March 20, 2023

Fair Share - Household Income/Taxes Update

Question: if somebody works a little harder, longer or smarter, or becomes more productive or even get's a little luckier and makes another dollar what is the most the government should be able to take?

When I ask this question of people across socioeconomic levels I find wide agreement that something like 25-33% sounds fair.

Now, when you combine state and local taxes and the higher taxes being proposed by the Biden Administration, you see that individuals will be taxed much more than 50%. How much higher should tax rates be, to be fair?

I happen to think that if somebody works a little harder, longer or smarter, or becomes more productive or even get's a little luckier and makes another dollar that it is UNFAIR for government to take more than half.

I also think it is intellectually dishonest and hurting our country when the President claims that people are not paying their fair share. Biden distorts the truth by confusing and conflating income and wealth. He greatly distorts his version of tax rates by taking only capital gains rates, which ignores the explicit effect of corporate tax rates on income generated by investment, and then he counts the increase of wealth of individuals ownership interest in companies, even though this wealth hasn't been recognized and may not even be keeping pace with inflation. 

Based on the most recent CBO Report on Household Income, 2019 released November 2022, It's clear that the rich are paying a disproportionate share of the taxes and that there is a progressive tax rate.

I also think that it is crazy that government safety nets actually disincentivize the lower quintiles from trying to make more by actually implicitly taxing increased earning at 100% as benefits are lost as income rises.


https://twitter.com/moxlosllc/status/1650655976947630082?s=46&t=Y4fVsDnz2q8uZ3VNKeco4A

 

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