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To: pas
All income should be treated with a flat rate. No special rates no special deductions.

Raising the tax on savings and capital gains will result in a big drop in tax revenue. Investors will simply leave their money where it is and, thus, fail to take the gain.

Not only does that reduce tax revenue, it makes the economy less efficient as money doesn't flow as quickly out of inefficient companies to newer, more efficient ones.

Your suggestion is great class warfare, but poor economics.

14 posted on 12/02/2012 9:03:43 AM PST by BfloGuy (Workers and consumers are, of course, identical.)
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To: BfloGuy
Not only does that reduce tax revenue, it makes the economy less efficient as money doesn't flow as quickly out of inefficient companies to newer, more efficient ones.

I agree with you about having low rates for long term capital gains, but we need to be honest. When I buy stock (e.g., 1000 shares of McDonalds), McDonalds doesn't receive or even see a cent of that money. When I sell stock (e.g., 1000 shares of McDonalds), the money I receive comes from the buyer, not from McDonalds.

The stock buyer and the stock seller are just trading paper (money and stock). After the IPO, none of these subsequent transactions produce any funds for the issuing company.

15 posted on 12/02/2012 9:11:46 AM PST by Tau Food (Never give a sword to a man who can't dance.)
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