We're doing the tax thing again....

Trunkage

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To be perfectly clear, the technical answer to that question is no. Stock increases are not income, because income is defined as money received, and you don't receive the money for your stock increasing in value until you sell it, so sales of stock are where most of Bezos income comes from.
No of course it wouldn’t be.
Did Pro Publica at all claim that the rise in stocks were income?
 

Agema

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You have to try to understand what is going on before you can make such a demand. Almost everything people think are loopholes are safety nets for regular people that you just wish didn't apply to rich people. I agree, the tax system needs work, and the wealthy should be paying more, but I don't think forcing people to sell off their assets to pay taxes on the assets they haven't sold is in any way reasonable. Imagine for a moment a middle class person starts a company, puts it in the stock market, is hugely successful, and suddenly their net worth has skyrocketed. If they have a modest salary but their stocks are now worth millions, the only way that person could possibly pay taxes on that wealth increase is by selling some stock. And who is going to be able to afford that newly expensive stock? Already rich people. Congratulations, you just accelerated the concentration of wealth. I'm sure that's what you intended, right?
Firstly, a guy with millions in stock is not so much a "regular person". Most Americans earn less than $40k a year, and will have entire lifetime earnings under $2 million.

Secondly, bear in mind the rich are also paying taxes on their stock rises in this model, so they will have to divest themselves of stock faster than the guy with a few millions of stock. Consequently, it is not clear to me how this concentrates wealth. We can of course also apply a threshhold and progressive tax brackets like we do with income tax, protecting low end millionaires but targetting higher end ones.

I would not actually complain if the government were paid in stocks and shares; several nations run sovereign wealth funds, where states hold profitable assets that both give the nation a "safety net" and generate revenue so reduce the tax burden.
 

stroopwafel

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You have to try to understand what is going on before you can make such a demand. Almost everything people think are loopholes are safety nets for regular people that you just wish didn't apply to rich people. I agree, the tax system needs work, and the wealthy should be paying more, but I don't think forcing people to sell off their assets to pay taxes on the assets they haven't sold is in any way reasonable. Imagine for a moment a middle class person starts a company, puts it in the stock market, is hugely successful, and suddenly their net worth has skyrocketed. If they have a modest salary but their stocks are now worth millions, the only way that person could possibly pay taxes on that wealth increase is by selling some stock. And who is going to be able to afford that newly expensive stock? Already rich people. Congratulations, you just accelerated the concentration of wealth. I'm sure that's what you intended, right?
The gist of the problem is that capital isn't(or barely) taxed so almost the entire tax burden falls on small business and income from work. Increasingly you have a situation where capital is tax free and exploding in value whereas work barely pays which contribute to the socio-economic divide that undermines stability and cohesion.

We are not talking about small to mid size business or investors here. How do you rationalize that someone sits on hundreds of billions worth of stock of which only a fraction is declared on their tax return because the rest is deducted through astronomical loans? How is it fair that huge corporations get to write off losses from future profit or report minimal domestic profit because it's written off in a country with the lowest capital gains? Meanwhile their shares in the company explode in value? How is it fair that the federal reserve suppress the interest rates and print unlimited money of which only the banks, financial institutions, multi billion dollar corporations and their benefactors profit? Who profit from the stock market inflation and who gets to pick up the tab when the bubble bursts? How do you explain this to the working stiff who has to depart with 30% of his income every month and lives from paycheck to paycheck?

The solution is quite simple. Have a minimum value of shares where debt becomes non-deductible. Only the super rich will be the ones who are affected by this as they are the only ones who have access to unlimited credit lines. How long do you think Bezos will last with his 80k salary?
 
