Capital gains & income averaging.

[Supposn]

Capital gains & income averaging.

Long term capital gains are not economically more or less beneficial than incomes derived from entrepreneurs’ steadily nurturing and reinvesting into their enterprises.

I am not opposed to speculators but I’m opposed to using tax policy to favor any business model over others.
Unlike the proponents of the long term capital gains tax loopholes, I prefer our government promote transparent open markets that we all may be able to trust.

There was an “income averaging” provision within our income tax regulations that mitigated progressive tax rate’s excesses when applied to the filing’s year’s taxable income.

This tax reduction rewarded but was not limited to wealthy investors or those that sold their homes. It benefitted lottery or quiz program winners, sport or entertainment figures, inventors or anyone else that hit ANY KIND of financial jackpot within the taxable year for which they were filing an income tax return.

It compensated those who were lucky or daring or devoted years for study or practice of their chosen professions.
It was of no particular benefit to those with comparatively level annual incomes; (such as a Buffett , Romney or your mailman).

I advocate elimination of the long term capital gains loophole and restoring the income averaging,

Respectfully, Supposn

 

[DodgeFB]

Capital gains & income averaging.

Long term capital gains are not economically more or less beneficial than incomes derived from entrepreneurs’ steadily nurturing and reinvesting into their enterprises.

I am not opposed to speculators but I’m opposed to using tax policy to favor any business model over others.
Unlike the proponents of the long term capital gains tax loopholes, I prefer our government promote transparent open markets that we all may be able to trust.

There was an “income averaging” provision within our income tax regulations that mitigated progressive tax rate’s excesses when applied to the filing’s year’s taxable income.

This tax reduction rewarded but was not limited to wealthy investors or those that sold their homes. It benefitted lottery or quiz program winners, sport or entertainment figures, inventors or anyone else that hit ANY KIND of financial jackpot within the taxable year for which they were filing an income tax return.

It compensated those who were lucky or daring or devoted years for study or practice of their chosen professions.
It was of no particular benefit to those with comparatively level annual incomes; (such as a Buffett , Romney or your mailman).

I advocate elimination of the long term capital gains loophole and restoring the income averaging,

Respectfully, Supposn

Thank you for a thoughtful and respectful post. We need more of that.

As to the subject, I am thinking about it. I am just not sure I am smart enough to be sure what is best. I do know this country needs to do something since we are between a rock and a hard place.

 

[myp]

I say we replace capital gains, corporate tax, and income tax (and hence a lot of this 99 vs. 1 and loophole business) with some sort of progressive consumption tax.

 

[Supposn]

A progressive rated sales tax.

I say we replace capital gains, corporate tax, and income tax (and hence a lot of this 99 vs. 1 and loophole business) with some sort of progressive consumption tax.

MYP, the only consumption tax methods that I’m aware of are all forms of sales taxes.

I’m aware of governments identifying items which are a greater portion of lesser income purchases and somewhat reducing the sales taxes applicable to such items; and/or the sales taxes of such items could be entirely reduced or waived entirely or for a capped amount of the selected items’ prices within each individual transaction or within each month’ transaction.

These are all methods that would create a sales tax with somewhat of a progressive characteristic but there’s a limit to the extent of that characteristic.

Respectfully, Supposn

 

[myp]

MYP, the only consumption tax methods that I’m aware of are all forms of sales taxes.

A value-added tax, or VAT, (or something like it) would probably be more conducive to achieving my goal.

 

[skeptic-f]

Doesn't the richer person with a higher percentage of disposable income choose to have a higher percentage of investments and savings compared to their income (compared to the income of the average American household)? Getting rid of some tax loopholes is good, but the rich and very rich would still be getting off easy.

 

[myp]

Doesn't the richer person with a higher percentage of disposable income choose to have a higher percentage of investments and savings compared to their income (compared to the income of the average American household)? Getting rid of some tax loopholes is good, but the rich and very rich would still be getting off easy.

Right now that is what generally happens. Was this response to me though? In that case, my proposal would most likely mean getting rid of capital gains, corporate, and income taxes altogether if the consumption tax can be progressive. A big point of my plan is to rid of loopholes.

 

[Schmidt]

i think there should be a flat tax

 

[myp]

i think there should be a flat tax

That would be a regressive tax; not really fair to the poor.

 

[lam_oxypixel]

this topic is very good i like it

 

[Supposn]

That, (i.e. a flat tax) would be a regressive tax; not really fair to the poor.

MYP, a flat tax method has a single tax rate.
Our progressive income tax method levies a progressively increased tax upon each progressively greater income bracket.

The purpose of progressive taxes is to harvest greater tax revenues and grant some tax consideration to lower income earners and/or lesser sales transaction amounts.
Effects similar to progressive tax rates can be achieved to some extent by adopting tax regulations for that purpose.

Using such methods, even a consumption tax can be drafted to behave more progressively; (refer to posing #4).

I generally advocate to whatever extent practical we eliminate progressive tax rates and where ever practical we adopt alternatives to progressive tax regulations.

My opposition to progressive tax rates are not due to their being inequitable, but rather because they induce the introduction of additional and regressive mischief into our tax systems.

Progressive tax rates were enacted for the very best of purposes but they are inequities. Each faction perceives their (often actual) disadvantages due to the progressive tax rates. They lobby for remedies that mischievously reduce their taxable incomes and evolve our tax system to be somewhat less progressive and more regressive. Layers over Layers of tax loop holes increase. They are as a great onion growing underground.
President Obama’s calls for a “Buffett law” to simply make this it right. His bandaide for a systemic problem will hang on for a short time before it dropping off.

I advocate to the extent practical, we replace taxing net incomes with a general sales tax.

Respectfully, Supposn

 

[myp]

I advocate to the extent practical, we replace taxing net incomes with a general sales tax.

A general sales tax is regressive. A VAT-like tax if implemented in the right way could be a progressive consumption tax- much more desirable.

 

[Supposn]

A progressive sales tax.

A general sales tax is regressive. A VAT-like tax if implemented in the right way could be a progressive consumption tax- much more desirable.

MVP, VAT is a sales tax. I believe it’s the most superior method of sales tax administration.
Sales tax systems are generally single rate, but some nations have different rates for different types of goods.

I’m a proponent of identifying products that are greater proportions of lower income purchasers. Sales taxes could be entirely waived for products such as food not purchased from a restaurant or caterer.
Sales taxes could alsdo be waived for the price threshold of targeted products.

Sales taxes could be waived for the first $75/month for utilities delivered to taxpayers’ primary residences or the first $10 of each single public transportation trip. Those capped threshold amounts should be annually cost of living adjusted. This in effect makes a sales tax to a limited extent somewhat progressive.

Respectfully, Supposn