Are income tax rates progressive enough?

Talk about opinion without evidence. Your understanding of Victorian England and what lead up to it is nil. I just read two books that give a good deal of incite into both periods and your definitely confusong Feudalism and the age of Victoria rather badly or baldly as the case may be.

 

I also hear about fairness from the right wing who want to propose "fair" and "flat" taxes and argue that those who don't pay income taxes aren't paying their fair share. Both sides are obsessed with fairness, not just the left.

So, are taxes progressive enough? No. Most economic growth now goes to the wealthy and while the economy has growth by 2.7% under Trump in inflation adjusted numbers middle class earnings are around 2.5% and when adjusted for inflation they are 0-.5% depending on the numbers you use. Since 1980s the incomes of the rich have risen by over 200% adjusting for inflation while the middle class has stagnated. Also now 65% of growth now goes to the top 1%. We should use tax policy to re-balance growth back to workers.

 

Agree.

 

Those for a progressive income tax would probably be fine if the rich had to pay more for a theater ticket, electricity, water, gasoline, doctors, clothing, and food. Charge a laborer 15 cents for a loaf of bread and charge Bill Gates $100 for a loaf. That is how the income tax works. Does anyone really think it is fair to charge the wealthy more?

 

1. Utterly debunked, not the case, not factual in any sense. Relies on dishonest jiggering of the definition of wealth by gov-edu-union-contractor-grantee-trial lawyer-MSM Complex self-interested hacks to include certain categories of wealth and exclude others.

More importantly, 2. NOT the thread topic, a complete red herring. Not surprised.

To the topic, GL getting a straight answer to how much taxation is fair from LW-Complex. They will not answer it because there is no "enough" for them.

My answer is that government at all levels, including all involuntary forms of "tax," should cost no more than 10-15% of an average working taxpayer's income, maybe 20% for high incomes greater than $250k for a single filer. That should be a strict ceiling, and government should be hard-capped, prevented from borrowing and excess spending to conform with it. That is the most important principle of tax policy IMO. By my informal estimate, average taxpayers pay ~30% of their income in taxes at all levels, and that is grossly excessive.

The LW, most of whom either pay no federal income tax OR a tiny few who make so much they don't care and can hire tax avoidance, look at it as if the government in fact owns everything and "allows" taxpayers to "keep" some of it. Of course parasites who don't pay into the system or pay little in relation to the massive benefits they derive from it see it this way, no surprise there, they are naturally immoral people.

 

And you think that is the purpose of the tax system, to equalize and adjust incomes? Yes even in very hard times for most there will be VERY successful people who make lots of money. That doesn't mean those at the bottom aren't because they are. What is the best way to raise incomes for everyone, raise incomes at the top because that means businesses are being successful and the economy is good, that means full employment and rising incomes for everyone. Raising tax rates on the highest earners does not help workers at the bottom and the middle.

But if the numbers in the OP do not reflect enough progressivity to you what numbers would?

 

When the binoculars are removed, that gives Democrats the goofy idea that the rich deserve to be ripped off much more, and you look at government in it's own stead, you see that to keep us equally interested in government and those holding office, the FAIR system is the FAIR sales tax system.

Oh hell yes the Democrats are loud about taxes, but so they can keep paying none of them. Then they inform us that they do pay federal taxes. Sure social security and direct benefit to themselves taxes. Sure they pay those. But who funds the war fleet of ships? SS taxes do not pay for those airplanes and other arms. Nor do they pay for federal parts of roads. Those SS taxes on workers pay nothing to teachers nor for schools.

So why do Democrats favor high taxes on the rich. For the same reason bank robbers favor robbing banks is what I believe.

 

They also conflate the top 1% in income with the top 1% in wealth thinking they MUST be the same people so raising rates on the top 1% of earners will then get those pesky 1% in wealth and redistribute some of that wealth.

 

It is more than possible to hard cap the feds at 10 percent and it needs to be done. Why?

End deficits. Force the people in DC to adhere to limited budgets. Stop them from looking at the public like we are suckers and must be fleeced. We pay so much more compared to those citizens of say 1900 it is silly. They would have had a massive revolt had they so been taxed.

 

Well, maybe you can use your superior "incite" to show us how the absence of progressive taxes, or federal taxes at all, would lead to widespread prosperity instead of a few ultra-rich and a vast majority of servants? So far in history, there never seemed to be a country to pull that one off.

 

Progressive income tax is de facto violation of the 14th Amendment's Equal Protections Clause.

Change my mind.

 

I can respect that view. I don't agree with it, but to each their own.

I support one tax: a $500 per citizen tax at the voting booth. Don't vote, don't pay.

 

No, I don't think incomes should be equalized, we should just adjust things so that income inequality stays the same as they were in the 50s and 60s. Taxes are the best way to ensure that economic gains are going to workers too.

You say that the best way to raise worker wages is to raise incomes at the top to help businesses. Incomes for the top 1% have risen by almost 300% adjusting for inflation since 1980. Corporate profits have risen from 500 billion in 1980 to 2.5 trillion today adjusted for inflation. In the Trump economic boom conservatives like to tout the GDP is growing by 2.7% after inflation, but worker incomes are only growing by 2.5-2.9% before inflation, and with inflation between 2-3%, this leaves far less than 1% growth. Our expansions is being defined by very small wage growth for workers, yet the economy is growing well, stocks are booming, profits are growing, and unemployment is low.

