Counting Cats in Zanzibar Rotating Header Image

A straightforward suggestion.

There is endless complaint (and has been for years – from the msm and so on) about some rich people in the United States “only” paying 15% of their income to the Federal government (because they pay capital gains tax), whereas other people can pay as much as 35% (as they pay income tax).

It is much more complicated than the above – because, for example, there are many tax allowances with the various rates of income tax that capital gains tax does not have (so NO Warren Buffet – your secretary does NOT pay a lower rate of tax than you do).

But, O.K. – say the income tax should not be higher than the capital gains tax, say that is “unfair”.

Why does that mean the capital gains tax should be INCREASED – why should the income tax not be CUT?

Sorry Ron Paul but a “zero” rate of Federal income tax for everyone is not possible without a Revolution (and not the peaceful one you have in mind), but a 15% top rate of income tax (with State income taxes on top – no more deducting your State income tax from the income you present to the Federal tax collectors, rich leftists please note – and I do not see why local, State and Federal govenment bonds should be tax free either, why should lending money to the government get special tax treatment?) is perfectly possible.

After all the Federal government would stil have the Social Security tax (sorry “contributions” – although FDRs lawyers said it was a tax when it was challenged before the Supreme Court) and Corporation Tax and …….

So a flat rate 15% income and capital gains tax would be perfectly “fair” and would not require a Revolutionary transformation in the size of the Federal government (just a bit of serious cutting).

“You are only saying the above because it is the centre piece of the Gingrich campaign”.

Not at all – I have supported a “flat” Federal income tax for 30 years.

And the candidate it would most help is MITT ROMNEY – as he would not have to worry about his tax returns anymore. He could just say “yes I pay 15% – SO DO YOU”.

4 Comments

  1. Bod says:

    Good heavens, Paul, not you too!

    Immediate disclaimer – can’t vote over here, wouldn’t be voting for Romney anyhow …

    The accusations that Romney’s ‘hiding’ his tax returns and is hoarding his doubloons offshore – again?

    Look, the reason people are having this discussion is due to a conflation of two known facts and a bunch of financial trutherism. Romney *may* have undisclosed assets in offshore accounts, but the reason the conversation has arisen is twofold. The first of these is that some of Bain’s partnerships, like EVERY OTHER ALTERNATIVE INVESTMENT FUND that wants to attract non-US investors, have incorporated part of or all of their fund offshore. There are a number of reasons why this is beneficial, but the primary one is to defer some tax liabilities that would constrain their ability to employ full use of their capital. This is both entirely legal, and appropriate.

    The investors in these funds, incorporated offshore, are, by definition, enjoying returns made in investing at least in part, ‘outside’ of US Tax law. While the IRS hasn’t figured out yet how they can tax the Sultan of Brunei (and fuck! wouldn’t they just love to – and I’m sure they’re working on it), the fact is that the fund is operating offshore means it’s none of their business. Now, any US taxpayers who are investors in that fund (it’s completely legal to do so) do get taxed, and there’s a tax schedule for UBTI and non-UBTI gains etc,. Often, it’s financially disadvantageous to do so, but again, for the moment, once you get past a certain level of wealth in the US, the SEC stop telling you what you may or may not invest in.

    The other point is that we’re seeing that Mr. Romney has a shitload of money in ‘offshore investments’ as a direct result of him declaring those investments on his federal tax return. His ability to *evade* tax on a portion of his wealth is diminishing daily based on the way the IRS is dealing with non-US banking houses – and he *may* be evading taxes, but what everyone’s pissing and whining about is his openly declared tax liability.

    The conflation is in that you can hold assets offshore as a US citizen, while not investing in offshore funds. Similarly, you can invest in offshore funds without having a bank account offshore (except that it’s complex in practice when you try and transact financially with the offshore fund). Neither situation is illegal, immoral, or even fattening.

    So at the root of the thing, there are people who are building a strawman out of information that demonstrates that Romney happens to be a rich man, who pays the taxes on gains both realized and unrealized of the investments, in accordance with the current law of the US.

    The whole politics of envy thing’s utterly pernicious, and you’re utterly right that progressive taxation is unjust, but Romney (as far as current information goes) is acting in complete accordance with the law.

  2. Paul Marks says:

    Bod you have got the charge wrong.

    I have never charged Mitt Romney with doing anything illegal with his taxes.

    My charge is much more serious….

    That Mitt is a weak and cowardly man who collapses (like a paper bag) when asked a question – even by some subhuman media creature (even that little insect at the last CNN debate).

    I hope I am wrong about Mitt (because of his money he is still most likely to be the nominee – in spite of being blown away with only 23% of the vote in South Carolina), but I have seen him in several debates and he does not impress me as a fighting man.

    And to have any chance of winning at all (against the hate campaign the media will unleash against ANY Republican candidate) the nominee must be able and willing to fight.

  3. Bod says:

    Oh, hardly a ‘charge’, Paul – I was realy using you as a springboard to hang a rant on.

    Mitt’s not just a weak reed, he’s symptomatic of how far the Republican brand has fallen. There’s a hair’s breadth between the establishment GOP and the Democratic party, and when even the GOP themselves label mitt as a ‘moderate’, you know it’s compromise (well, capitulation) all the way down.

    Mitt’s the Annointed One. Note how there’s been no comments this time attacking his Mormon faith. Note that by and large, the issue that Mormons are expected to tithe etc. Nope. Those are being held in reserve. As the media found with Marianne Gingrich, you can only pull that card out of your sock once; but Mitt’s Mormonism is the media’s Magic Bullet.

    It really won’t matter if Romney is a fighter if he gets the nomination. The election goes to Obama unless the media drop the ball.

  4. Paul Marks says:

    Agreed Bod.

    Actually like the fact that Mitt tithes (and he does – and always has).

    I find the stuff about coffee and bad foods a bit alien (how on Earth is Glenn Beck a Mormon? his “lifestyle” is about as healthy as mine is), but Mitt would not force that stuff on anyway else.

    It is the terrible weakness I can not stand – he will go after Newt Gingrich (who will hit him straight back), but he will not touch Barack.

    Try asking Mitt if Barack is a socialist – Mitt will just twist in his seat (as if he was 14 – not 64) and say he does not like President Obama’s policies, but he is sure he is a very nice man (and so on).

    Gingrich will say that Barack is a Saul Alinsky following S.O.B – which he is.

    A “mean”, “angry” Republican who actualy is mean and angry.

    The media will do their normal smear tapdance – and Newt will say “yes – and your point is?”

    I doubt that Newt will win – but he will fight.

    And it is better to have faught and lost – than not to have faught at all.

    By the way – all Mitt has to say on taxes is “this money was taxed already – I invest my after tax income, so the Capital Gains Tax is a DOUBLE tax”.

    But do not wait for him to say this – the msm might not like it.

Leave a Reply

%d bloggers like this: