You May Be Paying a Higher Tax Rate Than a Billionaire | Hacker News Reader

You May Be Paying a Higher Tax Rate Than a Billionaire

propublica.org

Forget higher rate, I may have paid more federal income taxes than billionaires in several years as according to this article some manage to pay zero dollars:

IRS records reveal how the wealthiest avoid income tax - https://www.propublica.org/article/the-secret-irs-files-trov...

This is not always a surprise...since we tax based on income and not net worth. Most billionaires are wealthy because they own significant amounts of stock...so unless someone like Bezos sells a significant amount of stock and it's then income they won't pay taxes on it. The same way we don't tax people's house value every year even though their net worth has likely increased year over year.

Oh, and with some proposed taxes on net worth that would force someone like Bezos or Musk to sell their company stock and potentially lose controlling interest in his company. It also means a lot of work and random assessments of property...which is not a perfect science (even worse than calculating income and taxes).

The second sentence in the article:

“But even if you use the most conventional yardstick — income — the wealthiest still pay low rates.”

"That’s lower than the rate a single worker making $45,000 a year might pay if you include Medicare and Social Security taxes."

Not quite saying the same thing. Comparing capital gains taxes to regular incoming taxes plus medicare and social security. Hell let's just throw property taxes, gas taxes, sales taxes and every other tax in there and then compare...

They're completely different taxes that are taxing money used for the same purpose. To put it another way, for the very wealthy, capital gains is their "income" (in a colloquial sense). They gain a tax advantage by making their money through a different route. One that is unavailable to most (at least in sufficient quantities to live on).

> Hell let's just throw property taxes, gas taxes, sales taxes and every other tax in there and then compare...

There's not much point. They're discussing rates, not absolute amounts. Those are all fixed-rate, so they're the same for everyone (maybe not property taxes in all jurisdictions? I'm not sure). Gas taxes do apply; electric cars pay no or reduced gas tax. The same discussion has been brought up, since gas taxes pay for highway maintenance.

I sure do. Here in France, as a software engineer paid 2.5 times the minimum wage, I receive 48.5% of what I cost my employer. And even though I manage to negociate a raise every year or two, the taxes increase rate is higher.

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