You can talk about income tax all you want to. The truth is that the wealthiest peoples income usually come from capital gains taxed at about 15%. So actually, the wealthiest pay less taxes on their income then a salaried or hourly worker.
I owned two companies. A good accountant helped me pay less income taxes to the IRS then my employees did. Generous tax write offs allowed me to show no profit if that was what I wanted. I could gross a million dollars and determine whether I wanted to post a gain or loss for the year depending on which write offs I could use.. There were write off benefits if you could show a loss. I am not “very” wealthy. But I know many who are. If they are smart they pay only enough taxes to keep the eyeball of the IRS from turning their way. Such people really don’t know what a paycheck is.
LOL. You are starting to show your true colors. Do you realize that more than 50% of Americans own stocks either directly or thru their pension funds and mutual funds. They receive capital gains as well. Do you want to increase the capital gains rates or tax them as regular income? Do you think that will increase tax revenue and investment? You seem to believe in this class envy/warfare spewed by the Left.
I owned two companies. A good accountant helped me pay less income taxes to the IRS then my employees did. Generous tax write offs allowed me to show no profit if that was what I wanted. I could gross a million dollars and determine whether I wanted to post a gain or loss for the year depending on which write offs I could use.. There were write off benefits if you could show a loss.
I have a hard time figuring out what your point is. If you own the companies, it is your capital that is at risk. You are providing the jobs. The tax system is a policy mechanism to encourage entrepreneurs to create businesses and jobs. Without your investment and willing to take risk, the government would not receive tax revenue from either you or your business but also from your employees. There is nothing wrong with that.
I have also owned a business as well as rental properties. I have no problem taking off things like business expenses and depreciation. You may view them as generous. I don't. If you want to go to a fair tax or a flat tax system, fine, but it must be understood that a tax system is not an end unto itself. A "fair" system may hurt economic activities that benefit the society. For example, if you eliminate charitable contributions as a tax deduction, would that impact the amount of charitable giving?
Your response reminded me of Obama when he was asked by Maria Bartiromo, I believe, why he wanted to raise the capital gains tax when it has been shown that the lower the rate, the more revenue the government received. Candidate Obama's response was it wasn't about the revenue but about fairness. The underlying assumption is that the government decides how much you can keep of the fruits of your labor and the government knows best how to spend it.
Here is part of the transcript of the March 2008 interview with Obama. It shows how illiterate he is when it comes to business and what his Marxist objectives are. It portends what Candidate Obama will do when he becomes President. Nothing he is trying to do now should come as any surprise.
BARTIROMO: How do you plan to change the tax code when it comes to capital gains? How high will that 15 percent rate go?
Sen. OBAMA: Well, you know, I haven't given a firm number. Here's my belief, that we can't go back to some of the, you know, confiscatory rates that existed in the past that distorted sound economics. And I certainly would not go above what existed under Bill Clinton, which was the 28 percent. I would--and my guess would be it would be significantly lower than that. I think that we can have a capital gains rate that is higher than 15 percent. If it--and if it, you know--when I talk to people like Warren Buffet or others and I ask them, you know, what's--how much of a difference is it going to be if it's 20 or 25 percent, they say, look, if it's within that range then it's not going to distort, I think, economic decision making.
On the other hand, what it will also do is first of all help out the federal treasury, which is running a credit card up with the bank of China and other countries. What it will also do, I think, is allow us to make investments in basic scientific research, in infrastructure, in broadband lines, in green energy and will allow us to give us--give some relief to middle class and working class families who have been driving this economy as consumers but have been doing it through credit cards and home equity loans. They're not going to be able to do that. And if we want the economy to continue to go strong, then we've got to make sure that they're getting a little relief as well.
BARTIROMO: But it's not just the Warren Buffets of the world who own stocks, so...
Sen. OBAMA: Of course not.
BARTIROMO: ...let's hypothetically say that...
Sen. OBAMA: Right.
BARTIROMO: ...cap gains tax goes from 15 percent to 25 percent.
Sen. OBAMA: Right.
BARTIROMO: You're impacting a lot of people.
Sen. OBAMA: Right.
BARTIROMO: A hundred million Americans own stocks today.
Sen. OBAMA: Absolutely.
BARTIROMO: So it's not just the rich.
Sen. OBAMA: No, no, no, absolutely. And that's why I think that it may be, for example, that you could structure something in which people with certain incomes were exempted from this increase and it would stay at 15. The broader principle that I'm interested in is just making sure that we've got a tax code that is fair for all Americans. And I think it is not unreasonable to say--you know, I know that we'll get some arguments from some folks on this, but it's not unreasonable to say that those of us in the upper brackets have benefited disproportionately from a globalized economy; that those benefits have been compounded by the Bush tax cuts and that for us to roll back some of those tax cuts and to put this economy on a more stable fiscal footing and to make investments in the American people so that they can afford a decent life, that that is actually good long term for our economy and also good for investors and Wall Street.