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Old 08-02-2009, 12:07 PM   #91
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I want to know who here is paying 40-50% in their effective tax rate? Anyone? Bueller?

Hell, how many are even in the 40-50% marginal tax rate?

It's like a friend of mine who said to me "it's so frustrating when they take half my pay for taxes!" and in reality her effective tax rate is something like 28%.
In Canada here, I must admit that it sometimes feels that way when you factor in not only income taxes, but also the high sales taxes, excise taxes on gasoline, liquor, tobacco, etc., and property taxes. And, of course, let's not forget the added insult to injury with the Ontario government's HST plan for 2010. Now we can add yet another 8% on top of the already exorbitant gasoline prices here!
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Old 08-02-2009, 12:47 PM   #92
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Originally Posted by anitram View Post
I want to know who here is paying 40-50% in their effective tax rate? Anyone? Bueller?

Hell, how many are even in the 40-50% marginal tax rate?

It's like a friend of mine who said to me "it's so frustrating when they take half my pay for taxes!" and in reality her effective tax rate is something like 28%.
That's because leftists don't win elections all the time. Plus you have to look at the overall GDP of the country and how much of that is controlled by the different levels of government. There are provincial/state and municipal taxes. Plus there are government fees as well and sales taxes so when you add it up it's around 40% of the GDP controlled by the government yet less than 40% of the population works for the government. The left says that "well the middle class and poor don't pay as much as the rich but of course the rich (and middle to upper middle class) want rewards for their innovations and work so they make choices in their companies to hire less or fire more or raise prices which affects the middle class and the poor in a negative way.

We all agree here that we need some government but even moderate leftists will have to say no to special interest groups looking for handouts if the country is to stay solvent. The only way is priorities.

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And purpleoscar, if you can feel free to go on about fucking concentration camps and who knows what-all at the drop of a hat, I will feel very free to mention Somalia, an extreme but not unique example of life under a weak state.
I'm not trying to state that you are a NAZI or Communist but I'm pointing out that if socialists want poverty to be cured and their only tool is to create social programs runned by social engineers then (due to my belief that poverty cannot be eradicated without willful people working to change their own habits) the natural conclusion would be to force people to change if your only tool is social engineers. The other way could be using necessity as a motivating factor so working is more comfortable than low paying welfare. That way I avoid using social engineers and get better (yes not perfect) results.

I believe moderation is necessary because we have plenty of evidence that large states can react in same way that gangsters do. By pointing out that it's okay to respect your work and the money you earn is because I don't want people to feel guilty for managing their own money and believe constantly in government solutions and that you are GREEDY for wanting to manage most of your money. I feel that if we are afraid of the government instead of the other way around future generations will be so enculturated in wealth transfers that they won't mind believing in benign dictators taking the responsibility load off of them.

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In Canada here, I must admit that it sometimes feels that way when you factor in not only income taxes, but also the high sales taxes, excise taxes on gasoline, liquor, tobacco, etc., and property taxes. And, of course, let's not forget the added insult to injury with the Ontario government's HST plan for 2010. Now we can add yet another 8% on top of the already exorbitant gasoline prices here!
Exactly. Look at all government fees and taxes from all levels to see how much of your own money you actually control by choice of purchase. Also I would add inflation which robs you of your purchasing power. So far economists feel that the Purchase Power Parity (PPP) is a more useful statistic than even GDP.
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Old 08-02-2009, 12:50 PM   #93
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In Canada here, I must admit that it sometimes feels that way when you factor in not only income taxes, but also the high sales taxes, excise taxes on gasoline, liquor, tobacco, etc., and property taxes. And, of course, let's not forget the added insult to injury with the Ontario government's HST plan for 2010. Now we can add yet another 8% on top of the already exorbitant gasoline prices here!
Exactly.

I agree with Kieran McConville that taxes are the price of civilisation and I do expect basic services, infrastructure and social safety nets. And I'll add policy and programs that allow the disadvantaged the same opportunities as the priviledged. At some point though, government excess, waste and outright corruption start to feel a lot like theft. I expect to get my money's worth.
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Old 08-02-2009, 03:39 PM   #94
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In Canada here, I must admit that it sometimes feels that way when you factor in not only income taxes, but also the high sales taxes, excise taxes on gasoline, liquor, tobacco, etc., and property taxes. And, of course, let's not forget the added insult to injury with the Ontario government's HST plan for 2010. Now we can add yet another 8% on top of the already exorbitant gasoline prices here!
That's true. But you are also choosing to live in an expensive tax jurisdiction so this isn't really an accurate comment for the whole country.

Alberta has flat income tax and no provincial sales tax, for example. Additionally, property taxes are going to be through the roof in downtown Toronto as compared to almost every other place in the nation.

My tax rate was certainly higher when I lived and worked in NYC, and that didn't surprise me...

We have a bad Ontario government, it's time for McGuinty to go (well it was time well before this, but beggars can't be choosers).
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Old 08-02-2009, 04:01 PM   #95
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Hell, how many are even in the 40-50% marginal tax rate?
My marginal rate is exactly 50%. And I am not in the highest bracket either. That would be 52%. Granted, effective tax rates are not going to be anything like as high as that, except for very very high earners, most of whom can use tax avoidance strategies. I think my effective rate is in the ballpark of 35%.

Tax Credits, Reliefs and Rates for the Tax Years 2008 and 2009 - IT1

Social insurance in Ireland-Information from CitizensInformation.ie


I'd reckon the highest income tax rate will be over 65% here within a few years.
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Old 08-02-2009, 04:10 PM   #96
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Do you know how your rate compares to scandinavian countries? I'm interested to see it.

