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Post 29 Sep 2017, 2:04 pm

Doctor Fate wrote:
geojanes wrote:If you want to get rid of an unnecessary deduction, get rid of the mortgage interest deduction. All that does is make residential real estate more expensive!


1. Won't that cause the real estate market to nosedive, resulting in many in the middle class getting hosed?

2. Won't it result in rental properties either raising their rents or getting dumped?

I guess I wonder with this so a part of the investment/taxation scheme, wouldn't it wreak havoc to eliminate it?


It couldn't be done all at once. It would have to be phased out over time to ease the pain, because you're right, it would be painful. Or perhaps it would be staggered by amounts: you can deduct no more than X amount, this year, X-Y next year, until it gets to zero. But that doesn't mean it shouldn't happen and we would all be better for it. All it does is make housing more expensive because the tax deduction is baked into the cost. Renters and people who pay cash are essentially subsidizing people who have mortgages.

But no one's even proposing that . . .
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Post 29 Sep 2017, 2:38 pm

Doctor Fate wrote:
danivon wrote:
Doctor Fate wrote:So, the higher the State and local taxes are, the less you have to pay in Federal income tax. In other words, more of your income is shielded, thus you are getting subsidized.
It will be marginal though, and when you consider that CA is a net contributor to Federal taxes, is clearly less of a factor than other "subsidies".


It is arguably a "net contributor." The numbers are too close to call.


California is about average. Excepting Wash DC and Delaware, the big losers are Minnesota and New Jersey by both per capita and by gross state product.

https://en.wikipedia.org/wiki/Federal_tax_revenue_by_state
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Post 30 Sep 2017, 1:32 am

Brad, you really believe that a billionaire should pay the same rate as someone making $30K?

That doesn't make any sense to me. We're not playing a game of monoply where we have a set of rules that apply to everyone and therefore wealth should all be taxed equally. Money gives people right to use the wealth that is created by our society. We are not separate atoms that create wealth and the government snatches it from us. We are a society, no one has any wealth prior to the creation of the society, and we should have reasonable rules for how wealth gets used. Money is just chits we used for accessing wealth. So one reasonable rule should be that if you work 2,000 hours at a full-time job you should be able to support yourself with the basic necessities of life. It's ridiculous to me that we would favor a billionaire making as much money as they want with relatively modest inputs while some working poor don't make enough to support themselves. That is why the minimum wage should be $15 a hour.

Imagine we were in a hunter gatherer group 10,000 years ago. And it was getting near winter and there was a big hunt for game. And in this society beads were the currency. And Brad controlled 85% of the beads. And so he says I should get 85% of the meat even though others would starve. Would that happen! Of course not. So thousands of years ago we would have worked together to make sure no one starves but now insist now insist that the market dictates that a person could work full-time and not support themselves.

Right now we have an economy with a financial sector about 7% of GDP but which earns 1/4 to 1/3 of corporate profits. Bank profits are st record highs. Corporations plow money into purchasing company stock to increase their compensation. Our financial sector is too big which has a negative effect on GDP.

https://www.google.com/amp/s/www.theatl ... le/273732/
http://www.foxbusiness.com/markets/2017 ... -2016.html
https://hbr.org/2014/09/profits-without-prosperity
https://www.economist.com/blogs/buttonw ... and-growth

So banks are making profits off of cheap money from the Fed, corporate executives are making money off of increasing the share price by stock buybacks. That is not a lot of of value added by those players.

And of course as those players take more money...you get wealth stratification which is not only unfair but also economically inefficient. Those at the bottom end of the economic spectrum tend to have pent up demand and when they make more money they spend a lot of it. This increases consumer demand, companies can make more products to fill increased demand and they can hire employees to make the products. Economic growth is created.Billionaires already spend a lot and are not going to spend more when they get extra money.

So we are massively rewarding corporate executives and those in the financial sector who are not adding much of anything of value to the economy close to what they are taking out..meanwhile we continue to insist that poor workers not get enough money to pay for basic necessities.

And with all of that money going to the top 1 or 2%...they have excess money to use to influence the political process...to skew things even more in their favor.

So we have systemic problems in our economy that need reforming. These tax cuts do not anything about our economy's real problems.
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Post 30 Sep 2017, 4:59 am

So, what we really need to do is give tax cuts to those who earn no money?

The answer for liberals is always “tax the rich,” unless it’s “tax the workers.”

California: force energy prices higher. Who does that hurt? Those who aren’t rich. Gas taxes? Who does that hurt? Those who aren’t rich. Sales taxes? Those who aren’t rich.

Massachusetts: Tolls. Sales tax. Income tax.

Now, liberals justify high gas taxes because . . . Gasoline hurts the environment, so higher taxes lower gas use.

So, why is it that corporate taxes don’t influence the behavior of corporations?

Hello!

Hundreds of billions of dollars are being sheltered overseas because of our corporate income tax rates.

