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| The timing of Steinbrenner's death; ...saves his family $500 million | |
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| Tweet Topic Started: Jul 14 2010, 12:18 PM (694 Views) | |
| Piano*Dad | Jul 14 2010, 02:13 PM Post #26 |
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Bull-Carp
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Frankly, I would prefer a straight consumption tax. Tax systems that tax savings four or five times are ones that encourage the wrong kind of thinking about the future. |
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| KlavierBauer | Jul 14 2010, 02:14 PM Post #27 |
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HOLY CARP!!!
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+1 |
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"I realize you want him to touch you all over and give you babies, but his handling of the PR side really did screw the pooch." - Ivory Thumper "He said sleepily: "Don't worry mom, my dick is like hot logs in the morning." - Apple | |
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| jon-nyc | Jul 14 2010, 02:18 PM Post #28 |
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Cheers
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No, which is why 55% is way too high. I'd support a cap at 15-20%. |
| In my defense, I was left unsupervised. | |
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| jon-nyc | Jul 14 2010, 02:18 PM Post #29 |
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Cheers
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You're not concerned about the regressivity? |
| In my defense, I was left unsupervised. | |
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| Axtremus | Jul 14 2010, 02:20 PM Post #30 |
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HOLY CARP!!!
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Exactly. Just treat them as income tax and set rates/caps like your would income tax. |
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| KlavierBauer | Jul 14 2010, 02:23 PM Post #31 |
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HOLY CARP!!!
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That sounds acceptable - we should just pay income tax on the same money twice. That really encourages me to tuck something away for my kids, so that they can get hit with the burden of paying income tax on it - again. Of course it's fair - because Mrs. KB and I would be wealthy land baron/baroness's if we didn't have to pay that darn estate tax. |
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"I realize you want him to touch you all over and give you babies, but his handling of the PR side really did screw the pooch." - Ivory Thumper "He said sleepily: "Don't worry mom, my dick is like hot logs in the morning." - Apple | |
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| Piano*Dad | Jul 14 2010, 02:24 PM Post #32 |
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Bull-Carp
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Taxing bequests is taxing income that has already been taxed. That discourages saving. The bequest motive remains a powerful reason for people to save, after all. Absent a clear social rationale (those evil feudal families cannot be allowed to control all the levers of power!!!) I see no persuasive rationale for taxing bequests at all. |
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| Piano*Dad | Jul 14 2010, 02:27 PM Post #33 |
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Bull-Carp
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You deal with that by having exemptions. This is a well studied idea, and many economists pushed hard for it in the 80s. The politics of changing the tax system, however, is very difficult. Making anything other than marginal tinkerings has proved almost impossible. |
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| jon-nyc | Jul 14 2010, 02:27 PM Post #34 |
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Cheers
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No, for the recipients its new income. Plus, for most estate money that qualifies, very little was ever taxed as income. Bill Gates never paid a single penny of tax on his MSFT holdings. |
| In my defense, I was left unsupervised. | |
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| jon-nyc | Jul 14 2010, 02:32 PM Post #35 |
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Cheers
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It seems it would necessarily reduce government revenues, probably dramatically. Since the prime beneficiaries (say, 90-99.9th percentile) pay most of the taxes. Case in point, my federal income tax is more than twice what I pay on all other expenses combined. I'd obviously pay far, far less under a consumption tax. On the proposals you've seen, where do they suggest setting the rate? It seems we'd need it to be 25% just to pay for defense and interest on the debt. |
| In my defense, I was left unsupervised. | |
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| Axtremus | Jul 14 2010, 02:37 PM Post #36 |
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HOLY CARP!!!
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Exactly! I use my already-taxed income to pay my piano technician. That's "pre-tax income" for that technician. Senior leaves his already-taxed savings to Junior. That's "pre-tax income" for Junior. Pretty straight forward concept, no? |
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| KlavierBauer | Jul 14 2010, 02:43 PM Post #37 |
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HOLY CARP!!!
