happyhoix
Distinguished Associate
Joined: Oct 7, 2011 7:22:42 GMT -5
Posts: 20,882
|
Post by happyhoix on Sept 14, 2021 13:46:52 GMT -5
I am not a tax or financial person. My financial goal has always been to earn more than I spend and ferret the extra into savings, and that’s pretty much it.
So I was interested to here opinions from better financial minds than mine on something I heard two talking heads discuss this AM. The wealth gap right now (I just looked it up on statists) has 70 % of the wealth belonging to the top 10 percent. The remaining 90 percent of the population gets 30%.
The middle class - those in the 50 to 90 percentile - Have lost the most. In 2002 they had 36%, and now they are at 28%.
So, the talking heads say the only way to fix such inequality is to stop taxing the income of the super rich, who often have no wages income, but start taxing their dividends.
Is this right, and is this what we should do? If not, how do we keep more middle class people from sliding down into the bottom 40 percent?
|
|
djAdvocate
Member Emeritus
only posting when the mood strikes me.
Joined: Jun 21, 2011 12:33:54 GMT -5
Posts: 75,086
Mini-Profile Background: {"image":"","color":"000307"}
|
Post by djAdvocate on Sept 14, 2021 13:57:20 GMT -5
I am not a tax or financial person. My financial goal has always been to earn more than I spend and ferret the extra into savings, and that’s pretty much it. So I was interested to here opinions from better financial minds than mine on something I heard two talking heads discuss this AM. The wealth gap right now (I just looked it up on statists) has 70 % of the wealth belonging to the top 10 percent. The remaining 90 percent of the population gets 30%. The middle class - those in the 50 to 90 percentile - Have lost the most. In 2002 they had 36%, and now they are at 28%. So, the talking heads say the only way to fix such inequality is to stop taxing the income of the super rich, who often have no wages income, but start taxing their dividends. Is this right, and is this what we should do? If not, how do we keep more middle class people from sliding down into the bottom 40 percent? not really.
there is "passive income" (ie, flow trough income from S-Corps, dividends, and capital gains) and there is "active income" (wages, salaries, benefits, earnings). right now, "passive income" is massively tax advantaged, even though it is the LEAST EFFICIENT (see below) way to stimulate the economy. the MOST EFFICIENT way to do so is to tax the shit out of passive income. let me explain why.
passive income has very little utility to a rich person. a rich person will invest it, which will remove it from the public sphere and put it in the corporate sphere (at best), or even worse, it will become some fixed or offshore asset, where it produces no value for anyone other than the asset holder.
active income is SPENT, for the most part- which drives the engine called the economy.
if we were SMART about taxation, we would have HIGHER tax rates for passive income than active income, since it would create more "economic turns", result in higher growth, and engender far less poverty/subsistence living than taxing active income. but at the very least, we should tax them the same.
PS- the thing about "double taxation" is complete bullshit. there is absolutely NO justification for treating income more favorably if it comes from investment than labor. none. it is pure elitism and punishment for anyone without assets.
|
|
sesfw
Junior Associate
Today is the first day of the rest of my life
Joined: Dec 21, 2010 15:45:17 GMT -5
Posts: 6,268
|
Post by sesfw on Sept 14, 2021 14:52:18 GMT -5
Sounds good to me.
For years I've thought the first $12-15K income should be tax free, ie. W-2, 1099, etc. This would cover a lot of SS recipients, and other low income earners. Then have a flat percentage tax on the rest.
Dividends should be taxed. Also the first $12-$15K be tax free. So the smaller investors are protected. The rest taxed as regular income.
I don't know about deductions and such. Especially with single income families. Someone a lot smarter than I am will have to figure that out.
I'm the greatest buck passer in the world.
|
|
Tiny
Senior Associate
Joined: Dec 29, 2010 21:22:34 GMT -5
Posts: 13,365
|
Post by Tiny on Sept 14, 2021 14:57:47 GMT -5
Isn't that what the standard deduction is all about:
Filing Status 2021 Standard Deduction Single; Married Filing Separately $12,550
Married Filing Jointly $25,100
Head of Household $18,800
|
|
djAdvocate
Member Emeritus
only posting when the mood strikes me.
Joined: Jun 21, 2011 12:33:54 GMT -5
Posts: 75,086
Mini-Profile Background: {"image":"","color":"000307"}
|
Post by djAdvocate on Sept 14, 2021 15:08:55 GMT -5
Isn't that what the standard deduction is all about: Filing Status 2021 Standard DeductionSingle; Married Filing Separately $12,550 Married Filing Jointly $25,100 Head of Household $18,800 I would favor a "living wage" carve-out per household (adjusted annually) with a flat rate above that. very simple tax code.
|
|