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tstorm823

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No of course it wouldn’t be.
Did Pro Publica at all claim that the rise in stocks were income?
No. Your point?
Increasingly you have a situation where capital is tax free and exploding in value whereas work barely pays which contribute to the socio-economic divide that undermines stability and cohesion.
Something exploding in value doesn't mean anything if the value is sitting completely still. As the price of gold rises, you can say the value of the Earth itself is rising, but that's just a number until someone does something with it. Putting arbitrarily large numbers on unrealized assets doesn't actually hurt anyone. You pushing the perception of a divide is more damaging than Bezos owning Amazon.
The solution is quite simple. Have a minimum value of shares where debt becomes non-deductible. Only the super rich will be the ones who are affected by this as they are the only ones who have access to unlimited credit lines. How long do you think Bezos will last with his 80k salary?
I really don't know how to respond to you here. Jeff Bezos sells his stocks to fund himself. He's paid billions in taxes on that. Your "just live on infinite loans, the banks will never want the money back" theory is just ridiculous. I understand that some rich people in some years have taken out loans the counterbalance their income, but that is a short term situation., In years after, they are obligated to pay the loans back, and they have to do so with their money that they pay taxes on. That is a short term hiccup, not a long term tax avoidance strategy.
 

stroopwafel

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No. Your point?

Something exploding in value doesn't mean anything if the value is sitting completely still. As the price of gold rises, you can say the value of the Earth itself is rising, but that's just a number until someone does something with it. Putting arbitrarily large numbers on unrealized assets doesn't actually hurt anyone. You pushing the perception of a divide is more damaging than Bezos owning Amazon.

I really don't know how to respond to you here. Jeff Bezos sells his stocks to fund himself. He's paid billions in taxes on that. Your "just live on infinite loans, the banks will never want the money back" theory is just ridiculous. I understand that some rich people in some years have taken out loans the counterbalance their income, but that is a short term situation., In years after, they are obligated to pay the loans back, and they have to do so with their money that they pay taxes on. That is a short term hiccup, not a long term tax avoidance strategy.
If a billionaire don't realize his gains it doesn't exist according to you. What billions in stock did Bezos sell? He declared the minimum amount of share value increase on his tax return just like his salary is declared at a minimum. Do you honestly believe Bezos lives off 80k per year?

Money is expensive when interest rates are low so banks and financial institutions are more than happy to borrow against credit for Bezos' stock. What do you think is more lucrative; having a long term interest in the richest person on earth or have that money stashed in reserves at zero percent efficiency? The banks and financial intstitutions will never want that money back from someone like Bezos or Amazon b/c it's too expensive without a secure destination. Too much money searching for investments is the reason why the stock and property market is so inflated. Do you honestly believe that those who are providing Bezos with unlimited credit will soon lose faith in Amazon? The fastest growing company on earth? Because that is the 'short term hiccup' we're talking about here.

There is no 'perception' of a divide there is a divide. When the richest few don't even have to pay 1% of tax on their capital that is exploding in value with each passing year due to legislation in their favor while the working folk have to bend over backwards to not only pay their bills but have to carry the vast majority of the tax burden as well then how is that not a divide? Do Amazon sweatshop slaves get to pay just 1% of their hard earned income in tax? Or is that just exclusive to the astronomical wealth of the elite? Bezos will have earned another billion by the time it takes for one of his workers to piss in a bottle.
 

Seanchaidh

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Putting arbitrarily large numbers on unrealized assets doesn't actually hurt anyone.
The arbitrarily large numbers are based on a business model that involves people who are paid rather poorly peeing in bottles to keep up with their grueling work schedule.

You pushing the perception of a divide is more damaging than Bezos owning Amazon.
The guy bought a nationally distributed newspaper with a small fraction of his "earnings"; stop with this nonsense.
 

tstorm823

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If a billionaire don't realize his gains it doesn't exist according to you. What billions in stock did Bezos sell? He declared the minimum amount of share value increase on his tax return just like his salary is declared at a minimum. Do you honestly believe Bezos lives off 80k per year?

Money is expensive when interest rates are low so banks and financial institutions are more than happy to borrow against credit for Bezos' stock. What do you think is more lucrative; having a long term interest in the richest person on earth or have that money stashed in reserves at zero percent efficiency? The banks and financial intstitutions will never want that money back from someone like Bezos or Amazon b/c it's too expensive without a secure destination. Too much money searching for investments is the reason why the stock and property market is so inflated. Do you honestly believe that those who are providing Bezos with unlimited credit will soon lose faith in Amazon? The fastest growing company on earth? Because that is the 'short term hiccup' we're talking about here.

