Limited Gains from Taxing the Rich

[disgruntledcitizen]

That ain't the bracket we're talking about though is it

last time i checked 110K was in the 100 - 200K bracket

[Garland Names the Planets]

last time i checked 110K was in the 100 - 200K bracket

And so how much of your income would be affected? I'd imagine this year it would be veering towards the lower end of your typical annual income range

[disgruntledcitizen]

And so how much of your income would be affected? I'd imagine this year it would be veering towards the lower end of your typical annual income range

ironically enough this has been one of the better years so far, my job is not related to the irish market though i'm based here so i've not been effected adversely apart from the income levies, etc that we've all been hit with, however the point was not meant to be personal and more a reflection of people in the bracket you refer to being easily mobile, we're no more so than people in the lower brackets to be honest.

[ivnryn]

I ran the calculations using this report (using the table on page 6). This is based on 2008 stats.

It assumes that everyone above the cutoff gets hit with an additional 10% marginal rate.

It gives roughly the same answer as the other site. Hitting everyone on 200k with a 10% tax would only take in 560 million at most (and that assumes that it doesn't cause evasion or avoidance).

Cutoff	Extra tax (Billions)
0	8.15
10000	6.14
12000	5.79
15000	5.29
17000	4.98
20000	4.56
25000	3.93
27000	3.72
30000	3.42
35000	2.99
40000	2.64
50000	2.1
60000	1.72
75000	1.35
100000	1
150000	0.7
200000	0.56
275000	0.44

It also represents the cost for a reduction. A 10% cut in the top band would cost the country around EUR 3.5 billion (again assume that it doesn't reduce evasion or avoidance).

A 25% flat tax with no cutoff whatsoever would take in 20.4 billion which is around double current income tax.

A 14% flat tax would give the same total income as the current progressive system.

[hiding behind a poster]

A 4% wealth tax on the country's 33,000 millionaires would yield more than Brutal Brian wants to hack out of the economy.

Really? Let's see your figures, then.

[ivnryn]

Really? Let's see your figures, then.

Taxing wealth at near the nominal interest rate effectively means nationalising that wealth.

For example, if you have a business that earns 100k per year, then the business is worth around 20 times that, so 2 million. A 4% wealth tax on your business would mean that the government gets 80k per year from you because you own the business.

Thus, they effectively take 80% of your profits (and so de facto own 80% of the business).

[politicaldonations]

Typical - please, please, please don't tax the rich - otherwise they will all leave us and they will put that factory in the suitcase with them.

I hope they're not flying Ryanair - the luggage allowance will kill them.

A 4% wealth tax on the country's 33,000 millionaires would yield more than Brutal Brian wants to hack out of the economy.

Any of them that want to leave I would tell them don't let the door hit you on the a*se on the way out - and - we'll be sequestering your assets and freezing you bank accounts.

So 4% wealth tax on the "millionaires" and how much on your average PS couple with assets of 500k? Who would calculate the wealth? How much would that cost to calculate? Would they have to pay the 4% every year? If every year then why would many stay here when they lose 4% of wealth before they even try to make a return on their investments? Are these millionaires also incuding old people with valuable homes but little cash or income? Would foreign executive working in Ireland for foreign MNCs creating loads of jobs and economic activity pay it? How would a foreign executive or business man feel about coming to live work and invest here if he faced a 4% wealth tax from the get go? If a person loses wealth in a year can they claim back previous years wealth tax?

Isnt that 33,000 millioanires stat from a wwealth report in 2006? Isnt it likely that theres far less millionaires now? My father worked all his life in PS and finished last year earning 65k final salary, his modest home in dublin costs around 400k now after being worth 800k at top market, he had his PS pension valued at over 1.5million, would he and my mother pay the wealth tax?

[hiding behind a poster]

Taxing wealth at near the nominal interest rate effectively means nationalising that wealth.

For example, if you have a business that earns 100k per year, then the business is worth around 20 times that, so 2 million. A 4% wealth tax on your business would mean that the government gets 80k per year from you because you own the business.

Thus, they effectively take 80% of your profits (and so de facto own 80% of the business).

Wow. Way to encourage people to set up businesses - NOT.

[Dreaded_Estate]

Typical - please, please, please don't tax the rich - otherwise they will all leave us and they will put that factory in the suitcase with them.

I hope they're not flying Ryanair - the luggage allowance will kill them.

A 4% wealth tax on the country's 33,000 millionaires would yield more than Brutal Brian wants to hack out of the economy.

Any of them that want to leave I would tell them don't let the door hit you on the a*se on the way out - and - we'll be sequestering your assets and freezing you bank accounts.

France has a wealth tax of up to 1.8% and has 500,000 millionaires.
It raised by €4.5bn from this tax in 2007.

There is now way we would generate anything more than €1.5bn with a similar measure here.

[factual]

Perhaps it would be a good idea to harmonise tax rates across the EU to stop companies and rich people reloacating playing one country off against another?