Warren Buffett: Tax me and the rest of the wealthy more

Sales taxes (VATs) are inherently regressive, hurting the poor and middle income disproportionately. If I make $50,000 I'm likely to spend nearly 100% of my income and ergo have 100% of my income subject to tax. If I make $1,000,000 I might only spend half, meaning that only 50% is subject to tax. Even though both people pay the same rate, on it's face, in reality the $50k guy effectively pays a double rate.


Once you start making exemptions, the devil is in the details, and you go down that slippery slope to loopholes.

What we need is a progressive tax system largely devoid of loopholes!

Icarus

 

The only two problems I see in your example is that you don't account for what the million dollar person is going to do with the other 500 thousand. Stick it in a mattress?
Nope. S/he is going to stick it into the market somewhere, invest it in a startup, or whatever.
The other thing that you may not have thought about is the fact that a NST, VAT, or whatever hip, focus group tested name for a sales tax that you choose would capture much of the wage earners that are flying under the radar with our current "system."
Drug dealers, hookers, illegal immigrants, etc have to spend at least some of their money on tangible goods.
A sales tax would capture some of this missed 'income'. Heck....we could even quibble over what you consider to be "poor" in this country and rebate NST funds back to our disadvantaged brethren.

I will agree with half of what you said.....our "progressive" system needs to be denuded of all loopholes. Sorry EV buyers....this means YOU too! That would help some.
If you want to thwack zillionaires with a huge penalty on their ill gotten booty, then I'm sure that some of them might just stick around and pay up.
If you could develop and pass a tax code that would fit into one dime store novel sized book, then at least we wouldn't need all of the sniveling, bet-wetting, bottom feeder attorneys to do their taxes.

These days, I take my victories where I can find them....

 

We are strictly talking (about the VAT) as a tax collection mechanism. The million dollar guy isn't going to stick in in the matress, just as he doesn't now. Right now investment income is largely taxed at capital gain rates.

As I suggested before, if you move to a sales based (VAT) it is intently regressive, and hits the poor and middle income harder, as a percentage of income.

Like I also said, if you start rebating to the "poor" you find the slippery slope. Do you rebate stair step, of flatly. Once you rebate at all, you are back to the land of loop holes.

Icarus

 

45 States already impose sales taxes.....41 states impose income taxes as well...although two of these graciously "only" tax interest and dividend taxes. This might impede my beloved federal government from getting much traction on adding an additional National Sales Tax.
Then there's property tax, capitol gains (tax 'em again) tax, estate tax, gas tax, gift tax, corporate tax, payroll tax, excise tax, thumb tax, carpet tax...OK...I was just seeing if you were paying attention.
Pretty soon we're going to be paying "more" tax.....
(*sigh!*)
Taxed Enough Already???

 

Estate tax doesn't really come into play unless you have, last I heard, over $5 million, which doesn't come into play for most average Americans, and there are many ways to change that by using trusts and other things. Gas tax doesn't pay for all the transportation infrastructure that WE demand, you don't want to pay for roads and bridges that you use? Very few corporations pay the corporate tax or corporate tax rate. Are we taxed enough to pay for the things that make this country great, would be a better question.

 

NO.

Taxes are a poor substitute for proper economic pricing. If prices covered all the costs, we wouldn't need taxes to make up the shortfall. Until full, long term costs are formally recognised in overall pricing structures, we'll continue to stumble blindly, causing all sorts of environmental damage and running up massive deficits. Our current economic model is deeply flawed. Overpopulation and overconsumption are only beginning to show the depth of the problem.

 

I would submit that we probably are but due to an inefficient, bloated, self-serving government, funds are not reaching their designated projects. Of course funding wars all over the place doesn't help either but neither does dysfunctional government run programs either.

 

So that's why we are laying off techers, firefighters, police? Why we are about 10th in infrastructure spending? Why a huge percentage of our roads, bridges, airports etc are substandrd relative to world averages?

This is all due to " inefficient, bloated, self serving government"?

I think not!

Icarus

 

You know who hates taxes on the rich? Not the rich (just ask Warren Buffett) but the people who would benefit from taxes on the rich.