There is no 'perception' of a divide there is a divide. When the richest few don't even have to pay 1% of tax on their capital that is exploding in value with each passing year due to legislation in their favor while the working folk have to bend over backwards to not only pay their bills but have to carry the vast majority of the tax burden as well then how is that not a divide? Do Amazon sweatshop slaves get to pay just 1% of their hard earned income in tax? Or is that just exclusive to the astronomical wealth of the elite? Bezos will have earned another billion by the time it takes for one of his workers to piss in a bottle.
This is truly meaningless word salad. You really think that banks like to loan rich people money and don't care if/when those loans are paid back? Wat?
The arbitrarily large numbers are based on a business model that involves people who are paid rather poorly peeing in bottles to keep up with their grueling work schedule.
They aren't though. They are based on how much other people want to pay for them, and really nothing else.
 
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Seanchaidh

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They aren't though. They are based on how much other people want to pay for them, and really nothing else.
I'm sure the executives will be happy to hear that they don't have to exploit their workers so hard, then. They can just let worker well-being eat in various ways into revenues and costs, as really all value is just subjective anyway and the high price of AMZN is based on nothing other than the whims of investors. Oh! They could just close down shop entirely and shift to only marketing themselves as a good stock buy. That ought to work amazingly well!
 

stroopwafel

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This is truly meaningless word salad. You really think that banks like to loan rich people money and don't care if/when those loans are paid back? Wat?
Do you have low reading comprehension? What I wrote was very simple. Financial reserves are expensive and investments are lucrative. Hence unlimited credit to billionaires is mutually beneficial. You applying high-school economic theory how these loans need to be paid back at some unspecific time in the future completely misses the point. The point being the economy's addiction to cheap credit which will not change anytime soon.
 

tstorm823

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Hence unlimited credit to billionaires is mutually beneficial.
Because they pay it back. If they don't, giving all your money away is a lot more detrimental than the costs of holding onto it. How do they pay it back? Not with credit!
 

Silvanus

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You have to try to understand what is going on before you can make such a demand. Almost everything people think are loopholes are safety nets for regular people that you just wish didn't apply to rich people. I agree, the tax system needs work, and the wealthy should be paying more, but I don't think forcing people to sell off their assets to pay taxes on the assets they haven't sold is in any way reasonable. Imagine for a moment a middle class person starts a company, puts it in the stock market, is hugely successful, and suddenly their net worth has skyrocketed. If they have a modest salary but their stocks are now worth millions, the only way that person could possibly pay taxes on that wealth increase is by selling some stock. And who is going to be able to afford that newly expensive stock? Already rich people. Congratulations, you just accelerated the concentration of wealth. I'm sure that's what you intended, right?
Put a little thought into it. These are not difficult roadblocks to overcome.

If an adjustment might unfairly affect those for whom the rule is a genuine safety net, set the adjustment only at a certain level of wealth and above.

If somebody's in the bizarre position of having enormous wealth in stocks but not enough actual money to pay tax on it, because of a recent skyrocket in value, then perhaps implement a clause stating that if someone's wealth has drastically risen from below the wealth-tax threshold, then there is a 1-year delay before the wealth tax kicks in, so they are not caught in a quick, precipitous situation. But after that? Yes, they would need to sell some stocks.

Maybe it's a little unfair on that stock-owner guy. Honestly I don't much care. It's less unfair than starving the public services of revenue.
 

Trunkage

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That's not what this is about. When people are paid in stock, it is reported on the W-2 as income and treated sort of as though they were paid money and then immediately bought stock with it. You do not avoid income taxes on that, other than if the stock increases in value after you get it, and then you only pay capital gains on the difference when you sell. That's not how Bezos is so wealthy though. His number of stock has gone way down in fact. The increase in his wealth isn't being paid in stock, it actually has no connection at all to what Amazon pays him, it's from the stock he already owns increasing in value, and the only way he's avoiding tax on that increase is by not selling all his stock. That's it.
So... salary sacrificing isnt a thing in America. That's wierd. Because I thought it was
 

tstorm823

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What do you think they were trying to do?
Suggest that the rise in wealth should be taxed the way income is.
So... salary sacrificing isnt a thing in America. That's wierd. Because I thought it was
Not with that term, or in the same way you do there. There are a some similar things, like pension plans or health care things, but that's all pretty strictly defined.
 

