Tag Archive: Tax Avoidance


Where In The World Have Tax Increases Made Things Better?

 

 

 

 ” The problem is it’s not true. Raising taxes only makes things worse. The vintage conservative nostrums about higher taxes reducing revenue and enervating economies still hold.

Look at Great Britain where former Prime Minister Gordon Brown pushed through a tax hike shortly before voters booted him in 2010. Wealthy earners saw their rate increase from 40% to 50%. The top rate for capital gains also shot up 10%.

The results have been catastrophic for Britain’s economy. In 2010, there were more than 16,000 people in Britain declaring income of 1 million pounds or more. With Brown’s new taxes, that number dropped to just 6,000 as the wealthy either left Britain or trimmed their income to avoid taxation. Earlier this year, under Conservative Prime Minister David Cameron, the government announced it would drop that rate from 50% to 45%. Since then, the number of residents declaring 1 million pound incomes is up to 10,000.

Higher tax rates lead to fewer millionaires; lower tax rates lead to more millionaires. It’s as clear an illustration as you’ll ever see. And far from increasing revenue, Brown’s tax burden actually cost the treasury 7 billion pounds. Britain’s economy has stalled since Conservatives took power, leading various Krugmanians to reflexively scream “AUSTERITY!” every time they hear an English accent. Britain’s recession is complicated but one of its real causes is surely “TAXES!” “

 

 

Illustration By Gary Varvel

 

 

About these ads

It’s Not Like They Are Captives Or Something … Yet

 

 

” One of the biggest mistakes liberals tend to make is assuming a static response from the people being taxed.

This is a big mistake, particularly when you’re talking about the rich. The rich — being rich — have lots of options. They can hire the best accountants to find loopholes, hire lobbyists to create loopholes, shift their money around to protect it from the tax man, stop working, and, yes, as the Britons are finding out, they can also JUST LEAVE.

In the 2009-10 tax year, more than 16,000 people declared an annual income of more than £1 million to HM Revenue and Customs.

This number fell to just 6,000 after Gordon Brown introduced the new 50p top rate of income tax shortly before the last general election. “

A Very Good Question 

 

” Basically because he’s a rich, successful guy (which is why a lot of people are listened to on a lot of subjects).

To that end, economist and former Romney advisor Greg Mankiw has a short post talking about Buffett as a master of “tax avoidance,” wherein he lists four things Buffett does to avoid paying taxes. “

 

 

 

 

” Other folks, in the past, have charged that Buffett specifically benefits from the tax proposals he backs.

Tim Carney of the Washington Examiner has pointed out:

Buffett regularly lobbies for higher estate taxes. He also has repeatedly bought up family businesses forced to sell because the heirs’ death-tax bill exceeded the business’s liquid assets. He owns life insurance companies that rely on the death tax in order to sell their estate-planning businesses.”

 

 

Remember This :

 ” But if he were truly sincere, perhaps he might simply try paying the taxes the IRS says his company owes? According to Berkshire Hathaway’s own annual report — see Note 15 on pp. 54-56 — the company has been in a years-long dispute over its federal tax bills. “

 

And This :

 ” What is represented by the 6% or 11% statutory rate v. “paid” differential?  “Loopholes”, aka the normal operation of the tax code.  The taxes are not legally payable yet as a function of the tax code and may never be actually paid if the changes in asset values are not “recognized” for tax purposes.   However it’s important to note that the 11% or 6% differences are not exactly chump change either.  5.9% of the pre-tax earnings total of $38.2 billion reported over those three years represents $2.2 billion in arguably “underpaid” tax and the 11.1% differential would represent $4.25 billion “underpaid” tax.  If Berkshire were an “evil” oil company these figures would likely be spun this way. “

Going Galt

  ” Oddly here, and this speaks to how silly the economic discussion has become, founder Mark
Zuckerberg is being lionized for the presumed $ 1 billion in capital gains taxes he’ll pay the feds.
Saverin’s avoidance plan means more capital for business growth while Zuckerberg’s non-
avoidance ensures more feeding of the beast, yet Saverin’s the bad guy? Yes, very odd. ”

Good for Eduardo , good for us all .

TAX AVOIDANCE : It’s everyone’s responsibility .

Follow

Get every new post delivered to your Inbox.

Join 6,676 other followers