive to sell the stock then, and get the lower tax rate before a new administration raises it again. Thus, when the capital gains tax is cut, there is a rush of investors selling stocks to pay their capital gains taxes now, when the rate is law, rather than later when the rate may be raised back up. Capital gains tax revenue to the government thus may go up now, but it will go down later, and it will go down overall. In addition, when capital gains taxes are cut, there is an incentive to pay CEOs and top managers more in stock and options and less in regular dollar income, so as to utilize the lower tax rate. This would raise capital gains tax revenue to the government, but lower income tax revenue by a greater amount. Finally, capital gains tax cuts tend to occur during periods of Republican control. These periods have been shown to result in drastic increases in income inequality – today there is more income inequality than at any time since the Gilded Age. With so much income shifted towards the wealthiest Americans, capital gains can increase, as they own the vast majority of stock, but at the same time these policies have resulted in stagnant or declining real wages for the rest of Americans, lowering income tax revenue, and contributing to the record budget deficits we have seen in conservative administrations.

http://works.bepress.com/richard_serlin/16/

Still waiting for you to prove your claim that tax rates affect realizations.

 

So answer the question.

Of course. The only thing we do know is that tax revenues will be higher for any give level of realizations with higher effective tax rates.

Geez, finally someone admits the obvious.

Prove it.

And lower realizations will produce lower tax revenues. Of course.

You should be lecturing Bluesguy, not me. He's the one claiming lower tax rates produce more revenues.

 

When it is all said and done, getting rid of the semantics arguments, the list I presented above shows as I have always claimed, that the business climate is a variable in addition to the tax rate and I showed 4 or 5 years in which realizations went up, effective tax rates went down and revenues went up. So it is obvious to even the untrained eye (and we seem to have a few on this thread) lower effective tax rates CAN INCREASE REVENUE IF THE BUSINESS CONDITIONS ARE RIGHT.

The charts show an increase in receipts in the amounts of:
........................Effect ive tax rates paid
1996 - 3.33 25.5
1997 - 4.38 21.7
1998 - 5.18 19.6
1999 - 5.91 20.2
2000 - 6.47 18.8
Which tells us that there were realized gains as a % of GDP with lower effective tax rates paid after the peak of the effective rate paid in 1996.

And that is proof enough that higher revenues can come about with lower tax rates.

 

That may be obvious to the untrained eye, but to the trained eye it's wrong. You're making the causal fallacy argument that the tax cut in the CG tax rate is what increased the revenues. There's no evidence for that at all. Revenues can increase because the stock market had a strong year and there were higher realizations, for reasons completely independent of the tax cut.

You have not proved that a CG tax rate cut causes an increase realizations of the stock market in the long run.

What we can say as fact is that a lower effective CG tax rate will produce lower revenues for any given level of realizations.

 

And it had a 50% fraud rate in the beginning. One used to be able to claim parents and grandparents for the EITC as a qualifying child. And the ITIN was a valid TIN for the EITC.

But through the years, modifications were made to allow person with no qualifying children, only valid SSN, and a clearer definition of what a child is for someone to claim EITC. And the ironic thing is it is one of the more complicated sections of the code with some 17 different rules that may be applied.

 

Boxes one, two and three are not earned income even if that income may be deemed as "nonpassibe." Box 7 is generally considered earned income but that is not always the case since it is the one, singular box that is misapplied the most often, especially among lawyers who place taxable and nontaxable settlement proceeds into that box.

The top 400 want to be taxed as if they were the bottom 400.

 

If tax rates don't effect revenues then why do you want to raise them?

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You think the number of the box means anything? LOTS of earned income is reported on 1099 not on W2's as wage and salary.

Platitudes and bromides. The bottom certainly do NOT want to be taxed like the top 400.

 

False premise failure.

 

Thanks for showing how realizations at the higher rates during a booming economy could barely top realizations at the lower rates in the worst of times, the lower rates produce more economic activity and under similar economic conditions far more realizations and tax revenues.

Your phony use of the number not withstanding.

I did, still waiting for you to admit that realizations don't effect rates

Put 2007 in there and tell what revenues were compared to the 2002 and explain why $263B in realizations is better for the economy and growth than $924B.

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What's false about it? Do you or do you not want to raise cap gains tax rates?

 

Because it is based on fairness and equity. With low capital gains rates increases the wealth gap to what it is now.

On box 7 yes. But not on box 1 (rents), 2 (royalties), or 3 (other). Again, box 7 (nonemployee compensation) is generally accepted as earned income. However, if someone fills out the form wrong and puts nontaxable income in that box, is it earned income?

But if you had your way, they certainly would be taxed that way.

 

Capital gain realizations have generally increased over time along with the stock markets. That proves nothing.

But your assertion that alizations at the higher rates during a booming economy could barely top realizations at the lower rates in the worst of times is simply wrong.

