I'm Confused

[101A]

I thought the United States had the most beneficial tax roles for the rich. I was wrong.
http://www.bbc.com/news/magazine-26327114

TAKE HOME for people making $400K:

These are their findings. In each country, the wage earner takes home the following proportion of his or her salary.

• Italy - 50.59% (takes home $202,360 out of $400,000 salary)
• India - 54.90%
• United Kingdom -57.28%
• France - 58.10%
• Canada -58.13%
• Japan - 58.68%
• Australia- 59.30%
• United States - 60.45% (based on New York state tax)
• Germany - 60.61%
• South Africa - 61.78%
• China - 62.05%
• Argentina - 64.02%
• Turkey - 64.64%
• South Korea - 65.75%
• Indonesia - 69.78%
• Mexico -70.60%
• Brazil - 73.32%
• Russia - 87%
• Saudi Arabia - 96.86% (so you take home $387,400 out of the $400,000 salary)

TAX RATE for average earner:

These tax rates apply to single people with no children, on an average salary for their country.

• Belgium- 42.80%
• Germany - 39.90%
• Denmark - 38.90%
• Hungary- 35%
• Austria -34%
• Greece - 25.4%
• OECD Average - 25.10%
• UK - 24.90%
• USA - 22.70%
• New Zealand - 16.40%
• Israel - 15.50%
• Korea - 13%
• Mexico -9.50%
• Chile - 7%

The following tax rates apply to married couples with two children.

• Denmark - 34.8%
• Austria - 31.9%
• Belgium- 31.8%
• Finland -29.4%
• Netherlands - 28.7%
• Greece 26.7%
• UK - 24.9%
• Germany - 21.3%
• OECD average - 19.6%
• USA - 10.4%
• Korea - 10.2%
• Slovak Republic - 10%
• Mexico - 9.5%
• Chile - 7%
• Czech Republic - 5.6%

It looks like some of those social welfare plans are paid with taxes from the middle class, not the rich. Go figure.

So confusing.

[Will Hunting]

Strawman. when people refer to "the rich" not paying enough taxes, they're not referring to the guy who lives in Manhattan and has an annual salary of 400k that gets hit by the 40% marginal rate, they're referring to the guy who's paying 20% on his seven figure income that's primarily cap gains and dividends. Most of the liberals i know including myself think taxes on someone's first 500k of standard income should either stay where they are or go down with a more progressive tax plan.

That study is also incredibly incomplete since it doesn't account for estate tax in each country.

[ChumpDumper]

I thought the United States had the most beneficial tax roles for the rich. I was wrong.
http://www.bbc.com/news/magazine-26327114

TAKE HOME for people making $400K:



TAX RATE for average earner:



It looks like some of those social welfare plans are paid with taxes from the middle class, not the rich. Go figure.

So confusing.

Do you live in New York?

[spurraider21]

using income tax rates to judge how much tax the rich pay

[Will Hunting]

using income tax rates to judge how much tax the rich pay

To be fair, it seems like that study is estimating effective tax rates.

Either way, I'd hardly consider someone who makes 400k and lives in NYC "rich", especially if that's the income of someone supporting a family of four.

[spurraider21]

To be fair, it seems like that study is estimating effective tax rates.

Either way, I'd hardly consider someone who makes 400k and lives in NYC "rich", especially if that's the income of someone supporting a family of four.

disagree there... 400k puts him pretty up there. less than 7% of earners in NYC are making over 200k, let alone 400

[101A]

Do you live in New York?

No Pa.

Unfortunately, the survey only includes what it includes. Criticism noted, however.

To be honest, I was more interested in the fact that the "average" earner in many European countries pays a higher tax rate than his/her peer here.

[101A]

Strawman. when people refer to "the rich" not paying enough taxes, they're not referring to the guy who lives in Manhattan and has an annual salary of 400k that gets hit by the 40% marginal rate, they're referring to the guy who's paying 20% on his seven figure income that's primarily cap gains and dividends. Most of the liberals i know including myself think taxes on someone's first 500k of standard income should either stay where they are or go down with a more progressive tax plan.

That study is also incredibly incomplete since it doesn't account for estate tax in each country.

I agree; there are taxes paid by the truly wealthy that are far more important than the income tax on wages, but that does not stop politicians and other talking heads from using the income tax rate when hammering a point (after all the Bush tax cuts were all about saving the rich money, weren't they - and those were income tax cuts). We can look at decade old threads on this very forum where that point was made many times.

I would like all income to be treated the same; regardless of source (investment or earned).

Estate tax is a separate issue; but worth discussing.

[SpursforSix]

Yellow in front.
Brown in back.

[boutons_deux]

all income to be treated the same; regardless of source (investment or earned).

yep, and progressive at MUCH steeper rates.

[101A]

all income to be treated the same; regardless of source (investment or earned).

yep, and progressive at MUCH steeper rates.

Income Rate
$0.00 0%

Then what?

[cheguevara]

400k is not rich in this country IMO

it's well off but not rich.

the beef is with the top say 400 richest americans who have more wealth than the bottom 150 million americans combined.

these ppl have entire teams of lawyers and accountants in charge or reducing their tax contributions. (loopholes)

[Will Hunting]

I agree; there are taxes paid by the truly wealthy that are far more important than the income tax on wages, but that does not stop politicians and other talking heads from using the income tax rate when hammering a point (after all the Bush tax cuts were all about saving the rich money, weren't they - and those were income tax cuts). We can look at decade old threads on this very forum where that point was made many times.