The highest marginal tax rate around here is ~46%.

But you're absolutely right about the high earners. Truth be told, you don't even have to be in the millions before people get tax advice and no high income earner is really paying what they could (should?) be anyway. It's the middle class that generally has no access to effective tax planning, both because it's incomprehensible to figure it out on your own, and cost prohibitive to pay a tax lawyer.
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Old 08-02-2009, 04:15 PM   #97
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Do you know how your rate compares to scandinavian countries? I'm interested to see it.
I'm pretty sure they are a good bit higher. At least they have world class social services in return. My comments earlier in the thread about 'the underclass' absolutely do not apply to Scandinavian countries. They are the only places in the world that I am aware of that seem to have made a success of the social democracy model. In Ireland and the UK we seem to have ended up with the worst of both worlds.

An Irish entrepeneur who has made good will probably want to splash out on a S class Merc and think of new ways of paying less tax, the Scandinavian equivalent might buy a Volvo and think of how he can improve the lot of those less fortunate. Of course, there are exceptions such as Bono.

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But you're absolutely right about the high earners. Truth be told, you don't even have to be in the millions before people get tax advice and no high income earner is really paying what they could (should?) be anyway. It's the middle class that generally has no access to effective tax planning, both because it's incomprehensible to figure it out on your own, and cost prohibitive to pay a tax lawyer.
True enough.
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Old 08-02-2009, 04:25 PM   #98
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Still, according to this:

http://www.revenue.ie/en/about/publi...statistics.pdf

...in 2006, the top 20% of gross income earners paid 78% of income tax.
The top 0.5% contributed a whopping 17.5% of the tax take.

(Table IDS1 p.6)

Food for thought for, perhaps, those on the left that want to screw the rich with higher and higher rates. Obviously there is a level at which those top 1% are motivated to engage in outright tax evasion if tax rates keep trending higher.
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Old 08-02-2009, 04:36 PM   #99
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i'm sure that if the tax rates in The Netherlands were 30% lower my gross salary would also have been 25% lower
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Old 08-02-2009, 07:41 PM   #100
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Food for thought for, perhaps, those on the left that want to screw the rich with higher and higher rates. Obviously there is a level at which those top 1% are motivated to engage in outright tax evasion if tax rates keep trending higher.
As you've pointed out, the top 1% pay very little tax one way or the other.

Either they get tax breaks and their 'capital' stays in the system supporting the economy in ways other than direct taxation

or

their money is removed from the system and invested offshore.

It has always been the middle class that has financed the government - which is tough to do when it keeps shrinking due to failed monetary policy, bailouts and other assorted bullshit.
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Old 08-02-2009, 07:49 PM   #101
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As you've pointed out, the top 1% pay very little tax one way or the other.

Either they get tax breaks and their 'capital' stays in the system supporting the economy in ways other than direct taxation

or

their money is removed from the system and invested offshore.

It has always been the middle class that has financed the government - which is tough to do when it keeps shrinking due to failed monetary policy, bailouts and other assorted bullshit.
Agreed on the middle class financing the government, but the point is, that table I linked to isn't necessarily showing that high earners are reneging on their responsibilites, e.g. the effective tax rate paid by the married couples with both earning with combined gross incomes over 275k is a very respectable 27%. This seems to imply that there is some tax avoidance going on, but not at such a level that they are paying derisory rates. Of course, these tables by definition only encompass declared income in Ireland, the income of, say, an Irish billionaire registered for tax offshore will not show up.
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Old 08-02-2009, 08:05 PM   #102
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Right, but the only way (under the current system) to keep more of a billionaire's money in Ireland is to allow him preferential tax treatment. It may drive the far left batty but it keeps more of the income in the 'declared' column so that at least the Irish benefit - not only from (proportionally small) taxes paid but from capital generating income in the economy perspective.
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Old 08-03-2009, 02:31 AM   #103
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I'm pretty sure they are a good bit higher. At least they have world class social services in return. My comments earlier in the thread about 'the underclass' absolutely do not apply to Scandinavian countries. They are the only places in the world that I am aware of that seem to have made a success of the social democracy model. In Ireland and the UK we seem to have ended up with the worst of both worlds.

An Irish entrepeneur who has made good will probably want to splash out on a S class Merc and think of new ways of paying less tax, the Scandinavian equivalent might buy a Volvo and think of how he can improve the lot of those less fortunate.
Interesting...why do you think that is?
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Old 08-03-2009, 02:08 PM   #104
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Interesting...why do you think that is?
Something I read years ago related the success of the welfare state to cultural homogeneity. The argument, as such, is that they don't work in multicultural societies, because of the presumption that the money of the "hard-working majority" goes to fund that of the "lazy minority," while in homogeneous cultures, it is seen as helping out one's neighbours.
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Old 08-03-2009, 02:27 PM   #105
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Something I read years ago related the success of the welfare state to cultural homogeneity. The argument, as such, is that they don't work in multicultural societies, because of the presumption that the money of the "hard-working majority" goes to fund that of the "lazy minority," while in homogeneous cultures, it is seen as helping out one's neighbours.


this was how it was explained to me by a Dane once. he was, firstly, a fairly brilliant economist, and he said that, by way of example, a small percentage of one's tax dollars goes to the Lutheran Church, since most Danes are Lutherans and it's essentially the state church. well, what happens if you're Muslim? does it seem normal and natural to pay taxes -- evil, evil taxes -- to subsidize the religious practice of your neighbors?

and it breaks down from there.
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