Wednesday 22nd of September 2021

death and taxes...

taxestaxes

House Democrats’ plans to raise taxes on the rich and on profitable corporations stop well short of the grand proposals many in the party once envisioned to tax the vast fortunes of tycoons like Jeff Bezos and Elon Musk — or even thoroughly close loopholes exploited by high-flying captains of finance.

 

Instead, the House Ways and Means Committee, influenced more by the need to win the votes of moderate Democrats than by progressive Democratic ambitions, focused on traditional ways of raising revenue to pay for the party’s $3.5 trillion social policy bill — by raising tax rates on income.

The proposal, which is set to be considered by the panel on Wednesday, does include measures to raise taxes on the rich. Taxable income over $450,000 — or $400,000 for unmarried individuals — would be taxed at 39.6 percent, the top rate before President Donald J. Trump’s 2017 tax cut brought it to 37 percent. The top capital gains rate would rise from 20 percent to 25 percent, a considerably smaller jump than President Biden proposed.

A 3-percent surtax would be applied to incomes over $5,000,000.

But more notable is what is not included. The richest of the rich earn little money from actual paychecks (Mr. Bezos’s salary from Amazon was $81,840 in 2020). Their vast fortunes in stocks, bonds, real estate and other assets grow each year largely untaxed.

The Senate Finance Committee wants to tax that wealth with a one-time surtax imposed on billionaires’ fortunes, followed by levies annually on the gains in value of billionaire assets, the way property taxes are adjusted each year to reflect gains in housing values. The Ways and Means Committee shrugged that off.

Representative Bill Pascrell, Democrat of New Jersey and a Ways and Means Committee member, conceded on Monday that the real wealth in the country is tied up in assets, not large salaries, but he said many Democrats were leery of going too far.

“I am very suspect of a wealth tax,” he said. “I think it’s perceived as ‘soak the rich.’ I don’t think it is, but that’s how it’s perceived.”

 

The committee did take aim at a loophole in retirement savings exploited by billionaire Peter Thiel, who, according to a ProPublica investigation, was able to take a Roth individual retirement account worth less than $2,000 in 1999 and grow it to $5 billion, which could be completely shielded from taxation.

In a Roth I.R.A., small annual deposits of money from previously taxed income are allowed to gain in value free of capital gains taxation, as long as it the funds are withdrawn after retirement. But Mr. Thiel, the founder of PayPal and a prominent Silicon Valley conservative, opened his Roth, then deposited stakes in start-up companies at fractions of pennies a share, which then exploded when the start-ups took off. The gains in value — and investments made in other companies from those gains — will go completely untaxed if Mr. Thiel waits to withdraw it just before he turns 60.

To prevent such exploitation, the Ways and Means Committee would stop contributions to retirement accounts once they reach $10 million.

In other areas, the committee appears to be making only glancing blows at the nation’s highest fliers. Barack Obama, Mr. Trump and President Biden have all vowed to close the so-called carried interest loophole, in which private equity managers pay low capital gains tax rates on the fees they charge clients, asserting that it is not income since it is drawn from their clients’ investment gains.

Senate Democrats hope to close the loophole completely, saving the Treasury $63 billion over 10 years. The House proposal would force Wall Street financiers to hold their clients’ investment gains for five years before claiming them as capital gains and cashing out, a demand that could limit the use of carried interest, but would save a fraction of the Senate proposal, $14 billion.

 

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confidential IRS data...

Bezos, Buffett, Bloomberg, Musk, Icahn and Soros pay tiny fraction of wealth in income taxes, report reveals


PUBLISHED TUE, JUN 8 2021  11:12 AM EDT  UPDATED TUE, JUN 8 202  13:14 PM EDT

 

Some of the world’s richest men — Jeff Bezos, Elon Musk, Warren Buffett, Carl Icahn, Michael Bloomberg and George Soros — pay just a tiny fraction of their increasing wealth in taxes, and in some cases pay no taxes in a given year, according to a report Tuesday.

ProPublica, citing confidential IRS data it obtained on thousands of wealthy people, reported that the 25 richest Americans “saw their worth rise a collective $401 billion from 2014 to 2018.”

