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OT: No more income taxes
- Penn State Football
- 131 Replies
Behind a paywall. Try again.Here’s the type of tax model you should be discussing…
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OT: No more income taxes
- By PaoliLion
- Penn State Football
- 131 Replies
1. Your graph indicates that not even the top 1% bracket spends only 30% of income. So the info you post contradicts itself and it is not sourced. What is the source of the data, provide a link.
2. Most of the very wealthy live off of assets not earned income.
- America's 25 wealthiest people got $401 billion richer from 2014 to 2018, according to Forbes.
- ProPublica reported the income taxes they paid amounted to just 3.4% of that new net worth.
- One way the ultra-rich America's billionaires avoid taxes: borrowing money at low-interest rates, according to ProPublica. America's billionaires have often financed their lavish lifestyles by using their vast fortunes as collateral for loans, which can come with single-digit interest rates.
- Investor Carl Icahn also took advantage of borrowing money, paying $0 in federal income taxes despite reporting an adjusted gross income of $544 million, as he had an outstanding loan with Bank of America worth $1.2 billion, ProPublica reported.
- Elon Musk has similarly put up a massive amount of his equity in Tesla and SpaceX as collateral for loans, rather than sell those shares and pay 20% in capital gains tax to free up the money. From 2014 to 2018, Musk paid $455 million in taxes on a reported income of $1.52 billion, resulting in an effective tax rate of 29.9%. But his wealth grew by $13.9 billion during that time, meaning his "true tax rate," according to ProPublica's methodology, was just 3.27%.
- In 2014, for example, Oracle cofounder Larry Ellison disclosed he had used 250 million of his Oracle shares as collateral to secure a $9.7 billion personal line of credit.
The wealthiest Americans avoided billions in taxes by voluntarily doing something most only do out of necessity: borrowing money.
Income taxes: 37%. Capital gains: 20%. ProPublica found billionaires avoid those by borrowing from banks at interest rates of less than 10%.www.businessinsider.com
3. I and many others are proposing that instead of income tax that we tax consumption. The ultra wealthy consume at much higher rates as illustrated above but fully understand how to not pay much in income tax. If you tax consumption, they are still going to consume.
Here’s the type of tax model you should be discussing…
Subscribe to read | Financial Times
News, analysis and comment from the Financial Times, the worldʼs leading global business publication