Tag Archives: Taxation

General discussion

Taxation ontology

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Many have heard by now of Mitt Romney's relatively low (well, very low) tax rate: 13.9 percent on one accounting, 15 percent on another.  This is because his income does not come from work, but rather from dividends and other investments.  These are taxed at a different rate from work. 

I am going to grant that there are arguments for taxing investments differently from work.  Some of these arguments might be good ones, or at least strong ones.  The one Romney offered in is own defense, however, is not one of them. 

Here it goes (via TPM):

Romney’s argument is that even though he pays only 13.9%, he’s really paying something like 45% to 50% because the investment income he lives on comes from corporations. And those corporates also pay taxes. The nominal corporate tax rate is 35%, though of course many pay much lower. But if you add Romney’s rate together with this completely unrelated corporate tax he doesn’t pay, you get 50%, which Romney is now saying is real tax rate. In other words, he’s claiming he pays both taxes.

See the video at the link.  I'm trying to figure out the ontology of this claim.  It seems like Romney is saying that taxation runs with the money, as it were.  So if a corporation (which is, after all, people for Romney) makes profits, those profits are taxed.  That taxation counts for all of the money that then gets paid out in whatever way by that corporation (including the rise in the value of the stock price, etc.).  If the corporation puts the money back into the business, and then later sells the business, the money has already been taxed!  If a corporation pays me to do work for it, then I can claim the money they pay me has already been taxed!  If I buy a product in a store, I can claim that sales tax has already been paid in huge amounts!

I think this only works if corporations are literally people. 

Also, in the video, Romeny included his charitable contributions in his tax burden.  Taxes and charity are significantly different, however.  Taxes are obligations to your fellow citizens.  Charity is up to you.  I don't think he wants us to start thinking of the Mormon Church as a tax-supported entity. 

General discussion

It belongs to him

In the "can't tell if troll category" here is Michelle Bachmann on taxation:

KELLY: Thanks, Bret.

Congresswoman Bachmann, after the last debate, a young member of the California Tea Party said he didn’t feel he had had his question fully answered. And it’s a question that received the most votes on Google and YouTube on the list, as well. The answer his question is a number. And the question was, quote, “Out of every dollar I earn, how much do you think that I deserve to keep?”

REP. MICHELE BACHMANN, R-MINN.: And after the debate, I talked to that young man, and I said I wish I could have answered that question, because I want to tell you what my answer is: I think you earned every dollar. You should get to keep every dollar that you earn. That’s your money; that’s not the government’s money.

(APPLAUSE)

That’s the whole point. Barack Obama seems to think that when we earn money, it belongs to him and we’re lucky just to keep a little bit of it. I don’t think that at all. I think when people make money, it’s their money.

Obviously, we have to give money back to the government so that we can run the government, but we have to have a completely different mindset. And that mindset is, the American people are the genius of this economy. It certainly isn’t government that’s the genius. And that’s the two views.

President Obama has embraced a view of government-directed temporary fixes and gimmicks. They don’t work. He’s destroyed the economy. What does work is private solutions that are permanent in the private sector. That gives certainty; that will grow our economy.

(APPLAUSE)

This is idiocy of the highest order–both question and answer.  For the idiocy of the question, listen to Elizabeth Warren.  Concerning Bachmann here, three obvious–and I think disqualifying for the job of Congressional janitor–logical problems.  (1) Obama doesn't think anything like what she alleges and (2) she thinks there ought to be taxation but people should keep all of the money they earn; (3) the red herring at the end urging that the private sector ought to fix the economy.

Sadly, over at TPM, a site I can't figure out, here is the headline: "Michelle Bachmann: Taxpayers Ought to Keep Every Dollar They Earn."  She does not actually put the matter in this obviously self-contradictory way ("taxpayers should not be taxpayers").  But she does say something idiotic.  And the most idiotic thing I think is the last bit about how doing nothing about the economy is what ought to be done.  Yet, sadly again, in most of the stories I surveyed this morning about this quote (googling the quote that is), the end bit was cut off. 

My own view is that the straw manner (such as Bachmann obviously is) deserves no charity; but that I'm going to predict is what people will object to about this story–"Bachmann misquoted!"  This misquote will justify the iron man in their mind.  And this is sad, I think.