Skip to comments.Elizabeth Warren’s Tax Plan Would Bring Rates Over 100% for Some
Posted on 11/15/2019 5:30:43 AM PST by karpov
Democratic presidential candidate Elizabeth Warren has unveiled sweeping tax proposals that would push federal tax rates on some billionaires and multimillionaires above 100%.
That prospect raises questions for taxpayers and the broader economy that experts are starting to ponder: Under which circumstances would taxpayers have to pay those rates? How might that change their behavior? And would investment and economic growth suffer?
Potential tax rates over 100% could result from the combination of tax increases the Massachusetts senator proposes for the very top tier of investors. She wants to return the top income-tax rate to 39.6% from 37%, impose a new 14.8% tax for Social Security, add an annual tax of up to 6% on accumulated wealth and require rich investors to pay capital-gains taxes at the same rates as other income even if they dont sell their assets.
Consider a billionaire with a $1,000 investment who earns a 6% return, or $60, received as a capital gain, dividend or interest. If all of Ms. Warrens taxes are implemented, he could owe 58.2% of that, or $35 in federal tax. Plus, his entire investment would incur a 6% wealth tax, i.e., at least $60. The result: taxes as high as $95 on income of $60 for a combined tax rate of 158%.
The rate would vary according to the investors circumstances, any state taxes, the profitability of his investments and as-yet-unspecified policy details, but tax rates of over 100% on investment income would be typical, especially for billionaires.
Its just a continuing laundry list of proposals that just keep heaping on, said Robert Gordon of Twenty-First Securities Corp. ...
Beyond the estimated 75,000 households that would be hit by the wealth tax, Ms. Warrens capital-gains plan would transform investing rules for the top 1%about 1.5 million households.
(Excerpt) Read more at wsj.com ...
That’s insane...you can only have 100% of anything
I am of the opinion that the US ... if we continue to maintain an income tax ... must establish a minimum and maximum tax rate.
This Rat Bitch is totally out of her mind.....why invest...why work....why live???
Not in the mind of the typical dim thief politician. 100% is just the beginning to them.
Math is hard.
What a genius
That’s the point. She wants to make it look like she’s only taking 39% of “current” income, but she wants to steal from the safe that holds the accumulated income as well.
A 100% net tax relative to income is easy to see without a lot of numbers.
Suppose one is subject to the 6% wealth tax, but invests conservatively in 5% rate tax exempt municipal bonds.
On $1000, the income would be $50; the confiscation would be $60. Presto: 120% tax rate.
But, that mixes the penalty on principal, which is confiscatory, with the penalty on income, which is just “tax”.
The only upside would be how many Hollywood celebrities only do movies every other year and film them all between December and January to split up their incomes. Even after that, they'd probably lose 90% of their royalty checks if they worked on anything else.
(If I have the anecdote correct, Reagan turned down a role in a movie once because he'd only get to keep about 10 cents on the dollar for what they were willing to pay him. He might've been telling that story about another actor though. I don't remember the whole thing.)
Yes, we need an Alternative Maximum Tax no higher than 30%.
Won’t happen, but boy would it cause a stir if the response from one of the “rich” Warren blather about would be the same as the response as the Mel Gibson character in the movie “Ransom”.
Huh? I thought it was 2 cents?
A lot of money would be moved overseas.
Hey, Bill Gates! Its Warren Buffett. I have an office building I purchased a few years ago for $10 million. Howd you like to buy it for $250,000? And while I have you on the phone, lets discuss my interest in buying YOUR office building!
The Romans, in the 2nd and 3d century AD, when faced with confiscatory taxes solved the problem by getting a new emperor. The process was usually quick and efficient but hard on members of the outgoing regime.
If this comes to pass, there will be a tsunami of capital flowing out of the US. Some enterprising nations will declare amnesty for rich people and have to power to make Fauxcahantas think twice about flexing her muscle. Too bad Russia has lousy weather.
Sounds like sharia law to me!
Watch $2.5T disappear from the common investment markets overnight.
There is much of enduring value to own which cannot be easily assessed & taxed.
The rich are rich because they know how to acquire & retain wealth, regardless of assaults thereon.
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