Basically if you're paying close to the "full amount" of your tax rate in say the $5 million dollar range, then no disclosure required. If you're substantially under that your deductions should be public.
Which isn't to say that they shouldn't pay more in income taxes. It's just to say that it's important to identify the real problem and address it directly, and to realize when you're not going to be happy with a solution beforehand.
I can only speculate, but I wonder if the reason a lot of people shout "tax the rich" isn't that they want a bit more resources for geniunely deserving causes, but that they hate uber successful people and just want to see them "cut down to size".
In this view, higher taxes aren't meant to bring in more revenue (Laffer curves place limits on the effectiveness of higher taxes), but to hurt Rich people. Bring them down so we don't see some people doing 100,000 times better than the average person.
Maybe they think hurting Rich people will make the world a better place? Maybe they just wanna hurt them because they feel jealous? I'm super curious about what the true motives are.
Why are people so unhappy to see the existence of centinares and billionares?
I'm especially talking about people who made their money by creating new things, or made the world more efficient in some way.
The simple fact is that people want their lives and their loved ones' lives to be comfortable, happy, and secure. If they believe they are being denied that, they become unhappy.
At the end of the day, money, markets, taxes, wealth, etc. are just tools for creating happy societies. Nobody (to first-order approximation) wakes up thinking "tax the rich" merely because they're jealous they don't have a private jet. Certainly nobody wakes up deciding we need to upend the entire system of government merely because they see other people being happier than them. They do these things because they see the juxtaposition of others' obscene wealth side-by-side with the fact that they themselves e.g. can't even afford the basic necessities, or don't see security in their future, etc. At that point, they think: "if you're going to support a system that makes some of us miserable, it's only fair that you feel it too."
Obviously, the solution in this case isn't to make everyone be miserable. It's to help everyone be happy.
The problem I see we have right now is that people focus solely on the mechanism (taxing income) while forgetting the goal. Or they focus on the current state, while missing the trajectory. Taxing income more steeply could be one component of the mechanism for creating a happy society, but it's neither sufficient (it's quite possible to do that and still have everyone have worse lives...), nor necessary (there are lots of other ways to generate revenue too).
To give just one extremely vivid example that hopefully puts into perspective just how insufficient (and pointless) taxing the rich can be if it is done carelessly:
America's top 20 billionaires have some ~$3T in wealth. Tax the rich, right? OK, let's say the government somehow just seized all their money.
What would happen next? It's not exactly rocket science.
Spoiler: America's national debt would decrease from $36T to $33T. Which is like turning the clock back to... 2024? or 2023 at best?
Exactly what problems would turning the economy back 1 year solve?
It would not be discriminatory to say "we're going to publicize the returns of anyone who commits tax fraud". It would be discriminator to publicize the returns of anyone the Marxist hive mind thinks should pay more taxes than they are legally required to.
If the rich commit tax fraud, put them in jail. If they don't "pay their fair share of taxes" but don't commit any crime in so doing, be mad at the people who wrote the tax code.
To be honest, I have no special qualms with businesses doing their level best to minimize their tax obligations, provided they invest in their workers and/or R&D. Its just that they don't. The whole point of the old-timey ridiculously high highest marginal rate was to induce companies to do literally anything else than just pay their top executives more. Higher wages for the rank and file, investment in facilities, R&D, charitable giving, etc etc etc all have far greater impacts on society than the equivalent quantity shipped to the fed as taxes. If the ultra-rich want to avoid paying taxes by instead donating large sums of money to charities with broad socioeconomic impact, I have no problem with that either, for the same reason.
The issue is not that the ultra-rich don't pay their "fair share" (whatever that means), its that the tide that raises their ships does not raise all ships equivalently, and the ways they avoid paying that "fair share" disproportionately benefits only them. I don't really benefit if Jeff Bezos donates a lot of money to Jeff Bezos' nonprofit to manage his art collection or whatever. I do benefit if he just paid an equivalent amount into the general tax fund (or donated it to the March of Dimes or something).
I regularly pay out 20% of my annual income in the form of taxes. Its hard to be super sympathetic to e.g. Elon "I paid $11 billion in taxes last year!" Musk, when most years he pays far far less than that, and his net worth (as figured by his borrowing potential) grows proportionally a lot faster than mine does.
Questionable. Tax receipts that get spent on roads, bridges, other infrastructure that over time increase your and everyone's standard of living? Sure. Funding of boondoggles and sinecures for political allies? Not at all.
> his net worth (as figured by his borrowing potential) grows proportionally a lot faster than mine does
You were talking about income tax, so net worth shouldn't matter, right? And I think you're alluding to the fact that the ultra-wealthy can often temporarily avoid capital gains tax by borrowing against their stock holdings instead for their income; I don't think this matters that much in the end, because it's all taxed anyway. Interest paid to the lender is income to that lender which is taxed, and eventually the bill comes due, at which point shares will have to be sold and capital gains taxes incurred.
Stepped up basis is one good Google search to explain one way.
Having said that, upon, say, Elon Musk's passing, his estate would still owe billions of dollars in tax.
It would be entirely reasonable to put a cap in there if we are concerned about it hurting the middle class and wanted to just be a tax benefit.
The whole idea is that capital gains taxes are lower than income taxes because it comes from something that was already taxed, but that isn’t even true a lot of the time either. As Warren Buffett always says his overall tax bill is still lower than his secretary’s.
It’s not even just the idea that progressive taxes are better, it’s that this is a regressive tax system. One more accurately, and uneven one because two people who make the same money could end up paying very different tax bills throughout their life.
The comment to which I was responding was suggesting some mechanism other than the tax code to determine “the full amount”. What is that and why isn’t that just the tax code?
It’s because they’re just determining “the full amount” to be something that makes them feel a certain way which isn’t really a sound basis for law. The full amount is whatever the tax code legally obligates one to pay, no more, and to suggest we should expose people’s private data simply because we don’t like the tax code is preposterous.
I feel this doesn't happen as often as it should. I don't even think the IRS is catching enough wealthy tax cheats. The GOP has traditionally cut funding to the IRS which lowers their audit rate and/or limits their audits to those to the less wealthy. (Since going after the really wealthy requires a lot more work.)
I'll add every dollar of IRS funding nets many more dollars of taxes--if we ran the government like a business (for the sake of argument) we should invest a lot more into the IRS. It's free money.
I don't know if I agree with that but you're arguing against something else.
Do I believe it’s unfair that the wealthy pay a lower effective tax rate than me simply because their income is passive and not wages/salary? Yes.
Do I blame them for perpetuating this state of affairs to the detriment of the nation as a whole? Yes.
If I vote against my own self-interest it’s my own fault for not knowing better, or because I think something else is more important.
No, I think they're defining it as something like "the tax you would have paid if all your personal revenue that year had been ordinary income". The baseline is not an opinionated criterion, it's what most people deal with.
We know these are different, it also seems quite unfair that their standard of living would be unaffected by higher taxes but poorer people are sometimes disastrously affected.
I think maybe the point is to shame those using aggressive tax strategies. You can always exploit the law as written, if you put enough money behind the endeavor. It's impossible to write a law that is bullet proof.
If someone thinks that a tax payer who hasn’t even been accused of tax fraud should be punished, and that “the full amount” is one penny more than the tax code dictates, they’re certainly infected. Someone who wasn’t would instead simply advocate for changing the tax code.