Debunking the 'TAX THE RICH' lie

When politicians raise taxes on the rich, what do the rich do to protect their $$$? This Prof. shows how high taxes actually made America less equal.

We always hear that the rich should pay taxes more, that our tax rates aren’t high enough. If only we raise taxes we can solve a lot of our problems — inequality would go down and maybe we’d even have more economic growth. Now the funny thing about this view is it really doesn’t comport with our historical experience at all.

LEARN MORE:

TRANSCRIPT:

LEARN LIBERTY:

[joshn]

I work as an IRS revenue agent for the IRS and this video is absolutely correct. The biggest giveaways are to industries like real estate and businesses in general (bonus depreciation for example). Then add in all the loads of low-effort fraud baked in as well where businesses are deducting all sorts of expenses that aren't even business related. The people who pay the highest rates of taxes are those who don't invest in real estate and regular wage earners that don't have a business.

I say get rid of most of the exemptions and deductions for businesses. Take those increased taxes and use that for a higher standard deduction. Make the standard deduction something like 50k for single and 100k for married filing jointly.

Also cut government spending big time.

[DarkHorseSki]

To be fair, this video is more of an argument to eliminate loopholes than it is to reduce the tax rate.

[crb]

People have a right to the fruits of their labor.

[nco_gets_it]

in addition to hiding dollar income, high earners had their income packages changed. Expense accounts, company cars, company phones, company paid clothing. All not income and not taxable for the individual, but also completely deductible for the business. If you have watched Mad Men, you saw that in action although it was not commented on much.

Another way in which the "rich" avoid income taxes is by simply leaving. Right New York, Kaleefornya, and Illinois?

[mickeyd]

The thing that people consistently forget is that the wealthy have options that the rest of us do not. The higher you raise the tax rates, the more incentive people have to move or structure their finances in such a way that they are not reachable by the tax authorities. This can be done in completely legal (or not) you have enough money to do so. The problem is that the jobs and capital investment that the rich support typically leave with them.
HIstory has proven that increasing tax rates doesn't raise the revenue that the government is getting, but it does harm the economy. Who does that punish? It ain't the rich.

[eeLretsiM]

The people who write the tax code, Congress, are all millionaires. There is NO way that they will write tax laws in such a away that they cannot keep their wealth. Tax exemptions, tax shelters, and other loopholes exist because lawmakers of BOTH parties are rich and wish to remain so. As they say, "the foxes are guarding the hen house."

If we tax consumption (sales tax) instead of production, the rich will be taxed more heavily because they spend more money for their luxurious lifestyle. The best/most realistic solution I have heard was Herman Cain's proposed 10-10-10 plan which had flat 10% rates for income and consumption, eliminating exemptions. Taxing consumption instead of production would make tax evasion much more difficult. Getting paid "under the table" would not allow one to escape taxes as it does today.

But, i doubt there will be any meaningful change to the tax code because there are so many people making money from the status quo. Tax preparation is a multi-billion dollar industry. Those corporations (H&R Block, Jackson Hewitt, etc.) lobby Congress to add/change regulations each year for fear you won't need their services if the tax code were ever simplified. They want the tax code to be thousands of pages long to ensure people will continue to buy their services (approx. 11, 652 pages).

[Kaede-Sasaki]

Many people dont understand tax brackets ans think that 90% tax rate means 90% on total income if they make that amount.

The way brackets actually work is not that. Say you have 0% tax from $0 - $100, 000, and 50% tax on $100, 001+, a person earning $100, 100 would pay just $50 of income tax (0% × $100, 000 + 50% × $100).

[ThirtytwoJ]

Competition, not force. Expecting too much from a waitress.

[papaspeleo]

If money is only digital(only imagination) why still pay taxes.

[Katsurenjo]

Ok, granted things were not always as they seemed. But the most important aspect of not tax penalizing the wealthy is not about cheating the system. It's about giving them the incentive to expand. Take entrepreneurial risks of investment employment. Try new technologies. New types of services to be innovative. You want to encourage that not discourage that. I always think back to the idea of tax as an unnecessary requirement. Let's say your government was there just to protect the country overall. Protect you from people violating your rights. Help you enforce contracts you know so people's agreements actually have some kind of legal power behind them. If government would just stick to only those things and they were actually protecting your rights, wouldn't you be willing to pay for that? I don't know about you but I would definitely pay for that. I don't want foreign armies coming into oppress and steal from us. I don't want thieves to think they can just show up, take my stuff whenever they feel like it and assume nothing's going to happen. I'm willing to pay for military and police even courts of law. Which excludes about 98% of what the government now does.

[josbertoromero]

As per IRS report the top 1% pay 45% of all income tax and the top 10% pay 76% of all income tax. In the US. The bottom 30% has actually far more benefits than tax paid. Tax brackets above 5O% are contra productive.

[JBramson]

Is this a re-upload? I feel like I've seen it before.

[dannysullivan]

Taxes need to go up, programs need to be cut. Neither party wants to deliver that message. Debunk? No, simplistic.

[grejsancoprative]

Tax the rich are indeed an argument from rich people, cause only rich people think pilling more money on a problem will make that problem go away. And the suits who see possibilities to benefit from it just toots along

[watchdealer]

This could've been 3 hours long. Really enjoyed.

[mapmanlxii]

Sad but we may be headed to those levels again if we can’t get federal spending and deficits under control.

[matthewash]

Corporate tax rates! Cheaper to make it and ship than to make it here!

[mkeyx]

What I find most deleterious is that the tax cattle develop this asinine mindset about how them (the cattle) should be in charge of deciding who should be taxed the most (the "rich"). The cattle obviously do not have any idea how this would work, but still they don't give up and hold on to this completely ridiculous line of thinking. They are just parroting stupid stuff they heard on teevee.

[josbertoromero]

We have now to pay for the millions that are entering…

[lv]

Well I’d be for the poor since they make millions of jobs, but unfortunately those are all bureaucrat positions that only require great skills in paper shuffling and data fabrication regarding their great successes.