 

But those people paid a total of just $13.6 billion in federal income taxes for those five years, which “amounts to a true tax rate of only 3.4%,” the article noted.

 

In contrast, the median U.S. household in recent years earned around $70,000 annually and paid 14% of that in federal taxes. Couples in the highest income tax rate bracket paid a rate of 37% on earnings higher than $628,300, the report said.

 

Read more:

https://www.cnbc.com/2021/06/08/bezos-musk-buffett-bloomberg-icahn-and-soros-pay-little-in-taxes.html

 

But the rich philanthropied to the max, didn't they? Or flew higher that the Cosmos, didn't they? And please, whoever says that Trump is panicking about his tax returns being published is in dreamland... He DOESN'T CARE people knowing his tax fiddles that are no worse than any other rich guy, but only objects on the principle... Like the other rich guys, Trump "philanthropied" — giving his salary of President to a "charitable" enterprise...

 

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(CNN) Democrats have been waiting for years to reimagine the tax code so that, in their words, the wealthy are paying their "fair share" and working and poor families aren't disproportionately hit with the tax burden. But overturning key pieces of the GOP's 2017 tax law -- a boon for businesses that lowered individual and corporate taxes -- won't happen without a bruising fight, potentially within their own party.

Special interest groups are already preparing for a sustained campaign against those changes, and the next weeks will test whether Democrats have the resolve to make good on what has been a campaign slogan up until now.  "I still think we can find the revenues to do the $3.5 trillion," Sen. Mark Warner of Virginia, a Democrat on the Senate Finance Committee, said of his party's sprawling spending package. "If we cannot generate the revenue, it all becomes somewhat moot."  He added, "It's not going to be easy." Read more: https://edition.cnn.com/2021/09/13/politics/democrats-trump-tax-cuts/index.html

 

 

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2.1 trillion under the carpet...

House Democrats’ Plan to Tax the Rich Leaves Vast Fortunes Unscathed


The House Ways and Means Committee’s proposal to pay for trillions in social spending leaves wealth gains and inheritances largely alone. It focuses instead on a more traditional target: income.

 

WASHINGTON — House Democrats on Monday presented a plan to pay for their expansive social policy and climate change package by raising taxes by more than $2 trillion, largely on wealthy individuals and profitable corporations.

But the proposal, while substantial in scope, stopped well short of changes needed to dent the vast fortunes of tycoons like Jeff Bezos and Elon Musk, or to thoroughly close the most egregious loopholes exploited by high-flying captains of finance. It aimed to go after the merely rich more than the fabulously rich.

Facing the delicate politics of a narrowly divided Congress, senior House Democrats opted to be more mindful of moderate concerns in their party than of its progressive ambitions. They focused on traditional ways of raising revenue: by raising tax rates on income rather than targeting wealth itself.

Representative Dan Kildee of Michigan, a Democrat on the Ways and Means Committee, which crafted the plan, called it “the boldest common denominator.”

“Being for something doesn’t make it law; 218 votes in the House, 50 votes in the Senate and the president’s signature make it law,” he said, adding, “What I don’t want is another noble defeat.”

The proposal includes nearly $2.1 trillion in increased tax revenues, the nonpartisan Joint Committee on Taxation estimated on Monday. Democrats say those increases will go a long way to funding President Biden’s ambitions to expand the federal government’s role in education, health care, climate change, paid leave and more.

 

Read more:

https://www.nytimes.com/2021/09/13/us/politics/tax-plan-democrats.html

 

At this stage it seems that "President Biden's ambitions" are not his own, but that of the boffins running his administration. Biden's mind seems to be half-way to lalaland. White House staffers ... told Politico that they prefer muting President Joe Biden during his public speeches over anxieties that he may divert from the pre-planned course too much — and talk nonsense, meaning that he thinks nonsense should he think at all. 

But the "liberal" media like the New York Times have to maintain the illusion that Joe Biden is in control of the situation, to reinforce that the latest presidential elections ensured the USA ended up with the right guy at the helm. Imagine the MSM having to say "folks, you voted in an old dud to avoid having more of Trump-the-Mad instead. Congratulations...! We will arrive in Dumbville Central at 3:45 PM..."

 

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