House Democrat's New Tax Plan Could Provide $2.9T in New Revenue – The Mountain | Hacker News Reader

House Democrat's New Tax Plan Could Provide $2.9T in New Revenue – The Mountain

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> Increasing the corporate tax rate will provide revenues that could help feed, clothe, and house some of America’s most vulnerable people

How will increasing corporate taxes deregulate the twin tapeworms of NIMBY housing policy and a completely captured health care sector?

Because all tax increases will do is use the poor as a conduit to feed these two sectors.

Don't be so cynical. you are supposed to just assume the best intentions and then not think about the details too much

LOL

Read another way - new tax plan could remove $2.9T from law abiding citizens and put it in the pockets of beurocrats, politicians and lobbyists.

So they’ve completely abandoned restoring SALT deductions now? What a win for republicans, penalizing high tax blue states.

Though many democrats did want to re-enact an overtly regressive tax break, perhaps some realized that it went completely against their stated principles.

Restoring SALT deductions mostly helps the wealthy since you can deduct up to $10,000.

Democrats don’t want to burn political capital trying to secure a win for the rich.

I often see this said but you can do some quick math to see it affects more than wealthy people. A median single-family home in CA is now $800k, so the property tax on that would almost be enough to hit the $10k. And that’s before any other state or local taxes like income tax.

I actually don’t support reinstating the SALT tax deduction but the discussion of it seems off.

If you recently bought an $800,000 home you're quite wealthy compared to the median American.

>If you recently bought an $800,000 home you're quite wealthy compared to the median American.

I was in Oakland a couple years back and saw a house for $600k - just looking at it made me want a Tetnis shot. I don't envy Californians for their $800k houses

the median american is not paying california taxes, house prices, schools costs etc

If you're willing to say "this deduction only helps wealthy Californians but I define 'wealthy' as people buying median-priced (and lower) homes" than I'll get on board with that statement. I don't think it's a super ambitious or useful one though.

> Restoring SALT deductions mostly helps the wealthy since you can deduct up to $10,000.

It helps folks in higher cost / higher tax areas. It's not really a rich/poor thing.

That was one thing I always chuckled about with respect to the Trump tax cuts and the removal of SALT. They really screwed folks in suburban New Jersey, Long Island, and California. And it was exactly those seats that Republicans lost and which cost them the house in 2018.

There is no moral reason that state taxes should be deducted from federal taxes.

For perspective, current federal, state and local tax burden is $6.91 trillion.

I am very thankful that finally somebody is doing something about the economic anarchy this country has suffered for so long. Given that there is so much theoretic and historical precedent that the best way to organize an economy is by looping as much money as possible through the political capital of the country.

What I don't quite understand is why don't they just print a few more trillions?

Your comment makes no sense outside of superficial Marxism, but I'll comment on one line:

> What I don't quite understand is why don't they just print a few more trillions?

To a certain point, as the USD is the global currency, we can do that. (And we did during the corona pandemic.)

After that point, printing money causes people to lose confidence (since it's just paper, and not money) and find another currency. Then you can't print any more without causing the currency to devalue.

This would be very bad for 2 reasons:

1) As the global currency, the US benefits by about 1% to our economy. You could argue this pays for our military expenditures.

2) We would have to make debt payments to support the currency. After a certain point, that becomes impossible.

FYI: the CCP is trying to replace the USD, and will exploit weaknesses in how we manage the USD.

Maybe you're young, but I can remember 20% inflation/stagflation back in the day. It was a very uncomfortable feeling for people to lose control of the value of their savings and prices for imports. You want to avoid that at almost any effort.

Pundits for decades have said that the fundamental weakness of democracy is that voters can vote themselves free money. This is what the Biden administration is actually doing now.

I'm pretty sure he's joking

I have already lived through a decade of (hyper)inflation in a different country. At the time the grassroots solution was to establish a shadow economy based on USD. I find it very interesting, in Chinese proverb kind of way, to see how the world will manage the destabilization of the USD that is already underway.

>What I don't quite understand is why don't they just print a few more trillions?

Despite the ever frequent refrain of "governments aren't households, they can't default on debt,they can always print, the debt doesn't matter", the question you asked is the entire logical argument for proving this isn't the case. if they could do it, they would do it. The truth is there are a vast number of interrelated reasons that mean while although it is technically possible, in a majority of circumstances it is not on the table as people rightfully worry about a huge number of potential consequences some of which are obvious to casual observers and many of which are not.

> the economic anarchy this country has suffered for so long

Free markets are a chaotic system, that's for sure. But it made the US the wealthiest country in the world, and hundreds of thousands of poor people tramp thousands of miles for just a chance to be part of it.

> historical precedent that the best way to organize an economy is by

letting it run itself. It doesn't need to be organized, as free markets are self-organizing.

I’m unfamiliar with this publication. Is this article automatically generated? The simple, nunber-oriented language sans analysis, interspersed with random opinion sentences reminds me of AI-written sports game summary blurbs.

Fat chance. Joe Manchin and other corporate puppets will not vote for this.

> The plan would increase the top tax rate on Americans earning over $435,000 from 37 percent to 39.6 percent.

Democrats have caviar dreams and a tuna fish budget. $2.9 trillion over 10 years doesn’t even cover the FY 2015 budget deficit projected forward, much less any new spending.

Biden’s promise not to raise taxes on upper middle class people (making $100k-400k) is nuts. Half of all personal income, over $5 trillion, is earned by the top 25% that’s not the top 1%: https://taxfoundation.org/summary-of-the-latest-federal-inco....

Other countries heavily tax this group. In Germany, the 42% income tax rate (just a couple of notches below the 45% max) kicks in at 56,000 euros. In Sweden and Denmark, the top income tax rates kick in around 1.5x the median income (well under six figures for us).

It should not be this hard to tax all the SV and Wall Street-adjacent upper middle class people. Most are even Democrats now. They voted for higher taxes. Just do it!

> In Germany, the 42% income tax rate (just a couple of notches below the 45% max) kicks in at 56,000 euros.

But they don't have additional state tax (+12% in California), right?

and they also dont owe an arm and a foot everytime they go to hospital

Anyone who makes $100k+ in US, has health insurance with a few thousand dollars annual maximum out of pocket.

More importantly, while in the US, healthcare insurance is typically a benefit offered on top of the cash salary, in Germany, health care tax is deducted from the salary. So, if you’re American household making $100k, you’ll spend $3k on Medicare tax, and then you’ll spend up to your out of pocket max, typically less than $5k/year (and you’ll hit the max only in years in which you heavily use healthcare). In contrast, if you’re German making 100k EUR, you’ll be paying 8k EUR healthcare tax every single year.

No, but you won’t hit a 42% marginal rate in CA until you make over $207,000 as an individual.

No, but it is much easier for a US citizen to move from California to a state with no income tax than it is for a German citizen to emigrate.

When you factor in state taxes + all the things the US government doesn’t do for me (particularly us upper middle class folks), my effective tax rate is pretty on par with Germany.

As someone who came from a country with similar tax rates as Germany that’s a no from me dog.

If you think this, you probably haven't accounted for the astronomically higher costs of education, and healthcare in the United States. You also probably haven't done a full accounting of the taxes you actually pay in the United States (You need to include your employer's portion of Social Security and Medicare, which is another ~10% of your income.)

Your tax rate starts looking a lot worse, and you end up getting a lot less when you add all this up.

On the bright side, your money is paying for corn subsidies in Iowa, and 9 aircraft carrier strike groups.

Oh I've most certainly accounted for it. Paying for healthcare and education isn't that hard when you get to keep another 10-20% of your income each year.

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