Quote:
Originally Posted by kailin
"Taxes should be higher. Very high, on rich people. Not only because it works, but also because I believe large disparities in wealth are bad in and of themselves."
What is your definition of rich? What tax brackets we talking about here? How much higher should taxes be on wealthier people, and lastly, do you think taxing people who earn higher income will hurt their incentive to work hard.
Where is the incentive to work hard if the government is going to take it away and give it to the less fortunate?
I don't know where the brackets should be. If we know what revenue needs to be, we an try to set them, but I need data that I don't have.
My gut feel is that it should be very hard to get more than ten times more wealthy than average. Maybe that works as a cutoff.
As for incentivization of work: That's overrated. If things are arranged so that the marginal rate is fairly low on
earned income through a reasonably high number (which is possible), then most people have at least the incentive they do now (I think it can be done with low brackets, on earned income only, that aren't much higher, or maybe not at all higher, than the US uses now — I'm not sure this is right, it's a guess.) Meanwhile, taking away most of the financial incentive to make big numbers — say above a few hundred thousand a year, perhaps — would result in very little loss of productivity, because such people constitute a tiny part of the useful labor market. In fact, in most cases they do no useful work at all, they just transfer wealth.
The bigger change would be on taxation of unearned income, which could be made uniformly high without hurting production much, and oin the passing on of wealth to children, which could be made impossible in most cases (Family businesses being the exception, with limits) without hurting things at all.
Couple that with the fact that i don't think a loss of productivity would necessarily be bad, and that's how I conclude this could work.