Why cut taxes?

[Uncle Ted]

It's extremely frustrating that a tax bill that would explode the deficit beyond its already obscene level would still make this many more middle class Americans pay thousands of dollars more in taxes. This is the most idiotic thing the GOP has ever tried to do on taxes. Even if only 40% of middle America has to pay more, that's more than enough angry voters to vote people out at the ballot box. I don't get it.

Yeah, the government should be raising the corporate tax rate to 75%+ to lower the deficit instead! All those stink'n corporations have all the money. They need to pay up!

Consider yourselves warned you evil corporations!

[BlueK]

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I only skimmed this article, but the graphs and analysis was very interesting. Figured some here would also like it.


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It's extremely frustrating that a tax bill that would explode the deficit beyond its already obscene level would still make this many more middle class Americans pay thousands of dollars more in taxes. This is the most idiotic thing the GOP has ever tried to do on taxes. Even if only 40% of middle America has to pay more, that's more than enough angry voters to vote people out at the ballot box. I don't get it.

[Moliere]

Embedded Tweet

I only skimmed this article, but the graphs and analysis was very interesting. Figured some here would also like it.


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[cowboy]

Sounds like a great argument to close some loopholes, not eliminate the tax.

I guess that depends on your intent. If you are just looking at revenue, and don't want kids to be able to live the easy life as a result of the work of their parents, you are right. If you want to provide people with further incentive to be productive and grow the economy, I think eliminating it entirely makes sense. If you recognize that the estate tax is relatively insignificant as a revenue source, but want to stick it to the rich kids, then you raise the allowable limit to $20 million in 2017 dollars and close loopholes. Even though the foundations are created partially or completely for tax purposes, I would bet that they create more benefit for the buck than any government agency tasked with the same purpose, so I don't know that closing loopholes is an effective move, either. That's why I come back around to eliminating the estate tax altogether, but closing some of the loopholes that provide stepped up basis, etc., while keeping the basic non-profit foundation incentive in place. I do think that none of the sheltered money should be used for political purposes or lobbying for causes, even though that would probably have negative (to me) unintended consequences.

[Jeff Lebowski]

It's not just the republicans who are in the pockets of the rich.

This excellent article from the WSJ explains how the super rich avoid taxes, especially estate taxes. This is why I'm opposed to the estate tax: Unless you are so rich that you can dump most of your wealth into a tax-free entity, you get dinged. Estate taxes thus hit the new money, and family money that has been managed for the next generation but is nowhere near the level of the rich elite. These are the families whose wealth is tied up in a working small business, and who are hurt the most by estate taxes, all while the uber-rich that people are trying to get to with estate tax laws skate away untouched.

Some notable excerpts.

Sounds like a great argument to close some loopholes, not eliminate the tax.

[cowboy]

It's not just the republicans who are in the pockets of the rich.

This excellent article from the WSJ explains how the super rich avoid taxes, especially estate taxes. This is why I'm opposed to the estate tax: Unless you are so rich that you can dump most of your wealth into a tax-free entity, you get dinged. Estate taxes thus hit the new money, and family money that has been managed for the next generation but is nowhere near the level of the rich elite. These are the families whose wealth is tied up in a working small business, and who are hurt the most by estate taxes, all while the uber-rich that people are trying to get to with estate tax laws skate away untouched.

Some notable excerpts.

Congress is still scrambling to find ways to pay for its tax cut, so perhaps it should pay closer attention to last month’s news that George Soros had transferred $18 billion of his fortune to a private charity that he controls. There it will be sheltered from the Internal Revenue Service forever. This may be the single biggest tax dodge in U.S. history, yet no one on the right or left seems to have raised an eyebrow.

True tax reform is predicated on the principle that all income should be taxed at a low rate once, and only once. But much of the wealth that Mr. Soros spent years moving into his Open Society Foundations will never be taxed. A gift of billions of dollars of appreciated stock escapes any capital gains tax, and the estate tax as well. So Mr. Soros can donate appreciated stock that Open Society Foundations can liquidate without the government ever taking a cut.

Congress should stop ignoring this tax-avoidance scheme. The super rich have already poured hundreds of billions into private foundations, but the figure could soon be in the trillions. Mark Zuckerberg has pledged to give away 99% of his Facebook shares, currently estimated to be worth somewhere around $70 billion, and much of it will go to a foundation his family controls. Bill Gates and Warren Buffett have each put roughly $30 billion tax-free into the Bill and Melinda Gates Foundation. This has left the foundation so flush that it spent $500 million on a 12-acre, 900,000-square-foot office complex in Seattle for its 1,500 employees. This is philanthropy?

I don’t question these billionaires’ right to do with their money as they wish. I’m simply arguing that Congress shouldn’t let the rich and politically powerful use private foundations to escape taxation. This loophole is one reason for an anomaly in our otherwise progressive tax code: The top 1% of earners pay an effective tax rate of 23%, but the top 0.001% pay only 18%.

[BigPiney]

Now every grad student who gets a tuition waiver will have to pay tax on the tuition waived. Good idea!

That is just stupid.

Hopefully it won't pass the senate.

[PaloAltoCougar]

Now every grad student who gets a tuition waiver will have to pay tax on the tuition waived. Good idea!

Apparently Congress needs to do this to offset the ongoing carried interest benefit for fund managers. It bugs me that on the rare occasion when a Congressman is asked why they haven't eliminated the carried interest (this allows fund managers to have the millions they earn for their services, not invested capital, taxed at essentially half of ordinary income rates), they squirm and say that they had to make some compromises in order to get tax reform. So far as I am aware, no one has come forward to actually defend carried interest treatment, and yet it remains.

I'm aware of current and former fund managers who love(d) the carried interest feature, but who also thought it was wrong and should be eliminated. The only person I've ever heard defend it was the poster formerly known as Viking.

[BlueK]

"I love the poorly educated!"

so let's try to have more of them! More votes...well, as long as they're white.

[Applejack]

Now every grad student who gets a tuition waiver will have to pay tax on the tuition waived. Good idea!

"I love the poorly educated!"

[Maximus]

Now every grad student who gets a tuition waiver will have to pay tax on the tuition waived. Good idea!

[BlueK]

Republicans can stop pretending they care about the deficit.

They care enough to give a tax increase to much of the middle class to lessen the effect of the huge tax break to the ultra rich. Stupidities like this are paving the way to a massive drubbing in 2018

[Uncle Ted]

Republicans can stop pretending they care about the deficit.

Yeah... and who cares if those companies move their HQ's out of the country? F them for not caring about the deficit as well!

Edit: Sh*t! When did Burger King move to Canada?!? I am never buying a burger from that hoser king again!

[Topper]

Yep. I agree with this.


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Republican legislators don't care. And this is always the problem with those campaigning on promises to limit government. First, it is harder to do than to promise. Second, your people want things from the goodie bad too.

[Moliere]

Republicans can stop pretending they care about the deficit.

Yep. I agree with this.


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