Taxing the Rich Never Pays

Neo Neocon is on top of this story that the left will never understand.

There are three unintended consequences from states raising tax rates on the rich. First, some rich residents sell their homes and leave the state; second, those who stay in the state report less taxable income on their tax returns; and third, some rich people choose not to locate in a high-tax state. Since many rich people also tend to be successful business owners, jobs leave with them or they never arrive in the first place. This is why high income-tax states have such a tough time creating net new jobs for low-income residents and college graduates.

Whether you like it or not, when the rich make money, jobs are created and more taxes are paid. it has been proven again and again. Class warfare and taxing the rich will only lead to less job creation and less tax revenue. Unfortunately, the left does not understand this principal and will continue to try to lead us to ruin.

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~ by thedark2 on October 7, 2009.

8 Responses to “Taxing the Rich Never Pays”

  1. Of course, that doesn’t apply with federal taxes. I don’t see many rich people moving to countries with low tax rates.

    • Many might not physically move, but they will take the business off shore. They will also find ways within the tax code to lower their reportable income or simply scale back. It has been proven again and again that the lower the tax rate, the higher the revenues that come into the IRS.

      • Name just one time when that happened. You can’t because it doesn’t. Reagan believed it and it worked in theory, but the result was huge deficits because revenues dropped dramatically. The same thing happened with Bush’s tax cuts. That’s how he manged to double our national debt. Regan tripled our debt with his tax cuts.

  2. Try this out.

    http://online.wsj.com/article/SB119786208643933077.html

    And there is evidence that lower tax rates since 1981 have caused the rich to declare more of what they earn. In 1980, when the top income tax rate was 70%, the richest 1% paid only 19% of all income taxes; now, with a top rate of 35%, they pay more than double that share. With lower rates and fewer tax loopholes after the 1986 reform, there is less incentive to shelter income to avoid tax.

    Class warfare is not the answer. Those with money have usually earned it and want to make more. You do that by investing and creating jobs. Higher tax rates are great for Government, but bad for business, workers and the ecomony.

    • You’re saying that the CEOs of the financial institutions who earned upwards of 10 million dollars a year, and we bailed out with our tax dollars, earned it? Nobody with a salary of that much “earn” it. They get paid that much by scamming the system and for short term gains.

      If somebody invents something and becomes a multi-millionaire, they earn it. CEOs of large corporations don’t, and they comprise the bulk of the uber-wealthy. We need to get back to the old tax rates of 70% for those people.

  3. Let the free market work it out, nit the government. Companies that pay CEO’s more than they are worth will not remain financially viable for a long period of time and will pay one way or another. You are referring to a small percentage of those who achieve in this country. Punishing all for the sins of a few is reckless and unnecessary.

    • That was Alan Greenspan’s philosophy: that the free market would work itself out. After the collapse of the financial sector, Greenspan came to the realization that he was wrong and announced it before Congress.

  4. The market has collapsed before and will again. We are a free market country. If you would like something else, there are many choices abroad, but many of those have failed as well.

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