Turbo-liberal socialist riddled with envy, er, Ron Johnson (R-WI) opposes the tax bill because it overweight its benefits to big business:
Who owns big business? 401k investors and normal people.
Who buys big business’ products? Normal people.
Who works for big business? Normal people.
If you want to pay more taxes just don’t take any deductions. Easy, peasy. You can pay more right now and no one will complain.
My taxes went up, a lot over the last 8 years. I need the cut and the simplification.
Anyone who argues for a tax increase should lead by example and not take deductions, then they have the credibility to argue for an increase.
Less than half of US adults have money in the stock market (including 401Ks).
Retirement accounts hold 37% of US equities. Less than 50% of muricans own stock. But then again many Americans have no investments AT ALL, not even cash. 57 percent don’t even have $1000 saved. For responsible people who save and invest stocks have been a great way to accumulate wealth.
“$0 saved: 39 percent
Less than $1,000 saved: 18 percent
$1,000 to $4,999 saved: 12 percent
$5,000 to $9,999 saved: 6 percent
$10,000 or more saved: 25 percent”
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No argument there. I was more focusing on the word “normal” since that’s usually equated with “majority”.
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That’s an interesting distribution
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And? I’m not saying abolish big business. I just think any smart tax reform does something other than overweight its benefits to big, publicly traded businesses.
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Well like it or not globalism means our corporate tax rates have to be competitive with other nations. The US has the third highest at 38.9%. The worldwide average is 22.5% and the GDP weighted average is 29.5%. We skew that weighted average big time with our GDP and top rate. 20% is not out of line.
It’ll be interesting to see what they do about our worldwide tax system (repatriation) if it’s in either bill. It’s just silly if a US firm makes money in Europe/Asia to tell them that they owe tax on it here too when they bring that cash back. So they just hold that money overseas and borrow here. That’s dumb. The US is the only major economy that does that. It puts us in interesting company (Greece, Mexico, Ireland and South Korea). US businesses are being incentivised to keep their cash overseas, heaven forbid they invest, spend or pay didlvidends here.
It worked in the UK. Corporate tax receipts increased as the rate went down.
The USA grants Europe regulatory arbitrage by maintaining such a high rate.
Edit. Removed link due to paywall.
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And @Basement_Gainz - to be clear, I’m not against cutting the corporate rate in the name of making us more competitive globally. I’m generally for that - unless we’re financing said cuts through borrowing. Since we’re not, this is just stacking up to the the typical GOP giveaway. And I also object to the grab bag of other things.
Where at me, I would lower the corporate rate and offset it with an increase on the capital gains rate.
But let’s be clear, this tax bill is being sold on the threadbare theology of supply-side Magic. It’s the tired sales pitch that if we reduce these taxes, there will be an explosion of investment in productivity, and so the public interest is served by rewarding the private interests of the largest businesses in the world. It won’t happen, it doesn’t work that way, and we’re adding a trillion dollars to our deficit in the meantime, and every expectation is all that newfound cash will be spent on shareholder dividends and stock BuyBacks.
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I don’t disagree, but I long abandoned any hope of the West getting fiscally tough. I do think this will not be as explosive for the deficit as reported, but at 20 trillion, it is somewhat of a superfluity.
A car in every driveway and a pork barrel in every town.
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We could easily balance the budget without firing anyone and without cutting a single social benefit program.
Step 1: federal hiring freeze for 5 years. Retrain people as positions open up. Re allocate what agencies are doing. Let people retire.
Step 2: close 400 of the 800 US military bases. Let the generals and admirals decide which ones and do it smart. But we don’t need 800 to be anywhere in the world in <6 hours.
National debt solved. There, I’ll be accepting my Nobel Prize in economics any day now.
This is just plain wrong. It isn’t massaged into capital gains, they are capital gains. This is why it is frustrating and most of us who do this shake our head and walk away when someone says “loophole”.
The carried interest issue is nothing more than the natural outcome of events. It’s literally just “the way the world works”. Nothing is massaged in any way. The character of income is NOT currently changed by any sort of intentional act, massaging or otherwise. To change the laws as they are, and tax it as OI, is in fact the massaging. (And subsequently where the major issues in how to change the law come into play.)
Saying this and regurgitating Vox style talking points from “journalists” who don’t actually understand taxation doesn’t make it true.
Anyone under those limits who buys business use personal property. It’s only a timing difference anyway, and a 5-7 year one at that most of the time, who’s major differences occur upfront. MACRS isn’t straight-line, 50% or so of the costs of those assets are expensed by the end of year two. So the incentive to purchase durable goods outweighs the tax deferral because it becomes a compounding deferral strategy.
The fault in your logic here is that the tax burden is far, very far, from uniform. The top supports the revenue collection, as they should. They can’t, under any rational system, support all the revenue collection, so any cuts will benefit those with the highest burden more.
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Except it limits your interest expense (good idea, not sold on execution)
Limits loss carryforwards (this is pretty radical and appropriate imo.)
Like kind exchange removal for personal property… This wipes a huge deferral and makes my job easier
DPAD is gone. (Which is largely not understood and flat out abused, but I’m not sold on this idea.)
Meals and Entertainment 50% deductibility is gone. (Say goodbye to your office holiday party lol)
Changes in Patent sales etc are going to hurt heavy R&D businesses
Repeal of the clinical testing credit will produce billions in revenue immediately
If you want to do the former it will be easier if you remove “value” from the latter.
Fucking Trump ruining my life… no more lunch meetings or doughnuts at the Friday morning meeting.
Edit: well, at least I won’t have to turn down golfing, fishing and hunting trips or sporting events anymore.
Huh?
That’s short term thinking though, and over the long timeline of a lifetime, less likely to create wealth.
Then you create the perception of value.