You complain, freeman3, about complexity benefitting the wealthy. The GOP says “simplify.”

Democrats: “No!”
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Post 30 Sep 2017, 8:20 am

Here's an interesting fact.
U.S federal, state, and local taxes totaled 26.4 percent of GDP in 2015, nearly 8 percentage points below the 34.3 percent OECD average.

http://www.taxpolicycenter.org/

Americans complain about being over taxed and US business complains high taxes make it noncompetitive. But when viewed objectively the situation is not that at all...

The top 1 percent would be the biggest winners under Republicans' plans to rewrite the tax code, according to a new analysis, while some moderate-income people would face tax increases.
Though the administration says the wealthy would not see their taxes go down under the proposal, the Tax Policy Center said Friday that they would actually reap the biggest cuts — about half of all the tax benefits in the GOP plan. In 2018, the wealthiest 1 percent would take home a $129,000 tax cut, the group found, boosting their after-tax incomes by 8.5 percent.
Most other people would see their taxes decline as well, albeit not by nearly so much. Those in the center of the income spectrum would see a $660 tax cut, the group said, which translates into a 1.2 percent increase in after-tax income.
By 2027, about 30 percent of those earning between $50,000 and $150,000 and 60 percent of those taking home between $150,000 and $300,000, would pay more under the Republican plan.

http://www.politico.com/story/2017/09/2 ... ore-243310

So all this tax cutting is going to benefit the wealthiest and the deficit is going to be driven up drastically.... Who's talking about deficits now? Who's talking about ruining your children's future with debt? Debt in this case that will be created because rich people got richer..

Decades of experience and evidence has shown that when working people and middle class people have more money they spend more. When they spend more the consumer economy grows... (71% or more of the US economy)
The same experience proves that when the rich have more money, they don't tend to invest or spend domestically.
Since 1980 and Reagan Americans have bought into the notion that they need to give rich people more money by cutting their taxes, in order for prosperity to be achieved. . . And all thats really happened is the rich got richer.
Whats different this time? Oh, Trump fooled some idiots into voting for his lies so that this could happen.
https://thinkprogress.org/trump-tax-cut ... 74ca9729b/

Hows that swamp draining coming along?
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Post 30 Sep 2017, 8:35 am

rickyp wrote:Americans complain about being over taxed and US business complains high taxes make it noncompetitive. But when viewed objectively the situation is not that at all..


Only you would look at non-corporate taxes and use them to "prove" that statement.

Even Politifact rated the statement that the US has the highest corporate rate in the world as "mostly true."

Bolling said the United States has "the highest corporate tax rate in the free world." He was referring to the statutory rate, meaning the rate before deductions. On that score, he’s right: The United States does have the highest statutory rate among developed countries. However, the United States’ corporate tax rate doesn’t appear to be the highest once deductions and other exclusions are taken into account. So Bolling is correct by one valid definition. Because his statement is accurate but needs clarification or additional information, we rate his claim Mostly True.
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Post 01 Oct 2017, 4:37 am

Just one thought on the state tax deduction: most of the tax savings go to the wealthy. Per congress, 88% of the deduction goes to families making more than $100,000 per year and just 1% of the deduction goes to families making less than $50,000.

With an increase in the standard deduction in Trump's plan, even more of the deduction will benefit the wealthy.

To pass the legislation, perhaps the right answer is to cap the deduction at $20,000 or something like that.
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Post 01 Oct 2017, 9:49 am

Fate
Even Politifact rated the statement that the US has the highest corporate rate in the world as "mostly true.

Yes, you tend to agree with any BS statement that confirms your world view...

Poliitfact rated the "statement" mostly true.
They didn't agree that US corporations paid the most taxes... In fact they said ...

However, the United States’ corporate tax rate doesn’t appear to be the highest once deductions and other exclusions are taken into account.


The US tax code is written to benefit those who write it... The last few decades its been written by corporations and their lobbyists.

http://www.npr.org/sections/itsallpolit ... e-the-bill

When lobbyists no longer write the laws....then maybe tax laws will be simpler, easier to understand and fairer.

rayjay
To pass the legislation, perhaps the right answer is to cap the deduction at $20,000 or something like that

Or maybe you write a law that provides one tax rate in each state. A comprehensive tax rate that simply adds the percentage of the standard federal rate for each bracket. to whatever each state wants to add on...
Making everything transparent. And eliminating complexity.
Complexity being the ally of those with the accountants and lawyers..
So that they have loop hole statements they can make like:
"The US has the highest corporate tax rate in the free world" , to deflect from the reality of what they actually pay...
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Post 01 Oct 2017, 11:21 am

rickyp wrote:Fate
Even Politifact rated the statement that the US has the highest corporate rate in the world as "mostly true.

Yes, you tend to agree with any BS statement that confirms your world view...


Mostly true from liberal Politifact means nothing to you.

