Re: Reddittors vs Wall Street
Posted: Fri Feb 05, 2021 2:11 pm
You could only tax financial assets or houses above a certain value or size.
Fair enough, so people become bankrupt because they're unlucky.jimbob wrote: ↑Fri Feb 05, 2021 8:53 amI don't have up to date information, but did get into an email correspondence with Dr Deborah Thorne who was a coauthor on one paper that estimated that 75% of medical bankruptcies in the US were for people who had had insurance at the start of their illness.Woodchopper wrote: ↑Thu Feb 04, 2021 12:36 pmYes, big difference there as people who aren't insured and are unlucky can very quickly end up with tens or hundreds of thousands of dollars in medical debt.
That said personal bankruptcy is even easier in the US. So its not like people are saddled with the debt for a lifetime. Though their credit rating gets f.cked.
They do contemplate a fairly low threshold (more for the purposes of discussing how it would work rather than as a recommendation), and in particular - I think.in the q and a - make some reference to a fairly-but-not-too-low threshold biting more in the south east of England than anywhere else. As I mentioned above, they suggested strategies e.g. payment over a period of time to cover the tax. I can't actually remember what they said about things like payment upon death and sale of the estate, I might be wrong but I think they were a touch vague on this point and perhaps suggested it could be considered but fairly strictly limited to avoid people tax dodging. Same with full deferral of payment for a specific period in general I think.dyqik wrote: ↑Fri Feb 05, 2021 1:41 pmYou could impose an n% tax on the net assets of the entire population, but that would get really messy around mortgages and people having to give up houses to pay the tax. Not to mention that it could crash house prices, leaving vast swathes of the population in net debt and so not paying the tax anyway, and you having to spend money to sort out who owes taxes now.
Which is why a threshold is sensible.
The other net asset that has to be considered are retirement investments, btw, which are probably the biggest non-property assets for big lump of the population.
Would need wider context, but it could also be because medical insurance is stingy.Woodchopper wrote: ↑Fri Feb 05, 2021 2:25 pmFair enough, so people become bankrupt because they're unlucky.
See also the US DoJ report into use of fines in FergussonWoodchopper wrote: ↑Fri Feb 05, 2021 2:25 pmFair enough, so people become bankrupt because they're unlucky.jimbob wrote: ↑Fri Feb 05, 2021 8:53 amI don't have up to date information, but did get into an email correspondence with Dr Deborah Thorne who was a coauthor on one paper that estimated that 75% of medical bankruptcies in the US were for people who had had insurance at the start of their illness.Woodchopper wrote: ↑Thu Feb 04, 2021 12:36 pm
Yes, big difference there as people who aren't insured and are unlucky can very quickly end up with tens or hundreds of thousands of dollars in medical debt.
That said personal bankruptcy is even easier in the US. So its not like people are saddled with the debt for a lifetime. Though their credit rating gets f.cked.
That doesn't solve the conundrum, it just limits the pain to people most of us don't know and don't sympathise with because they have nicer houses than us.Herainestold wrote: ↑Fri Feb 05, 2021 2:11 pmYou could only tax financial assets or houses above a certain value or size.
From that FAQ:discovolante wrote: ↑Fri Feb 05, 2021 2:47 pmThey do contemplate a fairly low threshold (more for the purposes of discussing how it would work rather than as a recommendation), and in particular - I think.in the q and a - make some reference to a fairly-but-not-too-low threshold biting more in the south east of England than anywhere else. As I mentioned above, they suggested strategies e.g. payment over a period of time to cover the tax. I can't actually remember what they said about things like payment upon death and sale of the estate, I might be wrong but I think they were a touch vague on this point and perhaps suggested it could be considered but fairly strictly limited to avoid people tax dodging. Same with full deferral of payment for a specific period in general I think.dyqik wrote: ↑Fri Feb 05, 2021 1:41 pmYou could impose an n% tax on the net assets of the entire population, but that would get really messy around mortgages and people having to give up houses to pay the tax. Not to mention that it could crash house prices, leaving vast swathes of the population in net debt and so not paying the tax anyway, and you having to spend money to sort out who owes taxes now.
Which is why a threshold is sensible.
The other net asset that has to be considered are retirement investments, btw, which are probably the biggest non-property assets for big lump of the population.
The actual website of the commission is here: https://www.ukwealth.tax/ which I confess to not having looked at. It has an FAQ though.
Their illustrative examples appear on p8 (250k to 10m). Figures I've seen proposed elsewhere seem to be for a kind of 'super wealth tax', with discussion of higher thresholds and higher tax rates e.g.It would only apply to the wealth that an individual owns above the threshold.
