Tax changes???

[SonomaCat]

I don't care what the impact is, It is just fare! Why punish the rich. Again, if it has to work that way then come out and say we are going to screw the rich because that is the only way it works. And make sure that fire truck gets to their home 10x faster.

Gary do you assume that the rich people that we are discussing are rich because of their hard work?

The rich people that we are discussing on this thread are rich through inheritance not hard work. Why should they have no significant tax burden? Look at the homes and cars that they own simply because of their last name? It isn't like the government is taking all their well earned money. This conversation is ridiculous. You would want a flat tax that would most likely increase poverty in America simply to be "fair" to rich people? We would solidify our caste system with such a move! Our government already does too much for wealthy America. Lets at least make the rich people pay for all the benefits that they reap from our society.

most people are rich because of hard work and lifestyle/career choices.

A certain segment certainly does fit that mold, but many others (or perhaps most others) are either born into it or got lucky. Either way, the coded language embedded into this discussion is that people who are poor are just lazy and deserve to be poor.

My family certainly benefitted from lower marginal tax rates when they were starting out, and I am now more than happy to pay a higher rate of tax than somebody making $20K a year (like my brother, a first year teacher in MT). It just seems to make sense to me, and I have no problem with it. If we changed the system to a pure flat tax, it would simply shift the tax burden from the rich people to the poor people. That just makes no sense.

If we want to go to a philosophical level and talk about the value that government provides various people, it can be argued that rich people benefit more from government than poor people, and should therefore pay more. The theory holds that rich people have a lot more to lose than poor people, so it is in their best interest to maintain a stable society to protect their assets. In the lack of a functioning government, the poor people take all of the rich people's stuff by force. That would be bad for rich people, so they have incentive to pay more to uphold the current structure of our government.

This was the mindset that ultimately brought us the New Deal in the 30s. It was guys like Joe Kennedy who supported such plans of wealth redistribution, not out of overt altruism, but because a society that falls into anarchy sucks for soon-to-be-former rich people (see French Revolution). That's why we have the structure we do -- to maintain the status quo to some extent with a few idealists hoping that we can actually lift the poorer people into a better position in life by putting most of the tax burden on those who can afford it.

It seems to be a pretty good system, actually. We can argue forever about what tax rates are perfect, but the idea of a progressive tax rate structure is virtually a no-brainer these days, outside of discussions like this.

['93HonoluluCat]

If we changed the system to a pure flat tax, it would simply shift the tax burden from the rich people to the poor people. That just makes no sense.

BAC, how do you figure that? Fifteen percent (that's the number I've heard most often) of anything is fifteen percent. You can do the math...lower incomes will pay less, higher incomes will spend more--but everyone pays the same percentage. How is that more of a "burden on the poor?":-s

If we want to go to a philosophical level and talk about the value that government provides various people, it can be argued that rich people benefit more from government than poor people, and should therefore pay more.

Wha...

[Hell's Bells]

If we changed the system to a pure flat tax, it would simply shift the tax burden from the rich people to the poor people. That just makes no sense.

BAC, how do you figure that? Fifteen percent (that's the number I've heard most often) of anything is fifteen percent. You can do the math...lower incomes will pay less, higher incomes will spend more--but everyone pays the same percentage. How is that more of a "burden on the poor?":-s

If we want to go to a philosophical level and talk about the value that government provides various people, it can be argued that rich people benefit more from government than poor people, and should therefore pay more.

Wha...

i am glad i am not the only person wondering what he is typing...
id hate to break it to people but if a rich and a poor person pay 15% flat tax the rich person still pays more...

[SonomaCat]

Not to be a smartass (as I proceed to say something smartass), but when I say "shift the tax burden from rich people to the poor people" and you guys are acting like I am not making sense, is it a math lesson or a semantics lesson that you are needing?

Rich people pay a lot of tax. Poor people pay very little tax. If you have a flat tax, it SHIFTS that tax burden from the rich to the poor (and at the end, they are equal as a function of %).

As to the "wha" part ... please read the rest of the post that explains what that theory holds, and then let me know if you find errors in the rationale. Do you not believe that anarchy is bad for wealthy people's assets? And if so, can you see a theory that would hold that paying more taxes is essentially an insurance policy for the wealthy to have a strong government to protect their wealth?

And on a human level, I just don't quite understand why anyone would suggest that someone who is struggling to put food on the table should pay the same rate of taxes as somebody who has more money than they know what to do with. Why not give people who need more help some tax breaks? We give tax breaks to businesses that need help, why not poor people? Well, just the hard-working poor people, that is.

[Hell's Bells]

Not to be a smartass (as I proceed to say something smartass), but when I say "shift the tax burden from rich people to the poor people" and you guys are acting like I am not making sense, is it a math lesson or a semantics lesson that you are needing?

Rich people pay a lot of tax. Poor people pay very little tax. If you have a flat tax, it SHIFTS that tax burden from the rich to the poor (and at the end, they are equal as a function of %).

