Comment by d3ckard
9 hours ago
Common misconception IMO.
High marginal taxes and high inheritance taxes do not affect the rich - they eliminate competition for them.
I do agree on antitrust and antimonopoly though.
9 hours ago
Common misconception IMO.
High marginal taxes and high inheritance taxes do not affect the rich - they eliminate competition for them.
I do agree on antitrust and antimonopoly though.
If they don't affect the rich, why have the rock didn't so much time, effort, and money eroding such taxes over decades?
Eroding them is beneficial to other groups of society, not the rich.
It's like with corporations. Corporations love complex legal systems, as they are the only ones with money to deal with them. Simplification actually benefits smaller enterprises.
How is high marginal taxes and high inheritance taxes not simple?
If complexity is the problem then close the loopholes that let people get out of this.
America was not supposed to be a country of monarchs and wealthy dynasties, and high inheritance taxes helped towards that goal.
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How come they eliminate competition? What if inheritance taxes are progressive?
Yeah, it seems like most people assume there is a reach and scope of taxation that isn't really possible. Wealth can be expatriated, it can be in non-fungible objects (paintings, &c), it can be in goods held in common such that no transfers occur (for example, a house that people live in together and jointly own).
There isn't anywhere an index or lookup table of all legal rights a particular person has to wealth (or, in truth, to "things", since anything can be worth something and contribute to wealth). There are things they may have a right to that they don't even know about.
They can hide wealth (at their own risk) but it prevent them from extracting money from the country:
The cannot own houses, factories, monopolistic contracts o media. It makes harder to influence politics ( in a legal way).
The housing issue is specially important because city space is limited and the demand is very inelastic
Money is important as a vector for power. It doesn't matter that much whether a person has a bunch of paintings in a Swiss vault when they're an institutional investor directing a substantial sector of the economy. And that industrial power is relatively easy to divest them of, as compared to vault paintings.
That's true, but most of those can be cracked down on simply by saying that any undeclared wealth is forfeit. Also, the great proportion of most rich people's actual wealth is in forms that are easier to trace (e.g., shares of corporations, real estate).
Problem does not lay in not declaring wealth.
I'd be curious to know more, this is quite unintuitive
Generally, there are no systems that are 100% bulletproof. This applies to everything. So, the more power you have, the more likely you are to exploit the existing loops.
Who is actually affected? Those less powerful. Progressive tax system hits the middle class (actual middle class, la petite bourgeoisie, not the modern bullshit redefinition of the term) hardest, making it harder for them to make it rich and compete with actual rich people.
As the effect, rich protect inheritance by trusts and avoid taxes by not having income (plenty of tricks available with borrowing), while people like doctors, lawyers, small business owners fund the state and hit hard limits on what can they make.
Don't believe me? Check how much of the tax income comes from top brackets. You may be surprised. Pro tip: system is very skewed to the top.
If the problem is that the system is very skewed to the top, then isn't the solution to be found in addressing that skew? In closing those particular loopholes?
Shouldn't everyone pay their fair share of taxes? Warren Buffett and others seem to think that they should.
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