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April 13, 2005

Comments

squeg

Maybe I've been trapped in a cardboard box lately, but I had to do a bit of googling to determine what the heck a "Paris hilton tax?" might be.

I found this (http://www.washingtonpost.com/wp-dyn/articles/A45305-2005Apr11.html) to be a pretty good run down of what the bill is and folks are against it, for those similarly out of the picture.

But I also found this (http://www.houseoffusion.com/cf_lists/index.cfm/method=reply&forumid=5&threadid=16651&messagecounter=152433) which demonstrates that the people we love to hate are not the only people that such systems penalize. You have to read down to the reply where the respondent discusses how the heirs to farms often have to sell the farm to pay the taxes. I'd imagine this could apply other small/medium sized family businesses where the assets of the company were worth more than it's revenue.

I'm not a conservative, when defined by today's republicans. But I'm certainly not a liberal when it comes to taxing the same money over and over again. Paris Hilton makes an easy target. She's filthy rich, doesn't seem all that bright, and she never has to lift a finger unless someone's paying her to do it on TV. But she's NOT the only kind of person penalized by a steep tax on money and properties that have already been taxed via income, property, and capital gains taxes.

Our government, especially this one, is notoriously bad with money, any money, no matter what it's spent on. And I'm getting to the point where I think almost all taxes and almost all government spending needs to be stripped away. We need to identify what we as a nation believe are absolutely necessary government processes and expenses, and we need to raise the money for those things in a way that makes sense.

When it comes to infrastructure maybe we need to derive government revenue directly from government services. When it comes to welfare systems, maybe we need to find ways to drive more of those systems into the private sector non-profits.

When it comes to taxing money, we need to find a way to do it once. Not every time it changes hands. The government wastes more money on a weekly basis than even most of the wealthiest in our nation make in a year. What constitutes waste, is obviously up for debate, but the FACT that we waste can be demonstrated by the "wealthiest" nation in the world sits under a seemingly insurmountable mountain of debt.

Maybe instead of liberal or democrat, I'm becoming libertarian.

Torridjoe

squeg, there is not a SINGLE documented case of anyone losing a farm based on the estate tax. Not one. You've been taken in by GOP talking points.

What you also may have missed is that while the absolute wealthiest members of society (really their heirs) get a massive, multi-million dollar tax cut, everyone else gets a hike in their capital gains taxes. Because you can no longer claim an estate tax exemption when you realize gains, now you'll have to pay the tax. Bummer.

And heirs are not "double-taxed" on estates. They receive the money once, they get taxed once. Very simple.

squeg

TJ,

I believe you misundertand my concept of "double-taxed." I believe that if I work hard and earn some cash and pay my taxes on that case in accordance with the law, then the remainder of that money is mine to do with as I see fit, baring criminal activity, without further government intervetion. If I choose to give large portions of that money to my family because they're having a hard time, or for any other reason. That money should not be taxed as income for my family. Perhaps that's naive. Perhaps it is easily taken advantage of by those wishing to hire relatives to do some work for them.

I view the passing of property to family after death in the same light. I can't see any real difference between them.

Yes, I understand that the estate taxes are supposed to be aimed at the wealthiest of the wealthy. Yes I believe that there's a sharp inequality of resources amongst the citizens of this country and that the poorer frequently get the short end of the stick. But I also see even small pieces of property taking on ridiculous and over-inflated prices in many areas of our country. I see taxation forcing everyday hard working people to sell their homes because they can no-longer afford to live on land that's been surrounded by increased developement as urban areas spread. (Isn't it interesting that property values are based purely on what someone wants to pay for them, regardless of whether or not they're really for sale?) And I see the great possiblity for steep inheritance taxes to affect people you and I would not consider particularly wealthy.

If anyone can show that does not and cannot happen, I'd love to see it spelled out.