As to the "wha" part ... please read the rest of the post that explains what that theory holds, and then let me know if you find errors in the rationale. Do you not believe that anarchy is bad for wealthy people's assets? And if so, can you see a theory that would hold that paying more taxes is essentially an insurance policy for the wealthy to have a strong government to protect their wealth?

And on a human level, I just don't quite understand why anyone would suggest that someone who is struggling to put food on the table should pay the same rate of taxes as somebody who has more money than they know what to do with. Why not give people who need more help some tax breaks? We give tax breaks to businesses that need help, why not poor people? Well, just the hard-working poor people, that is.

same percent....different total amount of dollars when sumed up...figured ud know that

also isnt 15% lower then the 25% payroll tax everyone that is poor is subjected to anyways

[SonomaCat]

What country has a 25% payroll tax? I'm going to go out on a limb and assume that you aren't all that familiar with the actual tax rates that different people pay and the impact that switching to a flat tax would actually have on different people. Just trust me, a flat tax would dramatically increase the taxes paid by poor people and would dramatically reduce the taxes paid by rich people. If that's what you think is good policy, that's fine. I just happen to disagree.

The word "shift" is still causing some problems, but I'm a little too busy with work to care.

[Hell's Bells]

What country has a 25% payroll tax? I'm going to go out on a limb and assume that you aren't all that familiar with the actual tax rates that different people pay and the impact that switching to a flat tax would actually have on different people. Just trust me, a flat tax would dramatically increase the taxes paid by poor people and would dramatically reduce the taxes paid by rich people. If that's what you think is good policy, that's fine. I just happen to disagree.

The word "shift" is still causing some problems, but I'm a little too busy with work to care.

i will trust you but i think you are talking about serious gray area

are you also figureing into your opinion tax refunds??

[mquast53000]

This thread should be killed immediately! When BAC and GL are on my side with an argument you know something just isn’t right.

HB & Honolulu- I know you guys are good republicans, but have you been so brainwashed by the party that now you guys are sticking up for the extremely rich?

HB I was also a little surprised that you think the wealthiest 5% of the population earned their money through hard work. You don’t truly believe that do you? I suppose you also believe anyone can be President of the United States. Look at Bush he never had any outside influences help him become President.

[jagur1]

Quast I don't disagree with you. (& i havn't read this thread) but didn't Paul Allen, Bill Gates & Waren Buffet not earn the money?

[Hell's Bells]

This thread should be killed immediately! When BAC and GL are on my side with an argument you know something just isn’t right.

HB & Honolulu- I know you guys are good republicans, but have you been so brainwashed by the party that now you guys are sticking up for the extremely rich?

HB I was also a little surprised that you think the wealthiest 5% of the population earned their money through hard work. You don’t truly believe that do you? I suppose you also believe anyone can be President of the United States. Look at Bush he never had any outside influences help him become President.

quaist i will conside to you that there are wealthy who inherit their money from their folks but by in large those people end up squandering their money while making themselves look like spoiled brats *example...paris hilton*

however as what jag said there is a lot of people who put their good name on the line to make themselves succsessful

1) rush limbaugh...yes i know he came from inherited wealth but he is a college dropout who just loved being a radio jockey and who bounced from job to job with his best job being with the KC royals in sales.

2) Steve jobs

3) Bill gates is a college dropout

[SonomaCat]

What country has a 25% payroll tax? I'm going to go out on a limb and assume that you aren't all that familiar with the actual tax rates that different people pay and the impact that switching to a flat tax would actually have on different people. Just trust me, a flat tax would dramatically increase the taxes paid by poor people and would dramatically reduce the taxes paid by rich people. If that's what you think is good policy, that's fine. I just happen to disagree.

The word "shift" is still causing some problems, but I'm a little too busy with work to care.

i will trust you but i think you are talking about serious gray area

are you also figureing into your opinion tax refunds??

Please just trust me. I am right. I know what I'm talking about. No gray area. Tax refunds don't help your argument.

A flat tax would dramatically increase taxes for poor people and dramatically lower taxes for rich people.

I am not offering opinions, I am speaking of facts from over 10 years of working in the tax profession.

This is a close to the word of God as anything you will ever hear from me.

[Hell's Bells]

What country has a 25% payroll tax? I'm going to go out on a limb and assume that you aren't all that familiar with the actual tax rates that different people pay and the impact that switching to a flat tax would actually have on different people. Just trust me, a flat tax would dramatically increase the taxes paid by poor people and would dramatically reduce the taxes paid by rich people. If that's what you think is good policy, that's fine. I just happen to disagree.

The word "shift" is still causing some problems, but I'm a little too busy with work to care.

i will trust you but i think you are talking about serious gray area

are you also figureing into your opinion tax refunds??

Please just trust me. I am right. I know what I'm talking about. No gray area. Tax refunds don't help your argument.

A flat tax would dramatically increase taxes for poor people and dramatically lower taxes for rich people.

I am not offering opinions, I am speaking of facts from over 10 years of working in the tax profession.

This is a close to the word of God as anything you will ever hear from me.

ok fine

[SonomaCat]

It should also be noted that a flat tax would devastate the average taxpayer in Montana and would be a huge windfall for California, New York and Connecticut.

Just food for thought.