 

Gosh Ick, I don't know where to start with the amazing rebuttal? Um, but I will try. Having worked for state level agencies with frequent contact with federal counterparts, I have seen the an amazing about of waste through inefficiencies and just plan incompetence. In fact the ol' saying goes "you will rise to your level of incompetence.". And no, I have not made it very high up the chain. There is simply no accountability. It is almost impossible to get fired these days.

Now I will say I have seen some really sharp people working for the agencies but would have to say it was a wash. I mean even being to the point that it is amazing anything gets accomplished.

Don't get me wrong, there is definitely a crucial role for the government but it should be thin and streamline and virtually invisible IMO.

Cheers

 

When you want to do something, you don't look around for a consensus. Or a poll.

You don't wait for congress to send you a bill.

You just be like George Bush, Jr. You go out and do it.

Obama needs to get off his nice person and lead.

 

Right now my boss is doing what every first-term President tries to do...get a second term! That's it. I mean.....I'm sure he's a pretty sincere guy and everything, and having read his books, I'm thinking that whoever wrote his books is trying to portray a man who really is trying to leave the country a little bit better than he found it.
If you're not impressed with his testicular fortitude, well......what can he do? The founding fathers came up with this little "checks and balances scheme" that gives the POTUS zero spending power. As much as everybody fusses about how much he's spent thus far......he can't and hasn't spent squat! This means that he has to work with the Congress Critters if we're going to get anything really done, and this has been his and their biggest failure.

He'll probably succeed in getting Obama 2.0 BTW, so you 'blue' guys and gals out there don't really have anything to worry about.....I mean...they re-elected his predecessor, right?
The only two things he really has to worry about is Joe Biden getting a sudden promotion, or the economy really REALLY tanking. Then.....it's not Obama-2.0, it's Jimmy Carter 2.0.....

 

Well he is currently better then anything the Teaicans have come up with.

 

Obama is unable to lead his own party. He certainly doesn't know how to lead the Republicans. How many of his own party voted for his budget? I'll give you a hint... The vote in the Senate was 97-0

 

Why are you only able to get 42 mpg in an 08? I get 52+

Icarus

 

I run the air conditioner pretty much all the time, I drive too fast on Atlanta highways and my tires are not over inflated.

 

The top 1% of AGI already pay 38% of the taxes. But that, the tax on income. We don't tax wealth the same way. Next time you hear a politican say we need to tax the wealthy, demand that he explain who he will tax and is he talking about taxing income or wealth. Estimates based on the Forbes wealthiest 400 Americans suggest that their total wealth wouldn't cover the outflow from the treasury for even 6 months.

Congress must curtail spending at a greater rate that they raise taxes. No bill should come out of congress without a law to fund it 100%.


Tax Year 2008

Percentiles Ranked by AGI
AGI Threshold on Percentiles
Percentage of Federal Personal Income Tax Paid
Top 1%
$380,354
38.02
Top 5%
$159,619
58.72
Top 10%
$113,799
69.94
Top 25%
$67,280
86.34
Top 50%
$33,048
97.30
Bottom 50%
<$33,048
2.7​

Note: AGI is Adjusted Gross Income
Source: Internal Revenue Service​

Sorry, submitting trashed the table.

 

The following quote is from the late Dr. Adrian Rogers (1931-2005) It's one long quote, but I broke it up into its constituent points. I don't agree 100-percent with this perspective, but I'm not down with LBJ's "Great Society" either.
It is a powerful perspective nonetheless.
As they used to say on "The Twilight Zone"...
Submitted for your (dis)approval:


You cannot legislate the poor into freedom by legislating the wealthy out of freedom....

What one person receives without working for, another person must work for without receiving....

The government cannot give to anybody anything that the government does not first take from somebody else...

When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that, my dear friend, is about the end of any nation...

You cannot multiply wealth by dividing it....

 

anybody who is willing to live in the custom provided by government assistance is welcome to it. anyone who wants to get ahead will work to get ahead as long as there is a goal worth working toward. i don't think the people on wall street are going to quit and start farming because we tell them they are going to have to pay 500 million of their one billion in taxes.

 

A more relevant question is what percentage of the total wealth in this country is controlled by the top, say 10%? How has that changed in the last 30 years?

What percentage of total "income" do these same 10% receive?

Icarus