this post was submitted on 01 Nov 2024
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Work Reform

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[–] [email protected] 17 points 3 weeks ago (1 children)

That wouldn't catch the people who are the real problem, billionaires, who report something like $1 per year in income.

When you have billions in shares, you can use that as collateral to borrow money from the bank, and then you just spend that money. That's not "income" so it isn't taxed.

What's needed is a 90% tax on people reporting high incomes as a start. But, then you need to close loopholes. The carried interest loophole for a start, which would nail most of the hedge fund crowd. Then, tax unrealized gains when they're in the tens of millions range. Then prevent billionaires from handing billions to their children tax free by preventing the "stepping up" of capital gains for their heirs.

[–] [email protected] 1 points 3 weeks ago (1 children)

If I have $250k in shares I can also use that as collateral for a mortgage to buy a house. It would be pretty odd and problematic to be taxed on that like it's income when it's not, despite me spending it on a house..because I need to pay it back.

I agree with the rest though. And definitely would love to see 90% for anyone reporting extremely high incomes.

[–] [email protected] 1 points 3 weeks ago

Obviously, the kinds of unrealized gains that are a problem aren't $250k that someone uses for collateral on a mortgage for a house they plan to live in. The problems are the millions or billions in unrealized gains that someone might use to get a $10 million loan from the bank that they then use to lobby the government to open up new loopholes in the tax code.

Taxing wealth and/or unrealized gains is tricky to do right, but not doing it at all is even trickier. If you let the ultra rich just keep getting richer, they'll continue to use that wealth to control the political process to make themselves richer and more powerful. Obscene levels of wealth inequality and democracy can't coexist.