Trunkage

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Suggest that the rise in wealth should be taxed the way income is.
Or doing a hypothetical. Identifying how the rules benefit the rich. Showing WHY assets are seen so productive. Demonstrating why getting a wage is stupid, economically speaking. Suggesting that worry about income tax level wont help tax the rich, so try other ones. Educating people on asset classes

Also, offending some people. Because that always happens nowadays.
Not with that term, or in the same way you do there. There are a some similar things, like pension plans or health care things, but that's all pretty strictly defined.
Negative gearing?
 

tstorm823

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Or doing a hypothetical. Identifying how the rules benefit the rich. Showing WHY assets are seen so productive. Demonstrating why getting a wage is stupid, economically speaking. Suggesting that worry about income tax level wont help tax the rich, so try other ones. Educating people on asset classes

Also, offending some people. Because that always happens nowadays.
Ah, yes. The piece that explicitly describes owning things that got more valuable as "tax avoidance" is clearly an honest, educational piece that only seeks to show flaws in the system. They certainly made no effort to demonize anyone.
 

stroopwafel

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Ah, yes. The piece that explicitly describes owning things that got more valuable as "tax avoidance" is clearly an honest, educational piece that only seeks to show flaws in the system. They certainly made no effort to demonize anyone.
You talk like you are part of the elite yourself but you're probably just an ordinary wage slave who has to pay taxes while working a 9 to 5 to make ends meet so how does it makes sense to you that billionaires get to sit on billions of stock yet barely pay any tax? Why should work be taxed much higher than capital that explodes in value without effort(that only the already rich profit from)? How does it makes sense to you that billion dollar corporations demand frozen wages while living costs skyrocket but gets to write off domestic profit in countries with the lowest capital gains? Who gets to defend exploitative labor practices to maximize 'productivity' but are the only ones who get to profit from monumental wealth increase? How does it makes sense to you that the only ones who profit from economic growth is the stock market and rich shareholders while the rest get to 'enjoy' environmental ruin?

Why someone who himself is most likely low on the totem pole defends these kinds of practices boggles the mind.
 

Avnger

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Why someone who himself is most likely low on the totem pole defends these kinds of practices boggles the mind.
Because any day now the "job creators" will realize he belongs at the top of the pyramid just like them and help him to his rightful place above the lazy, undeserving rest of us.
 
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tstorm823

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You talk like you are part of the elite yourself but you're probably just an ordinary wage slave who has to pay taxes while working a 9 to 5 to make ends meet so how does it makes sense to you that billionaires get to sit on billions of stock yet barely pay any tax? Why should work be taxed much higher than capital that explodes in value without effort(that only the already rich profit from)? How does it makes sense to you that billion dollar corporations demand frozen wages while living costs skyrocket but gets to write off domestic profit in countries with the lowest capital gains? Who gets to defend exploitative labor practices to maximize 'productivity' but are the only ones who get to profit from monumental wealth increase? How does it makes sense to you that the only ones who profit from economic growth is the stock market and rich shareholders while the rest get to 'enjoy' environmental ruin?

Why someone who himself is most likely low on the totem pole defends these kinds of practices boggles the mind.
It would take several pages of rambling to unpack all of the nonsense in here, so I'm just gonna pick a couple. I'm not defending any practices here. Stocks getting more valuable isn't a "practice". It's not a thing people are doing. It is a consequence way down stream. Sometimes it's a consequence of what the business is doing. Sometimes it's a consequence of thing completely outside of anyone's control. A literal tornado can upend a person's wealth at any moment. That's not practices, that's consequences. You're not upset at the practices of billionaires, you're upset at the circumstances of them.

Also, "write of domestic profit in countries with the lowest capital gains" is possibly the dumbest phrase I've ever seen in my life. What in the hell is that supposed to mean?
 

tstorm823

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Because any day now the "job creators" will realize he belongs at the top of the pyramid just like them and help him to his rightful place above the lazy, undeserving rest of us.
Very much the opposite. I do what I do, I get paid more than I need to meet my general wants and needs, and I refer to the situation as infinite money because I really don't know what I'd do with more than what I have, so the supply may as well be infinite. (I'd probably give a bunch to the Catholic Church, tbh.) I don't need more than my place, though I do tell people to vote for me when I run for president.