‘Wealth’ would be defined to cover all assets (including homes and pensions) but minus any debts such as mortgages.
Our report does not make any recommendations on thresholds or rates because these issues must be decided by politicians. Our own preferences on these issues carry no special weight, and since we don’t agree amongst ourselves it would not be possible for us to offer a collective view on this anyway!
...Piketty’s proposed 90 per cent tax on wealth over $1 billion. Even Sanders, who favours a wealth tax on the US’s top 0.1 per cent (meaning every married couple with $32 million and up) only suggests a top rate of eight per cent on wealth over $10 billion.
Might not have been their way of life so much as their sibling's?Martin Y wrote: ↑Fri Feb 05, 2021 3:20 pmThat doesn't solve the conundrum, it just limits the pain to people most of us don't know and don't sympathise with because they have nicer houses than us.Herainestold wrote: ↑Fri Feb 05, 2021 2:11 pmYou could only tax financial assets or houses above a certain value or size.
Reminiscent of what happened to "the stately homes of England" with astronomical death duties which meant you basically had little chance of inheriting the big house unless you still had lots of other stuff to sell. I don't know the politics behind how that came about but it struck me as odd that the people I think of as the ruling classes allowed the death of their own way of life through parliament.
[Harcourt actually inherited the estate when his brother died so if it was meant to be a second son's revenge he f.cked it.]the one significant legacy of the government was the introduction of a high uniform rate of death duties in Harcourt's 1894 budget. Harcourt himself was a second son, and thus unlikely to ever have to pay such duties himself, so it was often quipped that this introduction was a "second son's revenge".
That's the point of a wealth tax. To tax accrued wealth of the wealthy and use it to provide for the country as a whole. Of course, even after the tax, the rich people paying it will still have more than the people not paying it. So, yes, I do want the "pain" of still being richer than poor people to fall on them.Martin Y wrote: ↑Fri Feb 05, 2021 3:20 pmThat doesn't solve the conundrum, it just limits the pain to people most of us don't know and don't sympathise with because they have nicer houses than us.Herainestold wrote: ↑Fri Feb 05, 2021 2:11 pmYou could only tax financial assets or houses above a certain value or size.
Thanks. Yes, I didn't expect everyone to listen to a 90 minute long podcast, but it was a bit naive of me to assume people wouldn't speculate about its content without doing so.jdc wrote: ↑Fri Feb 05, 2021 5:24 pmFrom that FAQ:discovolante wrote: ↑Fri Feb 05, 2021 2:47 pmThey do contemplate a fairly low threshold (more for the purposes of discussing how it would work rather than as a recommendation), and in particular - I think.in the q and a - make some reference to a fairly-but-not-too-low threshold biting more in the south east of England than anywhere else. As I mentioned above, they suggested strategies e.g. payment over a period of time to cover the tax. I can't actually remember what they said about things like payment upon death and sale of the estate, I might be wrong but I think they were a touch vague on this point and perhaps suggested it could be considered but fairly strictly limited to avoid people tax dodging. Same with full deferral of payment for a specific period in general I think.dyqik wrote: ↑Fri Feb 05, 2021 1:41 pm
You could impose an n% tax on the net assets of the entire population, but that would get really messy around mortgages and people having to give up houses to pay the tax. Not to mention that it could crash house prices, leaving vast swathes of the population in net debt and so not paying the tax anyway, and you having to spend money to sort out who owes taxes now.
Which is why a threshold is sensible.
The other net asset that has to be considered are retirement investments, btw, which are probably the biggest non-property assets for big lump of the population.
The actual website of the commission is here: https://www.ukwealth.tax/ which I confess to not having looked at. It has an FAQ though.Their illustrative examples appear on p8 (250k to 10m). Figures I've seen proposed elsewhere seem to be for a kind of 'super wealth tax', with discussion of higher thresholds and higher tax rates e.g.It would only apply to the wealth that an individual owns above the threshold.
‘Wealth’ would be defined to cover all assets (including homes and pensions) but minus any debts such as mortgages.
Our report does not make any recommendations on thresholds or rates because these issues must be decided by politicians. Our own preferences on these issues carry no special weight, and since we don’t agree amongst ourselves it would not be possible for us to offer a collective view on this anyway!
...Piketty’s proposed 90 per cent tax on wealth over $1 billion. Even Sanders, who favours a wealth tax on the US’s top 0.1 per cent (meaning every married couple with $32 million and up) only suggests a top rate of eight per cent on wealth over $10 billion.
