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Main St. & Main, Inc. (MAIN) Message Board

  • kateschneid kateschneid Nov 15, 2012 9:41 AM Flag

    The concept of double taxation

    I made a comment on this under the Obama post, but it got kind of buried, and I really want to know how all you 'double-taxation' believers would respond to my argument:
    If you were to make money at a job then take the money left after paying taxes and start a business with said money, then earn money from that business, you wouldn't say, "I shouldn't have to pay taxes on what I make from the business because I was already taxed on the money I used to start the business." Or if you took that money and bought an apartment complex you wouldn't say, "Well, I shouldn't have to pay taxes on the rent received because the money I used to buy the building was already taxed!" How is getting capital gains or dividend proceeds from a stock any different? You are taking money and putting it to work earning more money, just as you would be doing with the businesses you started with the money. The only big difference is you are taxed at a much lower rate on that stock money than on the businesses under the current system. "Double-taxation" just an argument the already rich have always used in hopes of getting richer.
    If I wrote the tax code we'd get rid of self-employment tax, everyone one would get the same amount of SS when they retire (rather than tying it to contributions), and I would charge SS/Medicare tax on dividends, interest and capital gains. And raise the ceiling on what level of income pays SS taxes (to a million? 10million? Not sure - details). That way every type of earning would pay the same % of tax. Oh, and of course the 15% top bracket on cap gains and some dividends would end. Call me a socialist if you like, but that's what I call FAIR. Everything and everyone taxed exactly the same!
    And MAIN rocks!!! Best stock I own.

    Sentiment: Strong Buy

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    • Capital gains tax I would agree on. Dividends are already taxed and paid for by the company that is paying them out. You did know that, didn't you? So any additional tax to the receiver is then a double taxation.

      Sentiment: Strong Buy

    • Bc, technically speaking, when you buy a share of a company - you are buying ownership of that company. When the company is taxed, it eats into its net profit - thus eating into your eps. So unless they change the definition of a shareholder - then it is double taxation. Whether it is fair or not is debatable. But I believe, logically, it is double taxation and therefore unfair. But then again, it is the gov't way of saying you really aren't an owner of this company, just like Obama said " You didn't build that"

    • mychkael@sbcglobal.net mychkael Nov 15, 2012 10:54 AM Flag

      The problem is not the rich as Obama has brainwashed you with.

    • OK, I make so much from my job and I can either spend it all (consumption) or save and invest it all, or some combination thereof. So I spend some and save/invest some, and I pay a sales tax on what I consume and I pay dividend and cap gains taxes, which are higher, on what my savings return to me which will afford me the ability to consume more in the future (on which I will be paying sales tax.) So ones consumption dollars are double taxed (income and sales taxes reduce what one can enjoy from ones labor) and savings/investment is triple taxed (income, dividend/cap gains and then ultimately sales taxes). But forgetting for the moment that final sales tax related to choosing to consume later via savings/investment, why should a dollar of consumption be taxed (sales tax) so much less than a dollar of savings (dividend and cap gains taxes) ???

    • Include in your proposal that everyone pay the same income tax rate with no credits and no deductions, and then maybe we would have something that sounds fair. When 47% of tax filers pay no income tax, we have a problem because they have no incentive to elect representatives in Washington that will try to limit their spending to prudent levels. In fact, just the opposite situation exists today. We have millions of people clamoring for more and more irresponsible fiscal spending because someone else is picking up the tab. The really sad part is that the "someone else" will be the next generation.

      If a person earns $50K/year, but charges $80K/year to their credit card, the first thing they should do is STOP SPENDING! You can talk about trying to get that person to earn more money, but unless they do something to control their spending, it won't do any good. Our nation has a SPENDING problem, not a revenue problem.

      • 2 Replies to raych1000
      • You forget to mention that many of the 47% pay 5.65% payroll tax - or 13.3% if they're self-employed - and that's on every cent they net! I researched this when I created my halloween costume this year (I went as the 47% NOT voting for Mitt...in case there was any question about my politics). And yes, there are always some free-loaders in any society. On the bright side, every cent you give the free-loading types gets spent. And every cent you give the poor gets spent (because they need to spend it to survive). Whereas the $s you give to the savers...gets squirreled away. So the most efficient way to stimulate the economy is to provide the most tax savings to those who earn the least.

      • Our nation has a SPENDING problem, not a revenue problem.
        BULLSEYE!
        This IS the problem!

 
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