Bill Gate's Solution to Income Inequality

[Heywood]

What do you guys and gals think about a consumption tax instead of an income tax?

http://fortune.com/2014/10/15/bill-gates...nequality/

Under such a tax, people would report not only their income but also their annual savings, as many already do under 401(k) plans and other retirement accounts. A family’s annual consumption is simply the difference between its income and its annual savings. That amount, minus a standard deduction—say, $30,000 for a family of four—would be the family’s taxable consumption. Rates would start low, like 10 percent. A family that earned $50,000 and saved $5,000 would thus have taxable consumption of $15,000.

Consider a family that spends $10 million a year and is deciding whether to add a $2 million wing to its mansion. If the top marginal tax rate on consumption were 100 percent, the project would cost $4 million. The additional tax payment would reduce the federal deficit by $2 million. Alternatively, the family could scale back, building only a $1 million addition. Then it would pay $1 million in additional tax and could deposit $2 million in savings. The federal deficit would fall by $1 million, and the additional savings would stimulate investment, promoting growth. Either way, the nation would come out ahead with no real sacrifice required of the wealthy family, because when all build larger houses, the result is merely to redefine what constitutes acceptable housing. With a consumption tax in place, most neighbors would also scale back the new wings on their mansions.

[Minimalist]

More bullshit from the Upper 1%

Consumption tax is a tax on any money spent on goods or services. The basic formula is to take your yearly income and subtract your saving and investments.

Cons: Well, the problem is that, while in absolute dollars the consumption tax hits the wealthy more, in relative terms it will swallow every cent of the poor's money. Why? Because the poorest Americans save nothing on average, being forced to spend every cent they make to survive. It's this fact that keeps them from having to pay taxes, and this fact that would make a consumption tax on them equal to 100% of their income.

Fuck you, Woodie. Go back to sucking Koch Kock.

[vorlon13]

The 2 million dollar mansion cited as an example, could be built in another country.

[Chad32]

More bullshit from the Upper 1%

Consumption tax is a tax on any money spent on goods or services. The basic formula is to take your yearly income and subtract your saving and investments.

Cons: Well, the problem is that, while in absolute dollars the consumption tax hits the wealthy more, in relative terms it will swallow every cent of the poor's money. Why? Because the poorest Americans save nothing on average, being forced to spend every cent they make to survive. It's this fact that keeps them from having to pay taxes, and this fact that would make a consumption tax on them equal to 100% of their income.

Fuck you, Woodie. Go back to sucking Koch Kock.

I caught on to that too. Poor people don't save much, if anything. They can't. So they use almost all, or all, their money to consume.

[Heywood]

More bullshit from the Upper 1%

Cons: Well, the problem is that, while in absolute dollars the consumption tax hits the wealthy more, in relative terms it will swallow every cent of the poor's money. Why? Because the poorest Americans save nothing on average, being forced to spend every cent they make to survive. It's this fact that keeps them from having to pay taxes, and this fact that would make a consumption tax on them equal to 100% of their income.

Fuck you, Woodie. Go back to sucking Koch Kock.

I'm not espousing a consumption tax dummy. I am learning about it and asking people what they think about it. I'm looking for the opinions from people with IQ's above their shoe size....you're not in that category.

Christmas is coming up...perhaps you should spend your time putting decorations on your dunce hat and let the intelligent people talk.

[Whateverist]

Yeah this wouldn't help with income inequality. It would just further exploit those who have and make less. They can't afford to save. They're living paycheck to paycheck, just barely scraping by. To reward those who can afford to save more just widens the gap, a fact that I can't believe escaped Gates' notice.

[Heywood]

The 2 million dollar mansion cited as an example, could be built in another country.

They would still be taxed on it. Consumption is defined as income minus savings.

If a family made 10 million dollars and saved 2 million dollars, they get taxed on 8 million dollars regardless of where they spent it.

[TheRealJoeFish]

More bullshit from the Upper 1%




Fuck you, Woodie. Go back to sucking Koch Kock.

I caught on to that too. Poor people don't save much, if anything. They can't. So they use almost all, or all, their money to consume.

Wouldn't, say, a deduction of approx. $20,000 + $10,000 per household member take care of that?

If you're talking about disproportionately harming the middle class, that's different, and probably true, although I haven't really thought about it

[Heywood]

More bullshit from the Upper 1%




Fuck you, Woodie. Go back to sucking Koch Kock.

I caught on to that too. Poor people don't save much, if anything. They can't. So they use almost all, or all, their money to consume.

If the exemption is greater than their income....the poor pay no tax whatsoever. Poor people would be hit disproportionately by say a national sales tax....but this isn't that.

---

Yeah this wouldn't help with income inequality. It would just further exploit those who have and make less. They can't afford to save. They're living paycheck to paycheck, just barely scraping by. To reward those who can afford to save more just widens the gap, a fact that I can't believe escaped Gates' notice.

Gates takes the position that income inequality isn't what we should be concerning ourselves with.





I agree with him. I have often said we should be looking at inequality in standard of living(what he calls consumption inequality) and inequality in income really doesn't tell us anything.

[Whateverist]

Oh I can understand why he would say we shouldn't be concerned with it. I'll bet he'd like that. What I don't understand is why so many peons like you support the 1%. Hoping to get a couple of choice morsels from the table?