Comments on: US Tax Rates Illustrated

By: Redgreen

Redgreen — Sun, 09 Dec 2012 00:15:18 +0000

The idea that a government would have the right to take 73% of anyone’s property (or money) is insane. Until we get a flat tax, where all pay one number and there are zero deductions the US tax code will be a mess.

We are solving our problem by my wife going part time and we’ll drop into the 33% tax bracket. We don’t spend anywhere near what we make and are saving as much as possible so that we be in a position retire well, and live off very little income. We know that there’s a possibility that our investments will be heavily taxed by that’s life. We have no kids and plan on spending every dime so that the government doesn’t get a penny. The remains will go to charity.

By: jose

jose — Thu, 06 Dec 2012 21:31:33 +0000

Thanks Ken…. interesting take re:prospect theory. Hand’t thought about it that way before. I inagine there’s ome work out there on lobbying for loopholes after an tax rate increase.

By: Kenneth M. Kambara

Kenneth M. Kambara — Thu, 06 Dec 2012 07:12:31 +0000

Great post, José. What are your thoughts on tax policy being more independent of a welfare distribution effect? In other words, disaggregate the two. Collect tax revenues in a “fair” manner and redistribute outside of tax policy. I think the problem is you would have to address the deductions/loopholes, which is a third rail issue save for the more die-hard libertarians.

I see the sharp rise in the top income marginals to be subject to prospect theory, so that the losses from increased taxation are going to be overvalued, psychologically, resulting in more aggressive deductions and lobbying for more tax loopholes.

By: FLUCTUATIONS IN TOP TAX RATES: 1910 TO TODAY | Welcome to the Doctor's Office

Mon, 03 Dec 2012 21:07:42 +0000

[…] the top tax rate should optimally be 73%. Sociologist Jose Marichal, however, at ThickCulture, observes that tax policy has rarely been about what is optimal for society. Instead, he writes: What […]