Why Tax Rates Matter More Than Taxes | Intellections

Marginal tax rates – how much someone is taxed on the next dollar they earn – affect how much people work, save, and invest. Everyone is affected by their marginal tax rate, and lower marginal tax rates lead to more rapid economic growth.

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[jarodh-m]

This video is clearly created by people who have never lived on the margin economically. If you live from paycheck to paycheck, you are not thing about your marginal tax rate unless it would mean you would make so much less than your normal pay that you are basically paying to work. For most wage-earning people, an extra dollars today is an extra dollar to pay a bill or feed your family.

[jasoncook]

When is working overtime going to push your next earned dollar from a 20% tax bracket to a 50% bracket? In what reality is this proposed scenario actually affecting the productivity of an average employee? If I remember correctly, the highest tax bracket for personal income is about 39.5% at $440K, also, chances are at any income over $70K you're making a salary instead of being paid an hourly wage. Please tell me who in the middle and poorer classes this video is helping and if you can I'll stop calling it propaganda to manipulate public opinion on tax policy... Which it unabashedly is.

[leibowitz]

To be convinced of the reality of the relationship: lower marginal tax=earners willing to work longer hours, I will need to see controlled studies that support that thesis. My working experience was that the vast majority of hurly employees work hours fixed by the job; salaried employees do not make more money for overtime; hardly anybody will give up a promotion to a more responsibility, higher paying job because it puts them in a higher marginal bracket.

[aaronsheats]

what this video doesn't talk about is the difference in pay for those taxes rates, if you make more you get taxed more, if you make less you get taxed less. If you take that into account the person getting taxed more is still making more than the one getting taxed less and would make him or her want to work more not the other way around. If i make min wage and lets say get 500 net a week, and they take 100 in taxes, i get 400 per week. if i make 600 and get taxed 150, im still making 50 more than before and still paying more taxes. At that figure i would work more often than before as I'm making more. If im working my ass of for crap money i will not stay there long for i would be looking for better work, but in general if i can find a job that pays more i will want to work there if i meet the requirements for that job.

[hughesbrian]

This argument is an economic fallacy. Just because Burger King pays shit for an hourly wage doesn't mean people don't work it. Everyone needs money for food and a roof over their heads. People work because they have to plain and simple, full stop. During the 40's-50's business tax rates were nearly 90% and these were known as America's golden years.

[Code_Dee]

Eisenhower's top marginal rate of taxation was 90% and we had great economic growth in that period...

By today's standards he would be considered a friggin socialist!

[roqvobv]

I'd rather have a consumption tax. People would be a lot more responsible with their money.

[brynwhitehead]

As long as it doesn't move it's nontaxable.
Never sleep.

[Alexander-vgss]

Think it’s a video trying to get the working class to support low taxes for the rich :p

[kindnessfirst]

How much I pay in taxes is more important than how much I pay in taxes?

[keithdyer]

Get rid of the income tax and replace it with a land-value tax. It’s a progressive tax, yet the marginal rate is zero. Best of both worlds!

[dustwarewolf]

Slightly oversimplified here, both this video AND my response to it.

[preoximerias]

Now, after figuring out marginal tax rates comes the bigger issue, who gets taxed what? The wealthy have the money to invest in creating/expanding a business thus driving the economy. So, the Republican way of just slashing taxes related to the wealthy makes sense.

What gets glossed over is poor and middle class taxes. While they do get tax cuts, they pale in comparison to that of the wealthy. Tbh, poor and middle class are about as important if not more than the wealthy interns of driving economic growth. Having less taxes on those groups leads to them spending more, thus driving the wealthy to invest. The idea is to cut down the size of government while slashing taxes for everyone, not just the wealthy.

[Code_Dee]

Any serious economist will tell you that taxing the super rich at high rates is conducive to economic development and more responsive democracy, and it won't even affect the rich's quality of life. If you take in a billion dollars in a year and get taxed 90%, you still have 100 million dollars to play around with so spare the tears.

[Code_Dee]

We need to drastically increase taxes on the super rich and close the loopholes; they only pay 40% in taxes nowadays and that's if they don't take advantage of things like the carried interest loophole, which they do. Billionaires today can get away with paying 20% in taxes... that's a lower rate than the 25% levied on people earning 40k a year!

[algerianprophet]

Tax the rich, help the middle class grow just like how it was dreamed of being!

[Khari]

This video is hilariously preposterous. No one with a business is going to work harder or get lazy due to taxes. If taxes are the reason you decide not to work, you were never a real businessman or businesswoman in the first place. The idea that taxes some how influences how hard people work for their money is laughable. No one starting a business decides not to start one because the tax rate increased or decreased by a few percentage points. People start businesses to make a better life for themselves. If you really want to make it in this country, the government isn't going to hold you back and if you seriously blame your failure on the government, you never had it in you to be successful in the first place. So the premise of this video is entirely flawed. If the tax rates increase, the CEO's of Walmart and Amazon are going to be just as rich and just as able to maneuver with their hundreds of billions of dollars. If you want to have a debate on taxes, cool. But don't structure your argument on complete falsehoods that have no basis in reality. No CEO running a successful business is going to shut down because of the government increasing taxes by a small marginal rate.

[drdca]

Nice video, makes sense.
I deleted the rest of this comment because I, suggested something that was already the case, because I hadn't checked. Oops.

[cali_bay_fbmoney]

The answer is simple a universal economy