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Under this premise I believe we would see little change in the current way of things. One could claim that nearly all programs have a blanket positive effect therefor everyone should pay for them leading to what we have now.
I would cut corporate taxes to almost nothing, dramatically raise the inheritance tax and slightly raise the capital gains tax. Most importantly, the system needs to be dramatically simplified. The system of deductions and credits is so complex it brings the whole system down. I would also look into replacing brackets with a formula that averages the same tax rate.
Why in the world would you do that?
I am also for removing alot of the child labor restrictions. Not all but many. I do not think a child in the US should be forced to work but I believe they should be allowed to if they are willing.
Kal'Stag, you may think I come off as a cold hearted sob by removing alot of the government aid that our current system offers. I assure you I am not. I have done much for elderly people in my life but I chose to help them. If I had been forced I would have done everything possible not to. Thats just the way I am.
Many people think that if government systems were removed that we would suddenly have an epidemic on our hands. I disagree. Look at our country before we had such programs and you will find that Americans can be very generous. Like me people volunteer to help their neighbors in times of need. Families often cared for members when they were ill or down on their luck. The problem with government system is (I believe the majority) on the system choose the system and are forcing other to pay for them.
My own grandparents rarely ever worked. They were pefectly able people but they chose not to because the government fed them. If the government had not given them food they would not have starved to death but instead would have worked. I have never heard of a case of someone starving to death because the could work and eat or starve and chose to starve.
Increase philanthropy. When you know that your heirs won't get much and you don't have lots of time to spend, you go out and give it to charities. That's more or less Buffet's reason.
Increase philanthropy. When you know that your heirs won't get much and you don't have lots of time to spend, you go out and give it to charities. That's more or less Buffet's reason.
Taxes are inevitable (every institution (including government) has operating costs that need to be met). And you talk of voluntary taxes... free-rider problems severely limit their effectiveness. In other words, people want govt, but if you gave them the choice to pay taxes, they would try putting it off on others. Thats human nature.
So whats the use of saving to help support your kids after you die so that they can (hopefully) lead a better life than you?
I don't care what Buffet does.
The point of raising the inheritance tax is that it lets you have a lower tax burden on income. Its not really an argument that heirs shouldn't be allowed to inherit money, but that they should be taxed before those who are earning it in the workforce.
Depends what you mean by support. Leaving around enough so that your kids can be successfully through work is different than leaving enough so that your kids never have to work a day in their lives.
What business is it of yours, or anyone else's?
The point of raising the inheritance tax is that it lets you have a lower tax burden on income.
Its not really an argument that heirs shouldn't be allowed to inherit money, but that they should be taxed before those who are earning it in the workforce.
Its naiive to think that taking away government institutions would fix everything, just like its naiive to think that economic planning can work.
The thing is that government is not too different from any other institution in the private sector (firms, non-profits, corporations, etc.) ... it is a form of organization that converts the choices of individuals into collective action.
Government was formed to protect the fundamentals that our society is built on. From a free market perspective, a government sets certain rules by which a free market can then operate (significantly different from economic planning).
We know from history that child labor laws were needed to prevent exploitation and produce a healthy/competitive society. so that is a game rule that we cannot generally part with.
Public education? Public health care? maybe that can be discarded with, but I do believe that certain regulations are still necessary. In other words, the government needs to produce certain rules for firms to operate within. As long as these rules don't infringe upon basic market dynamics, the results should be fairly efficient.
Taxes are inevitable (every institution (including government) has operating costs that need to be met). And you talk of voluntary taxes... free-rider problems severely limit their effectiveness. In other words, people want govt, but if you gave them the choice to pay taxes, they would try putting it off on others. Thats human nature.
The only tax heirs should pay on their inheritance is nothing. The money's already been taxed, the government has no moral claim to it.
Depends what you mean by support. Leaving around enough so that your kids can be successfully through work is different than leaving enough so that your kids never have to work a day in their lives.
Perhaps not, but Buffet is indeed leaving something like $5 million for each of his kids. Enough for each to do what they want, but not exactly enough to do nothing for their entire lives.
The only tax heirs should pay on their inheritance is nothing. The money's already been taxed, the government has no moral claim to it.
If one wanted to falsely argue that it should be taxed, the inheritance should be counted as nothing more than income and taxed at whatever rate the heir pays at when he files his 1040.
There's nothing special about an inheritance that makes it deserving of special grabbing from the government. It's not the government's money.
Not really. Generally those who will see the estate tax are those making significant amounts of money
and thus those in the highest tax brackets.
Guess what those people do? They invest the money into state municipal bonds which are tax free. So thus, that money has not been taxed.
Basic allocation of high income workers dictates that they seek the lowest marginal tax for their investments.
While the marginal tax is actually quite high on municipal bonds in the form of opportunity cost, the effective tax is quite low by comparison. And someone with a decent estate planner will simply take the money earned from tax free municipal bonds and reinvest them as they mature. So imagine taking $10 million in munibonds with a return of 4%. Over the course of 20 years, with full reinvestment, the amount of money at the end is almost $22 million. None of that $12 million was taxed. Another 10 years and it's over $32 million.
By that reasoning, trusts shouldn't be taxed and therefore be allowed to accumulate all of the money in the world because it's not our business.
All money gets taxed multiple times. The company I works for pays corporate taxes, I pay income taxes on my salary, I pay tax on the stuff I buy, which then becomes corporate revenue ect. Taxation is a zero-sum game. Not taxing inheritance means you have to tax working people more.
Depending on how your tax brackets work, that isn't a terribly unreasonable level.
Is there something special about me getting paid that makes it the governments money? Taxes are a requirement to pay for our government, and they need to gathered one way or another. I fail to see why getting money from dead relatives is more special than getting it from a job.
Not if you stop spending their money on crappy unconstitutional government programs.
Because in reality it's not coming from dead relatives, it's coming from living heirs.
Except if you cut spending, you should be able to lower taxes if revenue needs are decreased. In fact, if you had the inheritance tax alongside of the income tax, you could cut them both. No matter how you slice it, not having an inheritance tax requires a higher income tax.
That makes no sense. Living heirs are getting money from their dead relatives, that is the very definition of inheritance. In any case, it doesn't change my point.
Fair tax system?
First, I'd obey the Constitutional limits on federal spending.
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