Posted on 08/30/2015 6:54:01 AM PDT by conservativejoy
First Donald Trump antagonized the Republican establishment with his proposals on immigration. Then he irritated some with his stands on trade and Social Security. Now Trump is preparing a tax proposal that will again set him far apart from the party's powers-that-be.
The problem for the establishment is that Trump's positions on all three issues are more in line with the majority of American voters than the establishment's preferred policies. By using his popularity to force outside-the-GOP-box ideas into the Republican presidential debate, Trump is displaying an uncanny sense of the divisions between voters and the GOP power structure.
Trump has been sending signals that his tax proposal, which he says will be "comprehensive," will include higher rates for some of the richest Americans, a position generally at odds with Republican orthodoxy. "I want to see lower taxes," Trump said at an appearance in Norwood, Mass., on Friday night. "But on some people, they're not doing their fair share."
In particular, Trump has said he will go after "carried interest," which refers to the practice of hedge fund managers who make hundreds of millions of dollars a year paying a lower tax rate than Americans who earn ordinary wages. "I would take carried interest out, and I would let people making hundreds of millions of dollars a year pay some tax, because right now they are paying very little tax and I think it's outrageous," Trump told Bloomberg Politics last week. "I want to lower taxes for the middle class."
"Hedge fund guys have to pay up," Trump said Friday on MSNBC. "I'm going to lower taxes, but these hedge fund guys are making a lot of money — I have friends who laugh about how little they pay — and it's not fair to the middle class."
Trump appears to have a special concern about hedge fund executives — "They don't really build anything, they shuffle paper," he said on MSNBC. But his comments to Bloomberg suggest he might also target "people making hundreds of millions of dollars a year" in a more general way. Asked about a broad policy of increasing taxes on the super rich, Trump campaign manager Corey Lewandowski would say little about Trump's intentions, but noted that "Mr. Trump has said that he does not mind paying what is required to make our country great again."
Raising taxes on anyone, even the super rich, has generally been anathema to Republicans for a generation. But Trump will probably find a receptive ear among American voters overall. An academic study by Stanford professor David Broockman and Berkeley Ph.D candidate Douglas Ahler — a study that also had revealing findings about immigration — suggests that Trump's views on taxes are closer to the public's than those of Republican elites.
In the paper, Broockman and Ahler examined a broad range of public opinion on several issues. They conducted a poll in which respondents, rather than being given either-or policy options, were presented with a range of seven different possibilities on a particular issue, from the far left to the far right. On the question of federal taxes, these are the options Broockman and Ahler presented to respondents:
1. Establish a maximum annual income, with all income over $1,000,000 per year taxed at a rate of 100 percent. Decrease federal taxes on the poor and provide more services benefiting the middle class and poor.
2. Increase federal income taxes on those making over $250,000 per year to pre-1990s levels (over 5 percent above current rates). Use the savings to significantly lower taxes and provide more services to those making less and to invest in infrastructure projects.
3. Increase federal income taxes on those making over $250,000 per year to 1990s rates (5 percent above current rates). Use the savings to lower taxes and provide more services to those making less while also paying down the national debt.
4. Maintain current levels of federal spending and federal income taxes on the rich, middle class, and poor.
5. Decrease all individuals' income tax rates, especially high earners who pay the most in taxes now, accomplished by decreasing government services.
6. Move to a completely flat income tax system where all individuals pay the same percentage of their income in taxes, accomplished by decreasing government services.
7. Move to a flat consumption tax where all individuals pay the same percentage of their purchases in taxes, banning the income tax, even if this means the poor pay more in taxes than the rich. Significantly decrease government services in the process.
You ignore the fact that your knife has huge built in costs associated with the income tax system.
You also ignore the fact that you’re buying the knife with un-taxed income.
Pretty darned big oversight on your part.
He hasn’t really come out with his plan yet, so to call it class warfare is a bit premature. As far as the comments he’s made so far, regarding the rich paying their fair share, it sounded like he was talking about removing some of the exemptions given to hedge fund traders rather than increasing their tax rates. If his plan ends up being lower tax rates for all, but removal of many of the exemptions, I think I can live with that.
Gus top rate is 15% - it is being reported wrong to make you think he is raising taxes. The highest incomes pay 15%, the lowest 1%. It is still progressive, hence the titles.
It would be interesting to know the origin of this "carried interest" tax treatment the hedge fund managers benefit from. Special tax breaks like this often come about because they a slipped into larger bills barely noticed. Don't if this is one of those, but special little deals are often passed for favored industries or even for just one company.
Trump appears to be completely right about this one and people taking shots at him could end up looking pretty silly.
“Byron York who initially could not trash talk Donald enough seems to be moving from Depression to Aceeptance.” LOL!”
Bless his heart!:)
Donald’s plan would tax low incomes, just at 1%, which is more than they are paying now.
Byron York is smoking something. I dont’ buy for one second the majority of Americans agree with #1. That is pure communism and won’t/can’t work.
It is just a form of the graduated tax. I don’t know what the percentage of tax would be for over a million, but in his book, the maximum rate for anyone is 15%.
Under Clinton and Obama, a bottomless chasm developed.
Both of them have no use for we, the people.....they both worship at the Church of Whatever Works for Me.
Just by stepping onto the political stage, Donald Trump has drawn the people closer to their govt...as the Founders intended.
I don’t need to be pinged to Trump threads.
Thanks anyway.
They simply contracted with their investors to get paid for their efforts, in large part, in capital gains. So, they naturally paid taxes on the capital gains as capital gains.
It’s gonna be tricky to change that without putting a damper on investment capital altogether.
So Trump’s a “tax the rich” guy.
15% has actually been the lowest rate that hedge fund managers have had to pay on carried interest.
The definition is not crystal clear, but if these general partners are just managing funds from investors, and not putting up any funds of their own, then partners have not realized capital gains, but merely managed investments for others.
DEFINITION OF 'CARRIED INTEREST' A share of any profits that the general partners of private equity and hedge funds receive as compensation, despite not contributing any initial funds.
They super wealthy wonks are getting away with financial murder. It's no secret. That bull sh*t will be changing.
Most hedge fund managers do contribute some initial funds, but the “carried interest” they receive is not based on those funds.
Traditionally, fund managers were paid a 2% management fee. Then, the carried interest, typically at 20% of the profit on the entire fund, would be paid to the managers of the fund if they had delivered at least a pre-set rate of return. Thus, the carried interest was compensation for good performance.
A case could be made, as Trump apparently wants to make, that that capital gain went first to the investors, who in turn paid a performance fee based on the rate of capital gain. Thus, that performance fee should be taxed as ordinary income, rather than a capital gain.
I’m okay with him advocating that, though it is something of a red herring in that it doesn’t represent a major amount of taxes and only affects a relatively few people.
You want it to be voluntary like the E-Verify system? It's the same system the super wealthy wonks came up with! It's great for the corrupt politicians who's campaigns are bankrolled by tens of thousands of greedy corporations and employers. It allows them to game the tax payers out of taxes, wages, jobs, social services and everything else.
But it's all good and fair right?
Profits regardless of consequences. Nothing else matters!
It just sounds like tax scam some hedge fund big donors probably obtained from some bought and paid for members of Congress.
By definition, a capital gain is a gain on an asset purchased and owned for a specific period of time. Fund managers could have legitimate capital gains only on assets they actually owned.
If this is correct, Trump should make an issue of it. There's not a lot a sympathy around for big donors who everyone knows expect something in return for their big donations.
That’s actually not accurate. A capital gain could be realized, and tax owed, on gifted property.
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