Capital gains tax

[Wilson23]

Why is it separate? Why not simply tax capital gains AS INCOME?

 

[AnnieLit]

Read it as capital gains sex. Re-read - still sex

As for you question, it is separate because some years you can have capital losses, not gains. A loss can be rolled over to the next year (or three, if your loss in year 1 is bigger than your gain in year 2 and you still have some leftover.) This way it smoothes things out for long term investments, but you are still paying taxes on the rest of your income.

 

[DanOkeffie]

Why is it separate? Why not simply tax capital gains AS INCOME?

You're pretty dumb

 

[SimonDoom]

Capital gains are taxed as income, but at a lower rate. The reason behind the lower rate is to incentivize people to invest in business enterprises.

 

[colddiesel]

In many Nations/jurisdictions some income streams are highly variable from year to year. In those cases those occupations are allowed to equalize their income for say 5 year periods rather than annually. Farmers are the occupation most commonly allowed to do this in many countries.Timing is the difference and rationale.

 

[Wilson23]

Capital gains are taxed as income, but at a lower rate. The reason behind the lower rate is to incentivize people to invest in business enterprises.

Ever since the 1980s, it should be obvious THAT is not sound thinking.

 

[SimonDoom]

Ever since the 1980s, it should be obvious THAT is not sound thinking.

Why is that so?

 

[Wilson23]

Why is that so?

Because supply-side or trickle-down economics is now more thoroughly discredited than Marxism. It has been tried in many countries for long periods, and it NEVER accomplishes anything but its REAL intended goal, which is to make the rich richer. And I need hardly add that is NOT a legitimate goal of public policy.

 

[SimonDoom]

Because supply-side or trickle-down economics is now more thoroughly discredited than Marxism. It has been tried in many countries for long periods, and it NEVER accomplishes anything but its REAL intended goal, which is to make the rich richer. And I need hardly add that is NOT a legitimate goal of public policy.

You and I completely disagree about this. First, I disagree about the equation about supply side economics and trickle down economics. I support the former but not the latter.

Supply side economics is based on the concept of Say's Law: Supply creates demand. If an economy supplies more stuff, then the stuff, once it's in the hands of consumers, will create more demand.

I think this is obviously correct. It's the recipe that every successful economy has ever followed.

You're wrong about it making only the rich richer. History shows you wrong. It makes everybody richer. In 1900, after a 100-year experiment with more or less laissez faire economics, the United States had achieved a higher standard of living for the average person than any country ever. Hong Kong beat mainland China. West German beat East Germany. South Korea beat North Korea. Capitalism wins every single time.

There are no examples, ever, of true socialism working, in the sense of providing a standard of living for the average person comparable to what capitalistic, market-based economies provide. Ever. None.

I think it's fair and accurate to say that if an economic system protects private property rights and economic freedom and incentivizes people to create wealth, it will always succeed, and if it doesn't do these things, it will always fail. So, I'm not sure what your criteria are for "discredited."

 

[Wilson23]

You're wrong about it making only the rich richer. History shows you wrong. It makes everybody richer. In 1900

Nothing before 1980 is relevant here. Supply-side was a NEW thing then, not just a holdover of pre-Keynesian laissez-faire.

 

[Wilson23]

I think it's fair and accurate to say that if an economic system protects private property rights and economic freedom and incentivizes people to create wealth, it will always succeed, and if it doesn't do these things, it will always fail. So, I'm not sure what your criteria are for "discredited."

It is decredited because the best economic system is not the one with the most millionaires or the biggest GDP. The best economic system is the one where NOBODY is POOR. In making economic policy, there is ONLY ONE legitimate goal: BROADLY SHARED prosperity. That is a self-evident truth in the Jeffersonian sense.

 

[SimonDoom]

Nothing before 1980 is relevant here. Supply-side was a NEW thing then, not just a holdover of pre-Keynesian laissez-faire.

No, it wasn't new. Supply side economics wasn't invented by Arthur Laffer. He supported it, and his famous "curve" was based (sort of) on its principles, and he achieved some popularity among conservatives around the time Reagan was elected in 1980, but he didn't invent it.

Supply side economics traces back to the writings of Jean Baptist Say in the early 1800s. His theme was that supply creates demand. Keynes, in the 20th century, took the opposite view. He believed demand drove the economy.

I agree with Say. I think both logic and history show him to be right. Institute policies that encourage supply, and economic growth will follow.

 

[siobhancan99]

Why is it separate? Why not simply tax capital gains AS INCOME?

They are taxed as income. That's why they're part of the income tax.

You should probably learn about the things you want to complain about. Do you mean "why do they have a potentially preferential rate?"

Short term capital gains are taxed as "ordinary income" which you seem to have conflated with income. Long term capital gains (which you seem to think all capital gains are) have a preferential tax rate. That does not mean they are not taxed "as income" it means they have a lower tax rate than other kinds of income.

There are a number of public policy reasons for it outside of "trickle down economics." In part, long term capital gains are taxed at a preferential rate because some portion of capital gains are due to inflation. Another consideration is avoiding "lock in" where people don't dispose of long term assets because they can't currently afford the taxes, and so on.

The wisdom of these policies is debatable, by those who understand the basics. I.e... not you.

 

[Wilson23]

Starting in the Bush I Admin there were demands to ABOLISH this tax -- but that would not mean taxing capital gains as present income, it would make them tax-free entirely.

Does anybody still think THAT is a good idea?

 

[justawnnabewriter]

Why is it separate? Why not simply tax capital gains AS INCOME?

Is this a serious question

 

[justawnnabewriter]

Starting in the Bush I Admin there were demands to ABOLISH this tax -- but that would not mean taxing capital gains as present income, it would make them tax-free entirely.

Does anybody still think THAT is a good idea?

Tax free would be AWESOME

 

[Wilson23]

Tax free would be AWESOME

Not for anyone but the investor.

 

[justawnnabewriter]

Not for anyone but the investor.

As it should be

 

[Wilson23]

As it should be

Don't even think of arguing this issue from a "taxation is theft" perspective.

 

[justawnnabewriter]

Glad that you agree that taxation is theft

 

[Wilson23]

Glad that you agree that taxation is theft

Only idiots and Libertarians ever say that.

 

[RoryN]

You're pretty dumb

^^^

justawnnabewriter alt.​

 

[justawnnabewriter]

Only idiots and Libertarians ever say that.

well you are an idiot

 

[justawnnabewriter]

It is decredited because the best economic system is not the one with the most millionaires or the biggest GDP. The best economic system is the one where NOBODY is POOR. In making economic policy, there is ONLY ONE legitimate goal: BROADLY SHARED prosperity. That is a self-evident truth in the Jeffersonian sense.

barf, dude why do you live in America? Move to another country