Realization in 1954 with a 25% tax rate were only $1.0B, while in 1977 with a 40% tax rate they were *far* higher, at $8.2B.

Nothing phony about it at all. The fact that the data doesn't support your baseless claims doesn't make it phony. I'm using the data from *your* source.

I've never claimed anything of the sort.

Still waiting for you to prove that tax rates affect realizations.

Realizations in 2007 were $924B. Of course revenues would be higher with realizations that high. Apples and oranges.

I of course never claimed that tax rates don't affect revenues.

 

That is really not a reasonable way to test the correlation of lower tax rates to increased revenues or vice versa. Of course the same or smaller % of the same value will either be the same or less. The point is, in the years 1996 to 2000 there were greater realizations and lower tax rates. Does that prove that the lower tax rates caused the higher realizations and tax rates? No! Just like the opposite is not proofs that higher tax rates and higher realizations and revenue does not prove higher tax rates are the cause. We might infer either way, but it is correlation, not causation.

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That is not the point.. 100% of nothing is still nothing. The proof of the pudding is, do the realizations and revenues ever rise with lower tax rates. The answer to that is, sometimes.



Geez, finally someone admits the obvious.



Prove it.



And lower realizations will produce lower tax revenues. Of course.



You should be lecturing Bluesguy, not me. He's the one claiming lower tax rates produce more revenues.[/QUOTE]

 

Except it is not correlation but mathematical definition that a higher effective CG tax rate will produce more revenues for a given level of realizations.

And since we can expect realizations to generally go up over time, and since, as you point out, there is no proof that tax rates change the amount of realizations, we can expect that over time to collect higher revenues with higher tax rates.

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It is exactly the point.

so what.

That doesn't prove anything. All that proves is that realizations in a given year can increase faster than tax rate cuts.

You've completely failed to prove that cutting tax rates increases realizations over the long term.

Why are you dodging the question?

 

No, I am not. I am saying that the correlation is there that with lower tax rates at the same time as higher realization and higher revenues. It does not specify causation any more than lower tax rates along with lower realization and lower revenues, all it does is show correlation.

ABSOLUTELY! Just like higher tax rates and higher revenues are not proof of causation either. There are other variables. I said that days ago when I said there were move variables than just tax rates to be considered. Sorry you missed that point then.

I have never tried to prove that. All I did was prove that increases in realizations or decreases in realizations and variations of tax rates only produce correlation, not CAUSATION.

In other words you are saying nothing. 10% of 100K will always be 10K, as will 5% of 100K will always be 5K. Trying to vary percentage rates with equal realization proves absolutely nothing, absolutely nothing.

 

It is absolutely not proof of anything but 1+1=2 or .1x100=10.[/quote]

And since we can expect realizations to generally go up over time, and since, as you point out, there is no proof that tax rates change the amount of realizations, we can expect that over time to collect higher revenues with higher tax rates.[/quote]Not necessarily! If those tax rates go up beyond the peak of the Laffer curve it can actually cause lower realizations and lower revenues. The whole point is, just like the marginal unit size, the realization will never remain the same and a higher tax rate could reduce investment while a lower tax rate may increase investment which in turn may create a better business climate.

What question do you think I am dodging? I have done my best to answer all that you have asked, you just don't always like the answers.

 

Let me quote or paraphrase you:

You've utterly failed to prove that lower tax rates cause higher revenues.
What we can clearly see is the historical data, not what causes increases or decreases in revenue
Correlation does not make causation.
You also can't prove that lower rates cause expanded revenues, so yes, your comments are baseless.

When you say " lower effective tax rates CAN INCREASE REVENUE" you're making the causal fallacy argument that the lower effective rate is what increased the revenues.

Exactly why it is a logical fallacy for you to say "lower effective tax rates CAN INCREASE REVENUE". You have no proof whether they can or not.

I've never said anything to the contrary.

I agree you've never proved it.

See above. When you say " lower effective tax rates CAN INCREASE REVENUE" you're making the causal fallacy argument that the lower effective rate is what increased the revenues. You don't know whether they can increase revenue or not.

We know that revenues can increase (or decrease) even if tax rates are cut. But we do not know that lower taxes can increase revenues.

 

1x100=100, not 10.

An no, it doesn't prove that at all. What it proves is that for any given level of realizations a higher effective tax rate produces more revenues.

By mathematical definition.

I agree that if you increase the tax rate to 100% we will probably get less realizations. But since you have no clue of what the peak is we don't have to worry about it.

There's no proof of that.

Playing your stupid dodgeball games again? I asked you for the source of your numbers and you've dodged it for three posts now.

 

I have not tried to do so and I have informed you of that several times.

So now you are agreeing with me as that is all I have ever said.

Smack on point. I have been saying that for a couple of days.

I have not tried to prove that either. But my comments which has said clearly that there is no causation puts my comments right on point.

