Tax hikes - Yay or Nay?

[merithyn]

Yes Meri.  We can all read. 

I wasn't sure. Your post made it unclear.

The thing you need to understand is your question misses the most fundamental issue in most tax codes.  Marginal rates are meaningless if the tax code permits high income earners to avoid the marginal tax percentage and the higher the marginal tax percentage the more incentive high income earners have to avoid it.

So go ahead and make the assumption that raising marginal tax rates will increase tax revenue.  But dont be surprised if you assumption doesnt come true.

Golly gee, thanks, Wally! I would never have known that without you!

[merithyn]

Well the same has me saying "No way, no how"

Okay.

[OttoVonBismarck]

Simplistic understanding of tax policy by someone who is a proven intellectual light weight, not too surprising.

[merithyn]

Simplistic understanding of tax policy by someone who is a proven intellectual light weight, not too surprising.

As if the intricacies of the tax code in the US hasn't been discussed ad nausea here. I assumed that you "intellectual giants" would be able to include that in your voting. I didn't realize that it was beyond you to do so.

[DGuller]

Simplistic understanding of tax policy by someone who is a proven intellectual light weight, not too surprising.

As if the intricacies of the tax code in the US hasn't been discussed ad nausea here. I assumed that you "intellectual giants" would be able to include that in your voting. I didn't realize that it was beyond you to do so.

Don't lump all of us into the same category.  I for one did include the intricacies of the tax code into my voting.

[merithyn]

Don't lump all of us into the same category.  I for one did include the intricacies of the tax code into my voting.

That's 'cause you're an intellectual lightweight, like me.

[garbon]

Don't lump all of us into the same category.  I for one did include the intricacies of the tax code into my voting.

That's 'cause you're an intellectual lightweight, like me.

Doesn't seem like you did - given the one-sided simple statement that you made. Well that and your 60s tax code support.

[crazy canuck]

I would never have known that without you!

Once you get past all your normal defensiveness you may come to appreciate that raising the marginal tax rate on middle class tax payers makes little sense if the goal is to have the rich pay their fair share through an across the board increase.  That is why your question which assumes some form of progressive across the board tax increase is deeply flawed.

But you knew that, you claim, and still asked the question.  Curious.

[crazy canuck]

Don't lump all of us into the same category.  I for one did include the intricacies of the tax code into my voting.

That's 'cause you're an intellectual lightweight, like me.

You realize it is possible to answer your question in a manner that recognizes that the question is flawed.

[merithyn]

Doesn't seem like you did - given the one-sided simple statement that you made. Well that and your 60s tax code support.

Which one? Apparently, every statement I make is a simple statement.

The '60s tax code "support" was just answering GF's question of what the tax rate was then. Admittedly, I was being a bit facetious about using the 90% rate, but I do still believe that we should raise taxes. For the record, I voted the third option, because I don't believe that raising taxes is the only answer. I like that we have a system in place to cut the budget automatically, and I'd like to keep it. At the same time, I favor universal healthcare supported by private insurance companies through subsidies. Cuts alone won't get us that. Ergo, I favor a significant increase in the tax rates.

As for the tax codes, as I stated, I don't think that there's a single individual in the United States that doesn't believe that that's necessary. In fact, it's never even a question anymore. What is in question is "how" to do it, and since there are at least two fundamental beliefs on how to do so and no one can come to a consensus, we have to deal with what we have until they can get their heads out of their asses.

[DGuller]

In my opinion, what needs to be changed is the investment income taxation.  Corporate taxes should be eliminated entirely, but capital gains and dividend income need to be taxed as regular income.

[crazy canuck]

Meri, think about the simplistic answers you posted.  "Yes, I am in favour of a tax hike because we need more tax revenue".  Your approach is overly simplistic because it ignores the issue of tax avoidance which you say you understand.

So please, square that circle for us.

I suspect that when you posted the poll you really did think that increasing marginal rates would create more tax revenue.  But it isnt so simplistically true.

[crazy canuck]

In my opinion, what needs to be changed is the investment income taxation.  Corporate taxes should be eliminated entirely, but capital gains and dividend income need to be taxed as regular income.

That is an interesting suggestion.  I think it has some merit and would certainly go a long way to eliminate tax avoidance.  If the US took this step other Western Countries would be fairly quick to follow.

[merithyn]

Once you get past all your normal defensiveness you may come to appreciate that raising the marginal tax rate on middle class tax payers makes little sense if the goal is to have the rich pay their fair share through an across the board increase.  That is why your question which assumes some form of progressive across the board tax increase is deeply flawed.

But you knew that, you claim, and still asked the question.  Curious.

I disagree. I think a nominal increase on the middle class is a good idea. Not for the cash generated, but more for the idea that they are a part of the process that is giving them health insurance, a military, a decent infrastructure, and a retirement option.

I think that one of the biggest differences between the 1950s and 1960s is how the population sees how the government works. Back then (before the Vietnam War, anyway), taxes went toward making the country better. Now, people see it as squandered with no return on that investment. I think making severe cuts in areas that need them (primarily the bureaucracy and departmental bloat that the current cuts seem to be getting rid of) while raising taxes for a purpose (Universal healthcare, Medicare,  Social Security, infrastructure) might help to reverse that trend.

There's a major branding issue going on. Those opposed see it as "socialism", and that's what's beat into the public eye. But not all socialism is bad, and when broken down and asked as individual questions, most Americans want those systems in place. I can't see having those things without severe cuts and a severe tax hike.

Yes, it's far more complex than that. I realize that I have a somewhat rudimentary understanding on how the systems would work in action. However, I don't doubt that as a general theory, I'm correct.

Mind you, none of this takes into account the regulations that allow companies to dodge a huge chunk of taxes, too, and yes, changing those is essential toward getting us to the long-term goal. That is, however, a different beast than whether we should tax the individual more or not.

[merithyn]

Meri, think about the simplistic answers you posted.  "Yes, I am in favour of a tax hike because we need more tax revenue".  Your approach is overly simplistic because it ignores the issue of tax avoidance which you say you understand.

So please, square that circle for us.

You're incorrect.

I suspect that when you posted the poll you really did think that increasing marginal rates would create more tax revenue.  But it isnt so simplistically true.

Right. I also believe that the rest of the world is a Utopian socialist society.