I would like all income to be treated the same; regardless of source (investment or earned).

Estate tax is a separate issue; but worth discussing.

Yeah I totally agree there are politicians and also people like the occupy heads (muh 99% ) who oversimplify taxation and argue over stupid like a 5% difference in the standard tax rate. That's largely by design from both political parties since it keeps people distracted from the real problems with our current tax code.

Anyway, I think we pretty much agree on how the first 400k of someone's income should be taxed. What I would do is simply stack more tax brackets on top of that, it makes no sense for our top marginal rate to be for all income in excess of 439k when there's a class of people in America who make exponentially more than that. I would also replace the earned income tax credit with something that doesn't incentivize certain people to not work.

regarding estate taxes, your OP referenced the tax role rich people play in America, wouldn't you agree estate taxes are part of that?

[SpursforSix]

400k is not rich in this country IMO

it's well off but not rich.

the beef is with the top say 400 richest americans who have more wealth than the bottom 150 million americans combined.

these ppl have entire teams of lawyers and accountants in charge or reducing their tax contributions. (loopholes)

they're talking about making 400K per year. assuming you're not a crack head or have several ex wives, that should get you well on the way to rich.

[Cry Havoc]

In the 1950s, the richest portion of the tax bracket were taxed at over 90%. Amazingly, they were still rich.

[boutons_deux]

Income Rate
$0.00 0%

Then what?

duh, no taxes. you get the rich people's taxes to keep you eating, clothed, housed

[SpursforSix]

duh, no taxes. you get the rich people's taxes to keep you eating, clothed, housed

for you it's "brown in front, brown in back"

[boutons_deux]

for you it's "brown in front, brown in back"

for you it's "brown between the ears"

[spurraider21]

i know its pretty out there, but i've always thought the idea of replacing federal income tax with a federal sales tax would be interesting. food/groceries dont get taxed. that way, the people who get by living paycheck to paycheck give virtually nothing, but fat cats buying boats, cars pay all the taxes.

probably not feasible to implement, but the notion seems alright

and not the herman caine 9-9-9 bull . scrap the personal income tax and make the sales tax significantly higher

[Will Hunting]

Income Rate
$0.00 0%

Then what?

I would ditch the payroll taxes completely for employees and employers, abolish the corporate income tax while ins uting a 1% wealth tax on all individual wealth in excess of $10 million with that number adjusting for inflation every year. I would also ins ute a 10% matching tax for employers/corporations on all dividend payments, stock repurchase and any individual salary or bonus that's in excess of 10x the average worker wage as a matching tax amount (i.e. If the average worker makes 50k and the CEOs total compensation is 2,000,000, the company would have a 150,000 tax liability). I would also repeal any employer healthcare requirements and replace them with universal healthcare, in my opinion employer based healthcare does nothing but handicap small businesses that can't offer the same benefits as companies with a large pool of employees.

Regarding what the actual tax rates would be, that would depend on estimated revenue needed to pay our debt down over a reasonable time period. These are just the fundamental changes I would make up front to encourage innovation and jobs.

[boutons_deux]

i know its pretty out there, but i've always thought the idea of replacing federal income tax with a federal sales tax would be interesting. food/groceries dont get taxed. that way, the people who get by living paycheck to paycheck give virtually nothing, but fat cats buying boats, cars pay all the taxes.

probably not feasible to implement, but the notion seems alright

and not the herman caine 9-9-9 bull . scrap the personal income tax and make the sales tax significantly higher

flat tax is highly regressive, is why it's perennially hyped the the 1%.

a study showed that poor people in TX already pay a higher %age of the income taxes than the rich people.

[spurraider21]

flat tax is highly regressive, is why it's perennially hyped the the 1%.

a study showed that poor people in TX already pay a higher %age of the income taxes than the rich people.

thats because rich people dont pay income tax, they pay capital gains. but there's no getting around sales tax

the idea i threw out there isn't suggesting a flat income tax. its scrapping income tax

[Will Hunting]

i know its pretty out there, but i've always thought the idea of replacing federal income tax with a federal sales tax would be interesting. food/groceries dont get taxed. that way, the people who get by living paycheck to paycheck give virtually nothing, but fat cats buying boats, cars pay all the taxes.

probably not feasible to implement, but the notion seems alright

and not the herman caine 9-9-9 bull . scrap the personal income tax and make the sales tax significantly higher

The fat cats buying boats are still spending a much smaller percentage of their income on the nonessential goods you want to tax than a middle class family that takes a vacation every year, owns two cars, goes out to dinner a few times a week, etc., it's still a very regressive tax that barely touched the rich even if groceries aren't taxed.

[Will Hunting]

thats because rich people dont pay income tax, they pay capital gains. but there's no getting around sales tax

the idea i threw out there isn't suggesting a flat income tax. its scrapping income tax

Sure there is. The ultra rich only spend a small portion of their income, thus a sales tax barely touches them. Middle class people who spend 80% of their income would get hit a lot harder than the rich.

The 18% tax warren buffet pays on his Berkshire Hathaway gains/dividends is still a much bigger number than the sales tax he would potentially pay. Even if there were a 100% sales tax, I doubt buffet spends even close to 18% of his income on non essential goods.

[101A]

duh, no taxes. you get the rich people's taxes to keep you eating, clothed, housed

I think you misunderstood.

I was asking for your brackets - I know we can agree no money = no taxes, then what brackets would be YOUR ideal.

You suggest MUCH more progressiveness.