President Obama forces GM boss Rick Wagoner to step down

The question had nothing to do with GDP. How does GDP explain why the risk taken by investors justifies a lower capital gains tax. Why does risk need a tax break? Why isn't the risk a businessman takes worthy of this break? Salaried people can lose a job and be left with nothing, what of that risk?

It is a straightforward fact, sir. W-2 earners can pay tax rates up to 39.5% on the bulk of their income, a significantly larger burden than full-time investors with their 15% capital gains tax on the bulk of their income.

Unless you can show a correlation supporting this, yes. I just showed 2001 and 2003 tax cuts producing different results, that is not a trend.

Exactly. This is why I think there is a clear and direct correlation between the economy and revenue and it can be proven historically by the graph. You have not yet demonstrated a direct correlation between revenue growth and tax cuts. It's an unsound conclusion based on a sample size of one.

 

Well, so what? The principle they have already paid taxes on is never taxed again. Only the income that they make off of them. Income is income.

 

Perhaps. I'm not a tax expert but in general I think that there should be a better balance point for taxing different forms of income.

 

Indeed it does, but I simply do not think this incentive is needed or is sustainable given our debt.

Now, this is a line of logic that I might be able to endorse, if that 15% figure was demonstrated to be a justifiable balance point using a proper inflation index. But I think it was just arbitrarily arrived at.

I didn't say that you would pay less taxes if capital gains were taxed higher. I said that people who earn most of their income from capital gains pay less taxes (as a percentage of their income) than those who earn most of their income from salary or a business profit. Thus, those that earn their incomes by working carry a higher tax burden than those whose investments earn their incomes.

But that involves regular income taxes, not capital gains taxes. Be aware that I'm advocating balance here. Using your income tax model, I would agree that the Kennedy and Reagan tax cuts that reduced the top rate from 91% to 39.5% was a move to a better balance point. But I disagree that this means that dropping taxes below that balance point would keep offering benefits. There does comes a point where diminishing returns are outweighed by income loss. 15% is below the average tax rate paid by most people and I suggest that it is too low.

A far better capital gains argument, but how does it help determine the optimum rate?

 

We fill out one tax form to one government. Income is income. I have about five income streams, but only capital gains get the big break.

And when a bull market returns?

 

Of course, when the Republican's picked and chose beneficial tax breaks for the wealthy . . . you didn't seem to mind. You're so blindly partisan that you can't help yourself.