Tax Reality Check

[atlcomedy]

Originally Posted by TexTushHog

Gas, utility taxes, etc. are basically meaningless to the wealthy because they are so small relative to income. .

Not if you own a business that makes something or needs something transported...

...but as always TTH from your myopic view it always looks that way...

[TexTushHog]

Conceivably if you're in the trucking business, fuel taxes are a significant. But it's hard to imagine something made that requires transportation such that fuel taxed would up a wealthy individual's level of taxation from 40% to over 50% as some claimed. It would have to be a large, heavy, bulky product that had a low profit margin, I would think.

If the base taxation rate is 40%, fuel TAX costs would have to be equal to ten percent of your profits. And I think fuel taxes (which are set by in terms of cents per gallon versus a percentage) are less than ten percent at today's fuel prices.

[FatBastard]

I advocate no taxes on businesses.

Only tax individuals and consumers. That's where the business taxes end up.

0% of the first 25K; 15% 25k to 250k; then 25% thereafter.
No deductions, no exemptions no where no how.

Also support a national sales tax of 1% which would go to deficit reduction coupled with a balanced budget constitutional ammendment.

[FatBastard]

TTH, here is one for you....

Let's say you have some oil and gas production.....state severance taxes of 11% to 16%, then state income tax of 6%....thats 22%, then if you are in the 35% bracket, that's 57% on the margin and that is before any property or sales taxes et al are paid. Welcome to my world!

[pjorourke]

Don't Vote It Just Encourages the Bastards

[London Rayne]

Originally Posted by atlcomedy

As a small business owner I have the pleasure of writing checks to the governments on a quarterly basis In fact most of you providers out there should be doing the same I'm sure you all report all of that cash income

And yes, if most Americans had to do the same as opposed having their taxes withheld there would be an uproar that makes these tea party rallies look small.

I also own/run a small business and pay quarterly...not that I work at it more than 2 days a month, but it's still a legit operation. Because we are mostly non-profit right now, I get a big break on that as well.

My escort taxes get tossed in with that, and everything I give to the Church (OMG) is a deduction so it evens out. I would prefer to pay sales tax as I go now, than to have it add up and hit me at the end of the year.

[atlcomedy]

Originally Posted by TexTushHog

Conceivably if you're in the trucking business, fuel taxes are a significant. But it's hard to imagine something made that requires transportation such that fuel taxed would up a wealthy individual's level of taxation from 40% to over 50% as some claimed. It would have to be a large, heavy, bulky product that had a low profit margin, I would think.

If the base taxation rate is 40%, fuel TAX costs would have to be equal to ten percent of your profits. And I think fuel taxes (which are set by in terms of cents per gallon versus a percentage) are less than ten percent at today's fuel prices.

It isn't just transportation but utilities (and associated taxes) as part of operating expense in a manufacturing business.

I don't really follow your math but in fairness to you this whole notion of a single point effective or marginal tax rate starts to fall apart anyway. With all due respect to WTF's study (& I'm sure the authors all have PhDs from fine schools etc.), we live in a world that is more complicated than everyone getting w-2's & being able to file a 1040ez

For example, consider a $5Million gross revenue business that shows a $250K net operating loss & paid any amount in utility, sales, use, property tax etc. what does that do to this 40% thing???

Or what about the retiree (or college student) that has nominal income but lives off of savings (in the case of the student, Mom & Dad). He would have an all in tax rate in excess of 100%....

[Guest083011]

Originally Posted by London Rayne

everything I give to the Church.

The Church of Love?

[Naomi4u]

Originally Posted by London Rayne

My escort taxes get tossed in with that, and everything I give to the Church (OMG) is a deduction so it evens out. I would prefer to pay sales tax as I go now, than to have it add up and hit me at the end of the year.

Amen to that..

[TexTushHog]

Originally Posted by FatBastard

TTH, here is one for you....

Let's say you have some oil and gas production.....state severance taxes of 11% to 16%, then state income tax of 6%....thats 22%, then if you are in the 35% bracket, that's 57% on the margin and that is before any property or sales taxes et al are paid. Welcome to my world!

But you're not really getting taxed at a 35% marginal rate because you get a 15% depletion allowance on you net production. So you on your O&G royalties, you're only paying 29.7% in Federal income taxes. At least that's what I pay.

[FatBastard]

Correct if you are using percentage depletion vs barrels depletion. My point was add to that the state severance tax of ~16% and state income tax of ~6%, that adds up to 51.7%. Thats pretty damn steep. What do you think would happen to the cost of hobbying if Uncle Sam was there taking $200 of every $400 hourly fee? Then deduct travel cost, advertising and marketing, maintenance....geez, they probably get down to $150/hour, which would then force them to increase volume....getting a headache....

[London Rayne]

Originally Posted by FatBastard

Correct if you are using percentage depletion vs barrels depletion. My point was add to that the state severance tax of ~16% and state income tax of ~6%, that adds up to 51.7%. Thats pretty damn steep. What do you think would happen to the cost of hobbying if Uncle Sam was there taking $200 of every $400 hourly fee? Then deduct travel cost, advertising and marketing, maintenance....geez, they probably get down to $150/hour, which would then force them to increase volume....getting a headache....

Exactly, which is why I laugh and cry every time someone says it should be legal. It would only be appealing to the guys!