BearsWiin said:
This guy disagrees
https://www.cnn.com/2019/11/13/perspectives/elizabeth-warren-medicare-for-all-taxes-middle-class/index.html
Let me address one issue in your article. On the wealth tax the article says
Quote:
Criticism that Warren is overestimating the revenue she can hope to generate from the wealth tax is overblown. She addresses these concerns by saying she will empower and appropriately fund the Internal Revenue Service to go after those who willfully avoid paying their taxes. Enforcing our tax laws and best practices on tax compliance can generate significant revenue. Closing America's tax gap the difference between taxes owed and taxes paid would help Warren get the revenue she needs
This has no grounding in reality. She has experts talking about wealth tax theoretically. There is ample evidence of how wealth taxes have worked in practice.
9 European countries enacted wealth taxes decades ago and have since eliminated them simply because they did not work. They had very high administrative costs and poor return. You are creating a whole new tax which creates a whole new requirement of producing valuations. You have a yacht, has to be valued. Jewelry. Has to be valued. Car. Has to be valued. How much do you think it is going to cost the IRS in time and expense to track all that down while expensive accountants and lawyers are minimizing it at every turn? I can tell you that the government index says my house is worth about 60% what I can get for it on the market.
There are 3 European countries with national wealth taxes. Two of them bring in little revenue even though the tax reaches down under $200K of wealth. Belgium just started a wealth tax on securities 2 years ago so the jury is still out. However, it is safe to say that Europe's experience is that wealth taxes have failed to bring in much revenue. Why do you think we will succeed?
Quote:
"They can be really difficult to administer and ensure even a moderate compliance rate," Daniel Bunn, the director of Global Projects at the nonpartisan Tax Foundation, told Business Insider of the European wealth tax experience.
He added that it became difficult for governments to justify the high administrative cost of enforcement as the rich were able to move assets and capital out of the country into lower-taxed jurisdictions, often within Europe.
Instead, Bunn said, European countries did away with it and doubled down on enforcing income taxes among others.
That bolded part is even more important for the US. There is an amendment to the Constitution that explicitly allows for an INCOME tax that is not apportioned directly to the states. Otherwise it was held to be unconstitutional. A wealth tax was not included in the amendment. It will face very serious court challenges if passed. Increasing capital gains taxes and adding a higher income tax bracket for the wealthy and eliminating the ability to reset the clock on capital gains on death are all already constitutional
If passed a wealth tax would require a completely new process to administer. Income taxes are already calculated. You are just changing the rates. Payroll taxes already have a system. You are just adding to it. No new administrative burden.
As a new tax, there is ample opportunity for accountants and lawyers to find tax avoidance techniques that they are not doing now because there is no tax. In Europe people just moved assets to countries that didn't have a wealth tax. There would be less of this with income tax because they are already taxes that the wealthy pretty much employ every technique they can to avoid. There isn't much they can do that they aren't already doing.
A wealth tax will also never pass. It is basically philosophically a taking of property by the government and philosophically that is a bedrock principle no-no in our nation's history. Tax income if you must, but the federal government does not take property.
Then lastly, she is using the (ridiculously inflated) revenue multiple times over to pay for her plans. It is like if little Timmy says "Mom. I want a candy bar." Mom says "That costs a dollar. Where will you get that?" "The next door neighbor says he'll give me a dollar to mow the lawn" "Okay!". "Mom. I want a soda." Mom says "That costs a dollar. Where will you get that?" "The next door neighbor says he'll give me a dollar to mow the lawn" "Okay!" "Mom. I want a toy." Mom says "That costs a dollar. Where will you get that?" "The next door neighbor says he'll give me a dollar to mow the lawn" "Okay!" Over and over.
My issue is not that she has a different way of raising revenue than I would. It is that she is proposing something that might sound okay but is practically speaking so monumentally stupid there is no way I believe that she believes it. That makes her a liar.