Posted on 09/23/2019 8:38:46 AM PDT by Enlightened1
Sen. Elizabeth Warren’s proposed wealth tax may create a new incentive for rich couples to divorce to avoid the tax, according to Harvard economist N. Gregory Mankiw.
Warren’s plan would impose a 2% annual tax on wealth over $50 million and a 3% tax on wealth over $1 billion.
If a wealthy couple is worth $100 million, they would pay a 2% tax on any wealth over $50 million, which in their case would amount to $1 million a year.
If they divorce and split their fortune in half, they would each be worth $50 million and neither would owe any wealth tax.
Sen. Elizabeth Warren’s proposed wealth tax may create a new incentive for rich couples to divorce to avoid the tax.
In a recent analysis of the Democratic presidential candidate’s signature tax, Harvard economist N. Gregory Mankiw said that because of the nature and structure of the tax, ultra-wealthy couples could split their fortunes in half through divorce and avoid paying any tax. He said that for certain couples, divorcing could save them $1 million a year.
“The Warren proposal entails a $1 million per year marriage penalty,” said Mankiw, who was the head of President George W. Bush’s Council of Economic Advisers.
The strategy is fairly simple. Warren’s plan would impose a 2% annual tax on wealth over $50 million and a 3% tax on wealth over $1 billion. If a wealthy couple is worth $100 million, they would pay a 2% tax on any wealth over $50 million, which in their case would amount to $1 million a year. But if they divorce and split their fortune in half, they would each be worth $50 million and neither would owe any wealth tax.
(Excerpt) Read more at cnbc.com ...
In order to tax wealth, the amount of wealth people have will have to be determined. This will require the establishment of a huge intrusive bureaucracy (or an enlargement of an existing one) to determine how much wealth everyone has. And they’ll have to look at everyone, won’t they. You hear stories of supposedly poor people passing away who, in fact, had fortunes.
Another example of the federal government intruding itself in citizens’ affairs. It’s not just the tax, it’s the power grab.
More than what you have in the bank...She was talking about the value of your house and all other assets. You could conceivably have a house at 50 million in value and nothing in the bank and still have to pay 2% of the 50 million value of your assets...where do you get the money from you ask? This is beyond wrong
We have that now. No fathers in the household.
the whole reason government took over marriage from religious institutes was to give financial incentives to families so they could have more children- more future tax payers to support the government
Now they are gonna penalize marriages?
Back when the top income tax rate was 92% the Dems wanted to raise it to 100% above $200,000. But even their left wing lawyers thought it would run afoul of the 5th Amendment against unlawful seizures.
Make that the 4th Amendment.
Sorry but even if you flat out confiscated all the assets of the top 1%......you wouldn’t even move the needle on the budget deficit and US debt. The simple math is this.....the bulk of the nation’s wealth rests in the large block of middle class people. Their combined assets dwarf the top 1%..or even 5%.
These lying politicians need to shown the door.....
Seizing one's income or accumulated wealth would be the equivalent of declaring high salaries and savings as a criminal activity.
-PJ
When you tax something, you get less of it, and married people are much less likely to be dependent on the government. People who are dependent on the government are much more likely to vote Democrat.
Yep. Accumulated wealth is property.
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