(11-25-2016, 01:49 PM)Warren Dew Wrote:(11-25-2016, 11:55 AM)Mikebert Wrote:Warren Dew Wrote:Billionaires pay virtually no taxes. Warren Buffett pays an effective tax rate of less than one tenth of one percent. See this article from the WSJ for a numerical analysis:
http://www.wsj.com/articles/SB1000142405...1587258988
The idea that people rich enough to buy politicians would allow those politicians to charge them taxes is naive in the extreme.
The link you provided is paywalled. Here is one from Forbes:
http://fortune.com/2016/10/10/warren-buffett-taxes-trump/
It shows Buffet paid taxes:
Adjusted gross income: $11.6 million [$0.01 billion]
Deductible charitable contributions: $3.5 million
Total deductions: $5.5 million
Federal income tax paid: $1.8 million [$0.002 billion]
Buffet’s tax bill does amount to less than a tenth of percent of his net worth, but it is 30% of his his taxable income of 6.1 million.
The key word there being the "taxable" in "taxable income".
As discussed in my link, Buffet's net work increases by on the order of $10 billion - not million, billion - per year. By any reasonable psychohistorical or "cliodynamical" analysis, that counts as income, as it increases Buffet's ownership share and control of the world through his personal holding company. That fact that well over 99% of his income is nontaxable just proves my point. His effective tax rate is less than a tenth of a percent.
It is not income if it cannot be spent. First you assert billionaires don't pay taxes because they pay bribes to prevent it. Then you assert that one can have billions in untaxed income which somehow can bribe politicians without being spent. You are not making any sense.
People who do what Buffet does are why you want highly progressive estate taxes. If you never sell a rising asset you never pay taxes on the gains because they are not realized. When you die the asset is transferred to you heirs, and at that point taxes are paid if you have an estate tax. A fair system would tax billion+ estates at >90%. Then you would collect the taxes avoided while the person lived.
If you have a 401K or a Roth IRA, you enjoy Buffets situation. You net worth grows each year and you don't pay any taxes on this "income". If you then die before you ever withdraw any of it then this asset passes to your heirs and you never pay any taxes on it. If your estate is below a few million the transfer is tax-free and you too will have never paid any taxes on all that "income" you gained throughout your life. Did you bribe politicians to get this arrangement?
The same thing would be true if you held a portfolio of growth stocks that don't pay dividends. Your net worth would grow and you would never pay taxes on this "income". Have you never done any investing?
This tax can still be avoided by giving the estate to charity. Buffet has already started giving it away, probably at the urging of his friend Bill Gates who has already given a big chunk of his fortune to his foundation. Most of Buffet's estate is going to the Gates foundation as well. SO both of the great big fortunes will never be taxed, just as the Ford, Rockefellar and Carnegie fortunes before them. Some elites actually seek to gain the use of their fortunes and to do this requires them to realize gains which gives them income that is then taxed.