 

Then it's time to return to a flat tax system. Simplify the tax code, and we'll all get more of our money.

 

You just contradicted yourself in two sentences.

Without a growing economy, with corporate profits incomes will FALL. And adjust GDP for inflation and then applying that to incomes and factoring it by phase of the moon is just more statistical nonsense. Our expansion is now feeling the effects of the tighter labor market and competition for that labor. Amazon just increase wages across to board to attract more and better workers and other retailers are complaining that now they will have to raise wages in order to retain them. That's the market at work.

 

What do you do with someone who runs a personal business with expenses/loses/inventory etc. Don't get me wrong I like the idea of simplified taxes, it's just not that simple to do.

 

Nothing. We eliminate the business/corporate taxes(which will make corporations/businesses happy.) In order to do this and not get every raging liberal in a frenzy, it's time to explain how economics works: Money is circulated through print(the federal treasury), and in local economies, money is circulated through the spending of the economy. Since only the fed may actually print money, most banks only distribute the money already in circulation.

So government taxation historically, has not been for the roads, bridges, public services(that's just the excuse they give. Lip service.) In reality, government taxation served as a point of combating inflation. That's it. Otherwise, you'd have an endless supply of money(See: Weimar Republic for how that turned out in real life.)

A flat tax will suffice for this economic necessity. Meanwhile, increased purchasing power for mostly all citizens(while acknowledging the inevitable draw back that some of the lower rungs will pay higher overall taxes.) will lead to a more productive economy all around.

The other important thing will be reduction of government waste in lieu of the flat tax instead of heavy progressive tax that supports drunk spending and not Middle America.

 

You will have to find a different way to handle small private businesses and their income and expenses.

 

It seems you don't understand what I am proposing. I'd raise taxes on the rich and lower then for workers so that our post-tax GINI index in equivalent to what they were in the 50s and 60s so that all income gains since then will be distributed to workers and to the rich. I don't want to manually go through each person's salary and equalize them, I just want to adjust the taxes so workers have lower taxes and the rich have higher taxes.

So won't this discourage rich people from being successful and they will move away? Americans who live abroad still have to pay US taxes and people abroad who earn money in the US should also pay US taxes. If I am wealthy and I get taxed at 50%, that isn't going to stop me from earning money, in fact I am just to just earn more.

Won't this hurt businesses though? Well, a lot of money rich people earn is for themselves not for businesses. Now, they will probably invest less, but the extra money in the hands of consumers will mean more revenue for companies so it will all balance itself out. I'd also roll business taxes into the income tax so businesses in the US going tax free will help enormously. I'd also greatly simplify our regulations which will also help a lot.

As for your claims, Amazon only raised wages out of social pressure, and are looking to automate jobs. Also, you are looking at only one company and in 2018 wages only grew by 2.9% with inflation between 2.3% and 2.9% so workers really didn't get much in wage increases. Economists are actually very surprised by how poor wage increases have been even with a booming economy and high demand for workers.

 

Life's hard for the rich.
Raise the top bracket to 50% to find the sweet spot.

 

What defines the sweet spot and why would a tax rate of 50% get to that spot. What is your goal here?

Again
If that is not progressive enough, if that is not "fair" what would be? What percent of the tax burden by the top 1% and top 10% would be progressive enough?

 

How much lower and how much more of the tax burden do you want to shift to high earners?

And I think your operating under a misconception about tax rates of the 50's and 60's where there were HUGE deductions and credits. In fact

"When we look at income taxes specifically, the top 1 percent of taxpayers paid an average effective rate of only 16.9 percent in income taxes during the 1950s.[4]"
https://taxfoundation.org/taxes-rich-1950-not-high/

You want to go back to that?

They will certainly have less money to invest and less likely to invest in more risky investments. We collected DOUBLE the capital gains tax revenues at the Bush 15% rate than the Clinton 29% rate and had four times the reconciliations, business activity and growth.

What do you mean "it's not for business"? And for privately owned business most is already in the owners income taxes.

They raised it because the labor market is tightening and they need the best workers. Economist realize we are still getting our LFPR down and bringing people back into the workforce but that the more workers are not available the more upward pressure on wages and salaries.

 

Editing

 

Currently high earners pay about 36% of their incomes in taxes. I'd raise that to about 45%.

I never mentioned tax rates in the 50s and 60s and never expressed any desire to go back to taxes for a completely different economy.

You are only looking at business investment, and just not seeing that the most important thing for businesses is actual revenue and earnings. You can invest all you want in companies, but if they don't see they will earn more by expanding to different locations, then they won't expand. Business investment and profits are at record levels, what we really need to boost is revenue. We can do this by lowering taxes on consumers by raising them on the rich.

I'm not seeing that. Sorry.

I never made the quote "it's not for business" so I don't know what you are referring to. Small business would have zero taxes under my plan so any business profits not going to the owner directly will be tax free. The owner's personal take from the business will be taxed like any other earnings but I think we can do a major tax deduction for small business owners.

Again, you are only pointing out Amazon. If you look at the labor market as a whole wage growth has been surprisingly weak even as the rich and corporations are getting richer and the labor market is tightening. Both left-wing and right-wing economists are having trouble explaining this.

 

As I have mentioned before, I hate Modern American Left.

BUT, I agree with them on Economic issues.

Should one billionaire's "right" to spend billions on luxury items supersede the Right to Life of thousands of poor people who lack health insurance.