If you taxed Jeff Bezos' $200 billion at 90 %, he'd still have $20 billion, which is more than the GDP of many poor countries.dyqik wrote: ↑Fri Feb 05, 2021 5:44 pmThat's the point of a wealth tax. To tax accrued wealth of the wealthy and use it to provide for the country as a whole. Of course, even after the tax, the rich people paying it will still have more than the people not paying it. So, yes, I do want the "pain" of still being richer than poor people to fall on them.Martin Y wrote: ↑Fri Feb 05, 2021 3:20 pmThat doesn't solve the conundrum, it just limits the pain to people most of us don't know and don't sympathise with because they have nicer houses than us.Herainestold wrote: ↑Fri Feb 05, 2021 2:11 pmYou could only tax financial assets or houses above a certain value or size.
If you object to rich people paying more than poor people, then you're against most taxes except poll tax type things
Bit surprised you're proposing an annual wealth tax. Even Bernie only proposed a one-off 60% tax on wealth gains made by billionaires between March 18, 2020, and Jan. 1, 2021. (We've seen $731 billion in wealth accumulated by 467 billionaires since March 18, apparently.)
You do Jeff Bezos, you do Elon Musk, Bill Gates, the Kochs, Bloomberg, et. al.
No one has proposed a wealth tax that would make that a problem that needs to be solved.Martin Y wrote: ↑Fri Feb 05, 2021 7:00 pmI don't have any problem with progressive taxation, I just think that a one-off wealth tax, wherever you set its threshold, is going to raise fairness conundrums like how to compare an old couple who bought a house that eventually quadrupled in value with another couple whose house only doubled in value and yet another couple who spent their money on foreign holidays instead.
And even if it kicked in at £100k, it's overwhelmingly likely that primary residences would be exempted or otherwise treated differently - as is done with capital gains taxes and inheritance taxes.Bird on a Fire wrote: ↑Fri Feb 05, 2021 9:16 pmAn old couple with a £100 million pound house and not enough savings to pay the tax would have to move out if it into, say, a £10 million house.
Excuse me while I look for my teeny-tiny violin.
Yes, it's not a particularly difficult problem to solve and of course the people who've already been thinking about it have also already solved it.dyqik wrote: ↑Fri Feb 05, 2021 9:21 pmAnd even if it kicked in at £100k, it's overwhelmingly likely that primary residences would be exempted or otherwise treated differently - as is done with capital gains taxes and inheritance taxes.Bird on a Fire wrote: ↑Fri Feb 05, 2021 9:16 pmAn old couple with a £100 million pound house and not enough savings to pay the tax would have to move out if it into, say, a £10 million house.
Excuse me while I look for my teeny-tiny violin.
Couple A got very lucky with the housing market, couple B got lucky. Why should people get to keep all the money they've made through luck? We take a big slice of the money people have earned through hard work so why not take a tiny sliver of the money people have made by simply sitting in a house watching its value increase?Martin Y wrote: ↑Fri Feb 05, 2021 7:00 pmI don't have any problem with progressive taxation, I just think that a one-off wealth tax, wherever you set its threshold, is going to raise fairness conundrums like how to compare an old couple who bought a house that eventually quadrupled in value with another couple whose house only doubled in value and yet another couple who spent their money on foreign holidays instead.
It's a bit soon to make that judgement, but it certainly has been proposed to to something similar again and one proposal was in the Labour manifesto in 2019 so it seems highly likely that it will get repeated eventually.plodder wrote: ↑Fri Feb 05, 2021 7:47 amA bad example is Gordon Brown’s windfall tax on private utilities, which happened once.Millennie Al wrote: ↑Fri Feb 05, 2021 4:17 amThe speakers sound like they're a bit lacking in knowledge of human nature. There's no such thing as a successful one-off tax as if it is successful it gets repeated. A good example of this is income tax which was introduced as an exceptional measure to finance war and quickly got the government addicted so that despite attempts to get rid of it, it kept returning and we're now stuck with it.discovolante wrote: ↑Thu Feb 04, 2021 4:27 pmSpecifically, the speakers recommend a one off wealth tax
Where do you think the wealth of these people currently is? Do they each have a huge pit at home filled with gold coins that they sleep on?Herainestold wrote: ↑Fri Feb 05, 2021 7:49 pmYou do Jeff Bezos, you do Elon Musk, Bill Gates, the Kochs, Bloomberg, et. al.
Eventually there will be a disincentive to hoarding huge wealth, and money will stay in the economy of ordinary people who toil for a living.