[Grizlaw]

quaist i will conside to you that there are wealthy who inherit their money from their folks but by in large those people end up squandering their money while making themselves look like spoiled brats *example...paris hilton*

Oh come oh HB; now you truly are talking out the wrong end. It's fine to have disdain for the old money clique, but you can't hold up Paris Hilton as the example and then assume that she is the "typical" society girl.

Would you make similar comments about members of the Mars, Dupont, Rockefeller, Ford, or Carnegie families? Or, more to the point, do you actually know of more examples of members of such families "squandering their money and making themselves look like spoiled brats" than people who have "earned" their money? People of every station in life make jackasses of themselves on occasion, but I don't think you can prove that "old-money" types are categorically more prone to bad behavior than the nouveau riche.

(Sorry to go off-topic; I don't want this comment to hijack the thread away from the primary tax policy debate, but I just found that quote to be a bit odd.)

As for the flat tax vs. progressive tax debate, I think a lot of the disagreement on this thread comes from people misunderstanding what others meant by certain terms. If I have time later, I may go back and try to re-phrase the argument; I can't do it right now...

--GL

[SonomaCat]

1) rush limbaugh...yes i know he came from inherited wealth but he is a college dropout who just loved being a radio jockey and who bounced from job to job with his best job being with the KC royals in sales.

2) Steve jobs

3) Bill gates is a college dropout

This is kind of funny. So to illustrate the nobility of rich people who earned their money, you present the stories of two college drop-outs whose parents were rich who just (shock!) happened to have the resources to eventually become rich themselves! Yeah, you gotta love those "pulling up by their bootstraps" stories about people who never had to do it because the folks were footing the bill for them to take risks with other people's money.

Even Jobs came from a solidly middle-class family.

Now think about families that actually are poor, and are trying to raise their kids and get them through school (assuming these kids don't have the luxury of dropping out without being very, very poor themselves). Should they be paying taxes at the same rate as Bill Gates' rich parents?

[SonomaCat]

And sadly, Paris Hilton makes a lot of money. She's a hard worker, she is.

[mquast53000]

Quast I don't disagree with you. (& i havn't read this thread) but didn't Paul Allen, Bill Gates & Waren Buffet not earn the money?

They sure did, but did Helen, Alice, S. Robson, Jim, Christy Walton (#5-10 richest Americans)? How about Anthony & Anne Cox (#12 & 13) or Forrest, Jacqueline, John Mars (#19-21)? I picked names that we would all recognize. On Forbes.com it says, “Source: Inherited” for all of these people.

I also don't think Paris Hilton will "squander" her family’s wealth away. I think the Hilton Empire will survive her party girl ways.

Back to the point of this thread, I don’t think the extremely rich should have the benefit of a flat tax because it is “fair.” Fair would mean we all start from an even playing field. There would be no inheritance, and therefore there would no advantages given to one family over another. Of course this isn’t the case. The richest children go to the best schools, and make the best connections and get the best jobs despite their abilities. It is much harder to become a millionaire then it is to lose millions. Americans are brainwashed thinking that anyone can become rich with a little hard work and know how. It is the biggest deception out there. I was born to a middle class family and statistically speaking, I will live my life as a middle class citizen. The same can be said about poor and rich alike. A person is born into their class, and seldom do they escape what they were born into. Anyone can think of a few examples of people that have gone from nothing and become something (Bill Gates or Michael Jordon), but American society needs these individuals to keep the illusion alive. If it wasn’t for these people breaking the barrier Americans would realize that there is no “American Dream” and that would be unsettling to our society.

But enough from me, I am sounding more like BAC and that is just plain scary!

[SonomaCat]

It gets easier with time, Quast, it really does. Go into the light, and ignore that creepy little lady with the weird voice who is trying to convince you otherwise (Poltergiest reference, just in case you have a creepy little ladies that you work with or something that could be confused for what I was writing).

[gtapp]

If you want to be specific, let's take my case. I started my company in 1991. 15 years later we have had about 7 good years and 8 bad years. Sold everything I have owned on more than one occasion to keep it going. Been about two days away from bankrupcy twice and when times were good I had to put money into savings and into the company. The problem with this definition of rich is that when you make a little money ($100K+) the IRS puts you into a category where not only do you pay a MUCH higher percentage but they minimize your deductions (no child deductions, etc.). Even if you have had four bad years in a row they want everything now! When you have a bad year and you have all of these losses they minimize your losses and then make you spread what is left over several years. After all of the Bood, Sweat and Tears I have put into this if I ever get my just deserved money I will be damned if I am going to give it all to the government!

A flat tax would still require that the higher incomes pay the most. At 10% flat tax, someone making $100K pays $10K and someone making $20K pays $2K. The rich still pay more just not a higher percentage.

If nothing else increase the amount you have to make before the percentages get so high. 0-$75K is one bracket. $76K-$150K is the next and $150K- $300K is the next and so on.

[gtapp]

If you want to make the argument that half of the rich people in this country did not earn their fortune, I can understand and agree with that position. But you must in turn admit that half of the poor people and maybe a healthy percentage of the middle class are lazy.