Comment by onlyrealcuzzo | Hacker News Reader

Comment by onlyrealcuzzo | Hacker News Reader

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So you slave away your younger years and pay ~40%+ income tax.

You manage to afford 2 children and own a nice house outright by the time you're 65. You have a nest egg large enough to afford a high quality life in retirement (mostly to pay your property taxes & income taxes & capital gains on inflation [not even REAL capital gains]...)

You die with $1M to your name plus a $1M estate (this is top ~6% or so).

Now you want to take away 50% of that before passing it on to the kids?

I mean, sure, why not?

But also, that probably brings your effective tax rate for your life to close to ~66%...

All while the people with 50% of the money (the top 1%) continue to have an effective tax rate of ~30% or less.

Like, how about we solve the problem where the people with the majority of the money have the lowest effective tax rate before increasing taxes on regular folk to make up for that??

I wouldn't be surprised if the average lower-middle class person already has a close to ~60% effective tax rate...

> Now you want to take away 50% of that before passing it on to the kids?

Yes, or spend it…

I’ve met too many people who are quite concerned about their parent’s wealth and spending later in life, and it seems to become more concerning for the kids once their parents become closer to death.

I believe, as a rule of thumb, dynastic wealth is bad for society at large and encourages a rise in rentiers and other parasitic behaviors.

> But also, that brings your effective tax rate for your life at close to ~66%…

Such an odd concept: the tax rate of all income you have had over the span of your life. Once you’re dead, you no longer ‘own’ anything. It belongs to your estate, and whoever owns that estate is the person who is taxed.

I can recognize that saving for the sake of saving is bad for the economy, I don't like to pretend that the only solution is for one entity (the government) to get it, and it doesnt have to be that way

if the balances were programmed to be slashed - a portion automatically deleted for inactivity - I would be more into that. note that this is an upgrade from what the Federal Reserve already tries to do in tightening phases like now. This is also what some monetary experiments do to validating nodes.

So don't save up $2 million for inheritance... No one is forcing you to do that.

Not to mention the increased taxes will be paid back, at least to some extent, in enhanced services. Maybe your kids could get a free education and free healthcare instead of $1M each in inheritance.

Or instead of increased services, we could tax other things less such as the income of living people. I'd much rather have dead people, who have zero use for the money getting taxed more and living people, who actually can make use of the money getting taxed less.

Encouraging people to frivolously spend on luxury instead of saving is a terrible idea.

You just described the entire economy. It's worked out pretty well actually. All spending is someone else's income, which can then be taxed again.

By spending on luxury such as expensive restaurants and hotels, you cause the economy to allocate talent and capital toward the production of those luxury goods and services, rather than toward longer term investment. Making it so that old people burn up their built-up wealth in that way is not good. It would be much better to gather the equivalent amount of tax elsewhere, if you insist that we must do so (such as with a VAT on luxury goods and services!).

Encouraging rich people to spend, and using that money to better support poor and working class people is a great idea.

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