Of course, you have nothing to add. But, what do you care? You're Canadian.
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Post 02 Oct 2017, 6:00 am

Ricky:
rayjay
To pass the legislation, perhaps the right answer is to cap the deduction at $20,000 or something like that

Or maybe you write a law that provides one tax rate in each state. A comprehensive tax rate that simply adds the percentage of the standard federal rate for each bracket. to whatever each state wants to add on...
Making everything transparent. And eliminating complexity.
... and ignoring the constitution.
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Post 02 Oct 2017, 6:01 am

Ricky:
When lobbyists no longer write the laws....then maybe tax laws will be simpler, easier to understand and fairer.


You don't seem to realize that the lobbyists are the ones trying to prevent this tax law changes which gets rid of certain prized deductions.
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Post 02 Oct 2017, 9:28 am

rayjay
You don't seem to realize that the lobbyists are the ones trying to prevent this tax law changes which gets rid of certain prized deductions

But are they lobbying against state tax deductions or just the ones affecting their industries?

It’s an accepted truth among Republicans that any attempt at broad-based reform will face intense lobbying from business interests trying to protect provisions in the complicated code that benefit them. But the state and local deduction is different because it lowers taxes not for a specific industry, but for the populations of entire cities and states—or at least those who itemize their taxes rather than take the standard deduction.
The argument against allowing people to deduct state and local taxes off their federal bill is that the policy acts as a subsidy for those states. “I don't think it's fair that a bunch of other states are subsidizing New York and California,” Treasury Secretary Steven Mnuchin said Sunday on ABC’s “This Week,” while noting that he’s “sympathetic” to the concerns of local officials.

https://www.theatlantic.com/politics/ar ... an/541557/

Or maybe you write a law that provides one tax rate in each state. A comprehensive tax rate that simply adds the percentage of the standard federal rate for each bracket. to whatever each state wants to add on...
Making everything transparent. And eliminating complexity.
... and ignoring the constitution

How? In what way?
Its called a homogenized tax rate... The federal amount would be the same across the country. States would differ so every state might have a different homogenized rate.
Much easier to compare.
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Post 02 Oct 2017, 9:34 am

ricky:
rayjay
You don't seem to realize that the lobbyists are the ones trying to prevent this tax law changes which gets rid of certain prized deductions

But are they lobbying against state tax deductions or just the ones affecting their industries?


I've already explained that 88% of the benefit of this deduction goes to individuals making more than $100,000 per year, and only 1% goes to those making les than 50%. Stop protecting the rich.

Ricky:
How? In what way?
Its called a homogenized tax rate...


There are 50 states that get to make their own tax policies. The feds cannot mandate that. Please don't waste our time discussing how 50 states need to change their tax laws.
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Post 03 Oct 2017, 11:12 am

Yes, Freeman, I do believe that. I know we have different values, but I think there is assistance available for the people less paid. My question is why does the government have the right to treat people differently?

A person making 35K a year would pay $3,500 tax and nothing after the standard deduction. A person making 350K would pay 35K and still a lot of tax is left after the standard deduction. Both pay 10%, and one doesn't pay anything after a standard deduction. That sound and is fair, as they both pay the same percentage. Both get the same deduction.

I want people treated equally by the government. Do you?
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Post 03 Oct 2017, 1:05 pm

You're not treating people equally when you tax everyone at the same rate. Why? Because dollars do not have static values. When you take money out of the first $35,000 someone makes you may be depriving them of food, of shelter, of clothing, of health care...of the basic necessities of life. That's not true with regard to 315-350K. Every dollar has more concrete value in the real world when you are making $35,000 then each dollar over $100,00, over $300,000, over $1,000,000. I don't think there can be any argument. It is pretty inarguable that each dollar has more of a real world effect at low incomes than each dollar does for high incomes. Therefore, it is not fair to tax dollars the same as incomes rise. That is the justification for progressive rates.

Where our system has gone completely off of the rails is not taxing not high enough at high rates of income. Your right to enjoy the wealth of our society should bear some relationship to what you contribute by THINGS YOU DO. Let's say a reasonable amount of work is 2,000 hours a year. What do you think the maximum value of a persons's labor (excluding inventions) is per hour? $1,000 an hour, $2,000 an hour, $5,000 an hour? This is would correspond to a max earned income of 2 million, 4 million and 10 million, but of course those are pretty exorbitant per hour fees. What I would is have a graduated rate of 50% for every dollar earned between 1 million and 5 million, 70 percent between 5 million and 10 million, and 90 percent of incomes over 10 million. (You could have an exception for extraordinary inventions.) The present rates are ok up to 1 million. The justification for the high rates is that there is no way a person is providing real value to the economy to justify that kind of income. And once we stop rewarding pursuit of such unjustified and unearned incomes...there will be less of an incentive to cut ordinary workers out of any gains in the economy. And I would tax capital gains at the same rate as ordinary income. Why would we favor money made by doing nothing over labor? You don't need to incentivize investment by having lower taxes--people got to put their money somewhere.