🇳🇱
Man its really annoying to see people constantly make up this whole "rich people dont pay taxes" nonsense.. If you review their actual tax records you'll see Elon paid about 1/3 of his income as taxes and Bezos about 1/4, which is actually quite high. But yea lets just make shit up instead and manipulate the numbers to show some "true" tax rate that is really just some fantasy as close to 0 as we can distort, cant just make up fake numbers and think its useful to addressing any problems that might exist.
@freemo but the issue isn't the taxes paid vs the reported income. The issue is that the reported income is so much less then the wealth growth.
Yes Bezos paid about 1/4 of his reported income in taxes, which I guess would be his "actual tax records", but his reported (taxable) income is only about 4% of what he actually made.
That is the issue at hand. That these mechanisms are in place that allow for the taxable income tobe a small fraction of their actual income.
@ejg Can you be more specific. What source of income does he have that is 25x greater than the one he reported and doesnt show as income?
@freemo @ejg I agree with what @freemo points out. People get outraged about how rich somebody is. And that is true. Except huge part of that wealth is only on paper in the fluctuating value of financial (and other assets). But nobody pays taxes over their net worth increases, we pay taxes from realised income.
Anyhow, these concepts have issues. For instance where I live, it can happen that you own say 50 shares of a startup (let it be 50%) which is worth 1000 bucks starting capital, then the next day investor comes along, buys another half for 1Mio bucks and the third day you have the tax office on your neck to pay taxes from a wealth increase (income) of 999k bucks, while all along your cash position did not change at all.
What I am trying to point out is this: Whenever people complain about rich people not paying tax on their wealth increases, the real question to them should be:
1. So how exactly will you legislate it so as not to harm everybody along the way?
2. And suppose if we all pay taxes even over wealth increases which are only on paper (because the stock you own or control went up due to market fluctuations, or geopolitics), what will we do when next year a person's net worth actually decreases? Will the tax office reimburse us, or what?
These are just headlines to cause outrage, nothing else. What actually helps is to tighten up the laws about income taxation and also classification what constitutes income and what does not. If e.g., Bezos has a salary of 1000 bucks and that's all he lives off, he shall pay taxes as a 1k income guy. But if he besides that lives in a house owned by Amazon Inc, drives a car owned by Amazon Inc. and flies Amazon-owned aircraft in his private capacity, then those effects should be counted as his income too. There are countries where this is sorted (at least on smaller scale) better.
@FailForward @freemo I think this is better explanation of the issue at hand and what I'm trying to express. And some of the articles on the subject do try to go into this, just in a very click-baity way.
I'm also using net worth/wealth growth/income too interchangeably. Perhaps it should be looked at more like:
- Who/what owns any given asset.
- Who benefits from that asset
- How is that asset taxed
- Who/What pays that tax
The very mentality that asset ownership need be taxed is diseasterous to say the least. It relies on the zero sum fallacy of economics for one.
@freemo @FailForward I pay property taxes on my house and car. It's a PITA, but far from "disastrous". I suppose if I had the legal resources, I could create an off shore shell company, and transfer ownership of my house/car to them. Then I wouldn't have to pay those taxes.
I would disagree.. I think the fact that you can never truly "own" your home, that even if you buy it you have to pay for it perpetually is very much disastrous.
A person should have the right to work hard, buy themselves a home, and then be free of that financial obligation, thats the point.
Taxing on assets, like a home, is just a way of saying you can never truly own anything, a government ill forever tax your assets and eventually should you ever fall on hard times financially loose everything you own and get nothing for it as it will all go to just cover the taxes you were unable to pay (and should have never hard to).
Yes taxing ownership of property is particularly heinous IMO.
@freemo @ejg I think the attitude to these issues really depends on cultural context. In the US obviously people think from their own perspective and if that society decides it's OK, it's OK for them. In EU and neighbouring countries the cultural view takes into account also the relationships of that wealth to everything else. You are having a house as a sovereign. The position is that the truly fundamental assets like land, air, water is owned by "the society" regardless of who currently has the right of use. Since your using the asset (house, land, what you have) has effect on the environment which belongs to all, the societies took the view that it's also fair to cover your share on costs your use of the asset create (access roads, pollution mitigation, water management, etc.). The view is that the more you own, the more you shall contribute to the society's wellfare.
From US perspective it might sound crazy, but in most EU countries people do not object that much and agree to pay their fair share. Different societies make different decisions, I personally do not see that there is any objectively "right" way to do this. Of course that view comes to its head when highly liquid financial assets are moved cross-border, etc. Hence the new corporate taxation ideas discussed at G7, etc. I personally this we indeed need to resolve this better than it is now. It will take time, but we'll get there.