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Your piano technician isn't your descendant for whom you're leaving a gift - he's providing a service for a fee, I really don't see how that's comparable to estate tax. It is taxed as income because it is his main source of income. Other gifts are exempt from taxable income, why not estates and/or bequests? |
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"I realize you want him to touch you all over and give you babies, but his handling of the PR side really did screw the pooch." - Ivory Thumper "He said sleepily: "Don't worry mom, my dick is like hot logs in the morning." - Apple | |
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| Piano*Dad | Jul 14 2010, 02:52 PM Post #38 |
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Bull-Carp
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It isn't. It's defining income in a way to get your result. |
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| Piano*Dad | Jul 14 2010, 02:58 PM Post #39 |
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Bull-Carp
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Look, taxing bequests reduces saving. That's an incentive effect. You may not care, and thus you may want to define bequests as income even though they are just an intra-family transfer of assets. Many things affect incentives perversely. We tax dividends, despite the fact that they have already been taxed as corporate profit. This double taxation discourages saving, as well as discouraging payment of dividends in favor of retained earnings. We do lots of things that deliberately discourage saving. Maybe we should take some of that Obama brain power to figure out ways to reduce the disincentives for people to take the long run view. |
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| jon-nyc | Jul 14 2010, 03:01 PM Post #40 |
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Cheers
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Dividends should be tax deductable for the corporation but taxed for the individual. |
| In my defense, I was left unsupervised. | |
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| Piano*Dad | Jul 14 2010, 03:01 PM Post #41 |
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Bull-Carp
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Indeed. |
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| jon-nyc | Jul 14 2010, 03:09 PM Post #42 |
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Cheers
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Bump for P*D |
| In my defense, I was left unsupervised. | |
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| Axtremus | Jul 14 2010, 03:21 PM Post #43 |
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HOLY CARP!!!
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+1 |
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| Piano*Dad | Jul 14 2010, 03:22 PM Post #44 |
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Bull-Carp
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Jon, If my memory serves, which it may not, I think percentages for a consumption tax in the mid-20s were talked about back in the 80s. |
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| jon-nyc | Jul 14 2010, 03:25 PM Post #45 |
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Cheers
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I don't see how that would accommodate current defense spending plus interest on the national debt. |
| In my defense, I was left unsupervised. | |
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| Axtremus | Jul 14 2010, 03:27 PM Post #46 |
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HOLY CARP!!!
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Heck, a piano tech can tune a piano for me as a gift as much as I can give him $100 as a gift. Even as gifts, it's tax exempt only up to $13k per year per receipient. For Piani*Dad, yes, it is good to encourage savings, but not that good to encourage hoarding. At some point, saving crosses the line onto hoarding. Tax policy should recognize the existence of that line somewhere. |
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| Piano*Dad | Jul 14 2010, 03:43 PM Post #47 |
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Bull-Carp
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And you know the line? Someone's hoard is what others borrow. |
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| John D'Oh | Jul 14 2010, 03:45 PM Post #48 |
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MAMIL
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Back in the old Thatcherite years, conservatives talked about cutting costs before cutting taxes. Now, it seems to be suggested that it be done the other way around. I simply can't imagine why this wouldn't work. |
| What do you mean "we", have you got a mouse in your pocket? | |
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| jon-nyc | Jul 14 2010, 03:46 PM Post #49 |
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Cheers
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Reagan proved deficits don't matter. |
| In my defense, I was left unsupervised. | |
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| Piano*Dad | Jul 14 2010, 03:48 PM Post #50 |
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Bull-Carp
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I really haven't thought about this since I was in a graduate public finance class in 1980. A few revolutions around the sun have occurred since then. I seem to recall that a consumption tax under 30% could completely substitute for the current income tax system, even including exemptions and deductions to maintain some progressivity. Remember, consumption is over 75% of national income. The trick in making a consumption tax work is to make the base as broad as possible, i.e. the exemptions should be lump sum based on dependents and on basic maintenance of body and health. If you exempt certain kinds of consumption (food, for instance) you are on a slippery slope to a collapsing loophole-ridden system .... hey, sort of like the current one! |
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