Tax Cuts

[Beerina]

Because it boosts the economy. Taxes are a "necessary evil" (though I must grant "necessary" for the sake of argument.) They are "evil" because they place a drag on whatever is being taxed.

 

[MattusMaximus]

This will be an interesting game of chicken, but I think that those advocating for President Obama's plan will ultimately win out. Why? Three words: lame duck session.

After the election but before the new Congress is seated the pressure will be off, and President Obama will be able to get enough votes to push through his plan. Which is good, because I think his plan is the smartest one if you want to preserve the majority of the tax cuts while attempting to bring down the deficit.

 

[wastepanel]

I would doubt that much factory equipment is sold at a gain.

Actually, it happens quite often. A fixed asset such as factory equipment is depreciated (expensed) over a period of time rather than all at once. If I bought a piece of equipment 18 years ago and fully depreciated it, then sold it for $100, I would have a capital gain of $100.

 

[eeyore1954]

But typically that type of sale is not taxed at the capital gains rate but instead as ordinary income because of depreciation recapture. I should have said sold at a gain that is eligible for the lower capital gains rate.

 

[Praktik]

Simon Johnson on taxes:

The president should be pushing harder for agreement on medium-term deficit reduction, including by putting forward ideas for comprehensive tax reform. The US system has become complex and quite opaque – people have a hard time figuring out what taxes they are pay and what they get in return. Tax systems elsewhere in the industrialized world are just as (or more) progressive while also being more efficient, i.e., cause less distortion in terms of reducing the incentive to work and to invest per dollar of revenue collected.

In the context of redesigning the tax system to promote employment and responsible savings, it is entirely appropriate to look for ways to shift the burden of taxation back to relatively high income individuals. This group has had a great run over the past 30 years – while the consequences for most Americans, as seen for example in real median wages (flat), the stability of employment (look around you), or the vulnerability to financial crisis (2008-09 was a wake-up call), have been much less favorable.

The president’s latest proposals are tinkering at the margins and will likely only have a limited impact. But if the president moves the broader debate towards considering fair, reasonable, and efficient ways to tax higher income individuals, this is a step in the right direction.​

 

[Snide]

FWIW:

Wealthy Americans likely to save tax cuts instead of spending

"I would tend to wonder how much the tax cut actually influences spending behavior," said Chris Cornell, an economist who mined government reports back to 1989 for Moody's Analytics.

"Spending by the top 5 percent of households seems much more closely tied to business cycle issues than it does to tax cut issues."

The Moody's research covering couples earning more than $210,000 found spending by the wealthy is more likely to be influenced by the stock market than changes in income tax rates.

 

[Biscuit]

Because it boosts the economy. Taxes are a "necessary evil" (though I must grant "necessary" for the sake of argument.) They are "evil" because they place a drag on whatever is being taxed.

The roads they pay for are a drag? The water lines and sewers lines? Police and fire? Without these and so many other tax payer provided services business could not work at all. There is nothing evil about creating infrastructure it is just necessary.

 

[Beerina]

The roads they pay for are a drag? The water lines and sewers lines? Police and fire? Without these and so many other tax payer provided services business could not work at all. There is nothing evil about creating infrastructure it is just necessary.

Read what I said. They are a drag on whatever they tax.

That somebody skips along and bubbles, "Hey, they do something good with it!" doesn't mean it's a drag on somebody else.

Secondly, I could grant you every last bloated, wasteful infrastructure and police, etc. and we still wouldn't be touching a significant amount of the bloated federal spending.


Why hide behind a "success" to justify Fail?


I'm sure that 1200 pound woman eats a salad now and then, therefore she's a success?

 

[Biscuit]

Read what I said. They are a drag on whatever they tax.

That somebody skips along and bubbles, "Hey, they do something good with it!" doesn't mean it's a drag on somebody else.

Secondly, I could grant you every last bloated, wasteful infrastructure and police, etc. and we still wouldn't be touching a significant amount of the bloated federal spending.


Why hide behind a "success" to justify Fail?


I'm sure that 1200 pound woman eats a salad now and then, therefore she's a success?

I won't disagree that there is wasteful spending within government, you can always trim some fat. However, without this "drag" most business would come to a halt. Without the services provided by the government something as simple as a cross state delivery would become nearly impossible.

My business, a coffee shop, would be devastated without the services my tax dollars pay for. Without airport control towers or customs officers I wouldn't be able to even get coffee beans. Without water safety standards being monitored I would poison my customers. Without the nearby court buildings and associated employees I would lose over half my business. I don't see taxes as evil at all.

 

[thaiboxerken]

I won't disagree that there is wasteful spending within government, you can always trim some fat. However, without this "drag" most business would come to a halt. Without the services provided by the government something as simple as a cross state delivery would become nearly impossible.

My business, a coffee shop, would be devastated without the services my tax dollars pay for. Without airport control towers or customs officers I wouldn't be able to even get coffee beans. Without water safety standards being monitored I would poison my customers. Without the nearby court buildings and associated employees I would lose over half my business. I don't see taxes as evil at all.

Socialist!