"Ah, here's my limo."
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 don’t 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. Warren’s 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 investor’s 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.
“It’s 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. Warren’s capital-gains plan would transform investing rules for the top 1%—about 1.5 million households.
(Excerpt) Read more at wsj.com ...
She wants 100% of the investment gain and then 58% more of the investment gain to be paid from accumulated wealth. A real incentive to invest, huh?
The super wealthy already have people on staff planning for this. I think you would have to get your money out before she took office since she could issue an executive order freezing bank transfers or something like that. There are probably a dozen different things that could be done to tie things up until they can complete the first order of business, which would be to pack the courts. Then they can do anything they want. Or, at least try. We still have that pesky 2nd amendment thing.
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.
Well at least people are seeing it in black and white now, thanks to Trump.
The democrats want 100% of everyone’s wealth. Always have always will.
The Expatriation Tax instituted around 2007-2008 will hit any wealthy individual leaving the US. This law acts as if the individual has died and the value of his estate is being taxed by the IRS - even though the individual is still alive - just moving out of the country.
Why do none of these articles point out that a wealth tax violates Article 1, section 9, item 4 of the US Constitution?
Imagine, heaven forbid, Warren were to be elected POTUS. Starting the day after the election until her inauguration there would be a massive sell off on Wall Street as the wealthy would be liquidating everything and preparing to leave the country.
The IRS can do whatever they want. If I bought an asset for $250,000 last week they’re going to have a hard time claiming it’s worth $10 million. They’ll end up on the losing end of a lot of cases in tax court.
100%+ marginal tax rates is not an unintended consequence but part of a plan to force rich people to dissipate their wealth. Of course, when that happens the limited revenues will come no where close to funding Warren’s welfare state.
Tax rates were high before Reagan, but there were lots of loopholes. This is outright thievery.
You think Warren’s plan won’t be chock-full of Loopholes?
“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.”
Guillotinse. We will need lots of guillotines. I think I need to start investing in them. However I can’t make too much money I will owe everything i earn plus part of the principle. So ridiculous.
That NEW MATH sure is wonderful, isn’t it???
Keep in mind that when any of these self made people die, the ESTATE tax also kicks in——on money that already was taxed.
A lot of money would be moved overseas.”””
ALOT of people would be moving overseas.
The side benefit would be the crushing of municipal tax receipts in getting appeals won to revalue the property at the most recent sale price to get the property re-assessed at the new lower value for property tax purposes.
Do enough of these and you get new lower comps, too!
I’d liquidate my assets including the house into cash and burn it all in a bonfire and post it on youtube.
Then deduct a huge casualty loss on the 1040.
If they want 120% to purposely impoverish me; they’ll get none of it.
That's exactly why this rogue unconstitutional agency should be shut down, their buildings sold, and their commie employees sent packing.
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She just is not thinking straight; possibly because she can’t. I don’t have her education, but she should know by now that excessive tax rates will inevitably result in less tax revenue. It doesn’t take a college education to know this. Her “programs” seem to all be based on a lot more tax revenue than is currently being received.
"Ah, here's my limo."
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