No, all I have said it is possible that lower rates can spur business and produce a positive revenue.

Not only is it not a logical fallacy, I have not tried to prove what is only a possibility as we have seen historically lower tax rates have correlated positively with higher realization and revenues, and neither you nor I can say categorically the lower tax rates are not the cause of a positive business cycle.

True, and I have never tried to prove anything more than correlation.

 

Then quit saying it.

Nope.

yep

Comply your own assertions.

You have not proved it, agreed.

Nope.

No, I quoted you verbatim. What you said was " So it is obvious to even the untrained eye (and we seem to have a few on this thread) lower effective tax rates CAN INCREASE REVENUE IF THE BUSINESS CONDITIONS ARE RIGHT."

This is yet another example where you try to change your story.

But you've utterly failed to prove that lower rates can spur business and produce a positive revenue. Correlation is not causation etc. etc. Follow your own dictates.

And you cannot say that lower tax rates are the cause of it and therefore can cause it. Proving your own statement is a logical fallacy.

Thanks. That's all you had to say.

 

point 1, .1, not 1. .1 x100=10 every time as .1=1/10.

Again, I say that means nothing as any given number times any higher number will produce a higher result. Your entire argument that a given realization will produce a higher revenue with a higher rate is irrelevant, and proves nothing.

By nonsense.

You and I may not have a clue, but with access to the data Treasury should be able to keep a running tab on approximately that peak is.

I have no proof that correlation is in fact causation. But it is possible that A LOWER TAX RATE INCREASE REALIZATION BY CAUSING BETTER BUSINESS CONDITIONS. And you are utterly incapable of proving it can't.

Oh, sorry about that. I got them from a link in a post 15 or 20 posts ago. US Treasury!

www.treasury.gov/resource-center/tax-policy/documents/OTP-CG-Taxes-Paid-POS-CG-1954-2009-6-2012.PDF

So effectively, I shall reiterate, neither your historical data proves causation, it only shows correlation but both can INFER that the tax rate can have a positive or negative effect on revenue.

 

It's complete relevant. Because tax revenues are a function of realizations * the effective CG tax rate.

What data do you say we need to find this mythical number?

Yes it is possible it could. You don't know that it can and it is an logical fallacy to say that.

I didn't make the claim, you did. But we do know that for a given level of realizations a lower tax rate produces lower revenues.

That source doesn't support your data. Where in that link is this data you posted:

1993 -23.3% -$ 31.393

 

You are completely wrong. The fact that mathematically using the same realization with different tax rates changes the product does not prove anything of relevance. The only relevant issue when looking at whether or not there is positive or inverse correlation is if the product goes up or down with DIFFERENT realizations. Your whole concept of trying to use the same realization proves absolutely nothing is is totally irrelevant and fallacious. I doubt you will ever understand the validity of correlation in which realization variations with rate variations produce either positive or inverse correlation relationships.

The point is, one cannot use a fixed, or the same realization to determine correlation with varying tax rates to ascertain whether or not the new tax rate will increase revenues or decrease revenues.

That is the fact of the matter.

 

Using a fixed realization is not of value. Realization will change because of business climate and can be affected by tax rates.

Up to date data telling us how the economy is doing, whether it is an up cycle, a down cycle, a boom cycle, a recession cycle et al. If you understood economics you would know that.

Correct, we are talking about possibilities for the moment, not actualities.

So obvious there is no point in guessing, BUT it is not a fallacy, it is nothing.

I don't think anyone has ever suggested it would and I have never made that claim. But remember one creates a tax rate with the hopes of increasing revenues, not just to do mathematical calculations.

The link has now been posted twice, and it totally supports my comments. www.treasury.gov/resource-center/tax-policy/documents/OTP-CG-Taxes-Paid-POS-CG-1954-2009-6-2012.PDF Click on the link then cursor down to 1993. For that year the realization was $152,259 billion, the revenue was $36,112 billion and the effective tax rate for the total is 23.7%.

Then cursor down to 1998, the realization was $455,223 billion, the revenue was $89,069 billion and the effective tax rate was 19.6%.

You will see that the realization and the revenue is higher in 1998 than 1993 while the effective tax rate for the total was lower at 19.6.

That is black and white telling us that we historically got more revenue with a lower tax rate. That is a positive correlation. Do we know if the lower tax rate actually caused that increase in realization and revenue? Of course not, all we know is it is correlated and that a more positive business climate may be the cause, but it does not discount the POSSIBILITY THAT THE LOWER TAX RATE HELPED A CREATE MORE FAVORABLE INVESTMENT ATMOSPHERE. It is abundantly clear that your assertions about my claims are completely erroneous.

 

Ha! Ha! You're funny. I just skim read the pages and even I saw the link, and it was a good link.. What kindergarten did you learn to read study economics in?