But it really all boils down to this. Living under an adminstration that squanders vast amounts of money; that cuts the kinds of programs I'd be proud to see my money spent on and replaces them with voluntary warfare and bloodshed; that lies to us on a regular basis in the name of politics and "national security;" that allows its members to make huge sums of money pedeling political influence and insider knowledge; I have a hard time not regarding all taxation as evil.

What was that about taxation without representation? I certainly don't feel particularly represented by anyone in politics these days. Do you?

Torridjoe

squeg---
Interesting comments; thanks for your reply.

I don't think you're being naive--but I do think you're creating a loophole where none currently exists, and wondering why the loophole shouldn't be there. Philosophically and practically, income tax is a fee on transfer of value. If you receive value, there is tax to pay. It shouldn't matter, IMO, whether you receive it from a family member, the state lotto, or your employer. As you say, the potential for abuse is rife. Imagine a situation where I have 1mil in income, but I distribute it among my family members, and thus no one pays any tax on the income. Then the next year, those family members give it all back to me, along with any money they might have acquired during the year, and no one pays any tax again. Finally, there IS an exemption for family members; you can gift 10K per person per year, and there may be other ways to present your heirs with assets that are at least delayed in their liability.

I can't say I understand what you mean by taxation forcing the sale of homes, unless you mean property taxes. Value-based taxation has all kinds of pitfalls; I agree. Perhaps a system of usage would be better--if you live in it, you pay less than if you are receiving a profit from it (either as a rental or if you do business out of the property).

One way or the other, however, there are services that we demand and frankly expect--but we often tend to forget about those services when it comes tax time.

And I have no argument at all with your comments on the wastefulness and misdirection of the large total sums that arrive in the form of tax revenue. But of course the solution to that problem is not a withdrawl of tax revenue, but a charge to hold our officials MUCH more accountable for the expenditures they make. Taxation is not inherently evil; failing to recognize the sacrifice that goes into paying tax is the problem here.

squeg

---- Imagine a situation where I have 1mil in income, but I distribute it among my family members, and thus no one pays any tax on the income. ---

Actually, In this case, You'd have paid taxes on the one-mil when it was earned. So this isn't quite the exploit you make it out to be. However, it would allow you to essentially employ family members so that they derived their living from you and wouldn't have to pay income taxes. Now I'm not entirely certain how that differs from people who are designated as legal dependents, but I'm sure it's different.

---- I can't say I understand what you mean by taxation forcing the sale of homes, unless you mean property taxes. ----

Yes, property taxes are exactly what i meant. And there are plenty of cases where those taxes become so large that they basically force a sale. Especially among the retired working class.

---- Taxation is not inherently evil; failing to recognize the sacrifice that goes into paying tax is the problem here. ----

Agreed. Without taxes, there is no government. Without some form of government the strong will continually abuse the weak, wealthy will continually abuse the poor, and the immoral will continually take advantage of anyone they can. Without government commerce is difficult as infrastructure isn't maintained.

But our government is doing an increasingly poor job of protecting those who need protecting and prosecuting those who take advantage of others. It's whittling away at the rights and freedoms we pay them to protect and it's taking dollars that should be spent in civic welfare (infrastructure, education, etc) and pissing them away.

So I don't believe that every new tax is a good one, as every new tax simply feeds an ever growing problem.

That said, I'm not 100% opposed to the discussion of some form of estate tax. But I am opposed to the knee-jerk "this only affect the wealthy and they can afford to suffer" attitude that I read in the coverage of this debate.

Just as taxation in itself is not necessarily evil, neither is being wealthy. Nor does being wealthy necessarily make you unable to determine just and humane ways to benefit society with your money. Sadly, at this time, I have a much higher faith in a few wealthy people doing good with some of that money of their own accord than I do of our government ever spending it wisely. Then again, maybe 2 or 3 people living in a 5 million dollar home is a sure indicator of civic disinterest. I don't know.

Torrid

squeq, your comments are well-thought out and rational. I can't necessarily agree with all the sentiments, but thanks for giving our readers a different perspective. Please come back and see us often!

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