npace
Autocross Champion
- Location
- Netherlands
Do you think Billionaires consume less than poor or middle class people? The VAT is based on consumption. You love social programs and talk about how successful European countries are with them. Do you know how those programs are paid for? It's with a VAT. Yes, if a billionaire and a poor person buy a gallon of milk, they both pay the same tax on that gallon. The difference is that the billionaire then goes and pays a VAT on a yacht, or jet fuel for his trip to the swiss alps, or whatever else billionaires buy, that the poor person isn't buying. That makes the billionaire pay a lot more. If you and Bernie want Scandinavian style socialism, should we not adopt a Scandinavian style tax code? Do you get it now, or do I have to go further on this point?Now, as far as federal taxes. A VAT tax, really? Maybe we should just go to a federal sales tax (ie "Flat Tax"), right? That way somebody making minimum wage can pay the same Federal Sales Tax on a gallon of milk that Jeff Bezos pays on a gallon of milk. The Flat Tax, the VAT Tax, the National Sales Tax, are just ways to move our progressive federal tax system to a regressive federal tax system that taxes the poor and middle class the same way it taxes the rich. It's a horrible idea. Anyone that's more of an economist and less of a Republican pundit understands this. The middle class spend much of their paychecks. The rich don't. You want to get the economy going, you put more money in the hands of the middle class. This does not mean you punish the rich, but if you keep tilting the tax code more and more to the rich, then there are less and less people with money to support the US economy.
Case in point... why is it that CEOs can get paid in stock options that are only taxed at the top equity rate, which is something like 15%, meanwhile, their earned income rate would be at the top tax bracket of 35-37%? Why does every other "normal" American have to pay on their total income, with most of us only taking the standard deduction, but these CEO making over $10M a year can pay the top rate on their $1M salary, but then only pay maybe a 15% rate on the remainder of their income, because it was paid in stock options? And don't tell me that the CEOs are worth it, because American CEO making many times more than Japanese or German CEOs, and even when they do bad, the company board just "reprices" the options lower so they make about just as much money as before. The CEO always get paid, regardless of how the company performs.
On the capital gains tax, the reason there's a difference in tax rates is the associated risk. If I work for a company and only get paid in stock options, then my salary fluctuates with the valuation of the company, and there's a very real risk that my compensation goes down significantly. If I get paid a set salary, my pay comes in as long as I don't get fired or laid off. Also, if you start taxing capital gains the same as income, it removes the incentive for investment. If I take what's left of my income after it's already been taxed and then invest it, and make money, I get taxed again. But If I lose money, does the government compensate me? Of course not. Your proposal would price the middle class, whom you keep making statements about, out of being able to invest and build upward earning portfolios. These are simple concepts, and it proves why the system is fu**ed up. Doubling down on a stupid system, which seems to be your answer, doesn't make a lot of sense.