taxation

[TheMercenary]

And here is why it is never going to happen....

The Obama/Buffett ruse arises just like any other magician’s trick. It focuses attention on just one tax rate paid on income arising from capital investment – the capital gains tax rate of 15%. The florid abusive rhetoric distracts from the multiple taxation of capital investment income, which is actually taxed at least four separate times under our tax code. Capital investment income is taxed first by the above mentioned, abusive, internationally uncompetitive corporate income tax. If any is paid out as dividends, then it is taxed again by the individual income tax. If the value of the capital interest, say a share of stock, manages to increase in the Obama depression, then it is taxed again by the capital gains tax. If anything is left at death, then it is subject to taxation again by the death tax.

That is how the top 1% of income earners ends up paying more than the bottom 95% combined. And it is why the average tax rate paid by millionaires is three times the average rate paid by the middle class.

On the basis of his abusively misleading rhetoric, Obama in his campaign speech on Monday called for $1.5 trillion in increased taxes. That would be on top of all the tax increases for which Obama has already won enactment under current law for 2013. In that year, the tax increases of Obamacare become effective, and the Bush tax cuts expire, which Obama has refused to renew for the nation’s small businesses, job creators, and investors.

As a result, the top two income tax rates will go up by nearly 20%. The capital gains tax would soar by nearly 60%. The tax on dividends would nearly triple. The Medicare payroll tax would rocket up by 62% for these disfavored taxpayers. That is all on top of virtually the highest corporate tax rates in the industrialized world, and before the new tax increases President Obama called for on Monday.

President Obama said in his campaign speech on Monday that Congress should pass his jobs plan “knowing that every proposal is fully paid for,” supposedly by that $1.5 trillion tax increase. But the President’s proposed tax increases don’t have a prayer of raising nearly that much.

Obama and Buffett are blowing so much smoke over the 15% rate on capital gains and on dividends adopted in the Bush years. But over the last 40 years, every time the capital gains tax rate has been cut, revenue has gone up. And every time the capital gains tax rate has been raised, revenue has gone down.

The reason for this is that when the capital gains rate was cut, more taxpayers sold their capital and realized their gains, and a rising stock market produced more gains. When the rate was increased, more taxpayers held on to their capital and a declining stock market cut off the gains.

All of those tax increases are to finance a so-called jobs plan which is really just a federal bailout of spendthrift states. About half of the $450 billion in increased federal spending under the plan goes to states to keep full employment of “teachers, policemen, and firefighters,” and for “infrastructure that states have already decided they don’t need or have deemed a low priority,” as AEI Executive Committee member Henry Golub rightly explained it in the Wall Street Journal yesterday. This after half the infrastructure spending in the first, 2009 stimulus bill has not been spent yet.

If you believe President Zero you are being duped....

http://www.forbes.com/sites/peterfer...x-fallacies/2/