Oops!!!!

[inactive]

Math again? Now where did that come from?

I know right?! And it's not even partisan math. Calculus for the win

 

[EFsDad]

Except you example is not relevant, as the our tax rates are bracketized, meaning that the initial $49,999 is taxed the same rate in either scenario. The higher marginal tax rate would be on any any additional income earned in the higher brackets.

I'm a Libertarian too, so I'm not arguing necessarily for a higher tax rate on higher incomes. But I am compelled to correct disinformation.

Damn I knew that and did not even consider that for that instant.

 

[Lurker66]

Well it's hard to convince people to give you their money with nothing in return.

I know, i dont like paying taxes either. Its a hopeless mess with way too much partisanship. If taxes go up, ill pay, and stay retired. If they stay the same, ill pay and stay retired, if they go down, ill pay and stay retired.

 

[inactive]

Damn I knew that and did not even consider that for that instant.

No harm no foul. But like I said, higher marginal rates in fact lead to higher average rates, which leads to diminishing marginal return, which leads to suppressed output on the whole.

There's a marginal tax rate sweet spot on there somewhere.

 

[tRidiot]

Let's see... if I work more and earn more, I get penalized by paying a higher percentage in taxes. Therefore, in order to make an extra dollar in the top tax bracket, I have to work harder to make that same dollar than if I were in a lower bracket. Thus, I am making less per hour worked, although my net may be somewhat higher, due to putting in increasingly higher hours. It just isn't worth it to work that much harder to achieve a lower gain than if tax rates were low.

I'm looking at cost/benefit analysis of my time vs my net reward. There comes a point where time at home with the fam and relaxation time becomes more important than the cash reward, and higher taxes simply make that break even/tipover point come that much earlier. For me.

It's actually quite simple.

 

[inactive]

Let's see... if I work more and earn more, I get penalized by paying a higher percentage in taxes. Therefore, in order to make an extra dollar in the top tax bracket, I have to work harder to make that same dollar than if I were in a lower bracket. Thus, I am making less per hour worked, although my net may be somewhat higher, due to putting in increasingly higher hours. It just isn't worth it to work that much harder to achieve a lower gain than if tax rates were low.

I'm looking at cost/benefit analysis of my time vs my net reward. There comes a point where time at home with the fam and relaxation time becomes more important than the cash reward, and higher taxes simply make that break even/tipover point come that much earlier. For me.

It's actually quite simple.

Yup. That I agree with entirely. I tried to allude to it earlier.

there will be a point of diminishing marginal return where the net gain is so small that working more just isn't worth it the effort.

higher marginal rates in fact lead to higher average rates, which leads to diminishing marginal return, which leads to suppressed output on the whole.

 

[inactive]

They could probably tax the large corporations that have structured to evade taxes some trivial rate, like one TENTH of one percent of income after expenses and losses, and end up with more gained than increasing top-tier income tax rates.

I'm kinda making the figures up, but I think my point is solid. The system is broken but wringing the citizenry out of more money isn't a good first step.

 

[EFsDad]

No harm no foul. But like I said, higher marginal rates in fact lead to higher average rates, which leads to diminishing marginal return, which leads to suppressed output on the whole.

There's a marginal tax rate sweet spot on there somewhere.

Wait a minute, stop the trains...

If we look at it from the other end... (the ellipses are for Maverick)

And I make 9,999 and pay no tax my net is 9,999...

But if I make 10,000 and pay 10% then my net is 9,0000...

I know that we were talking about the top rates, but the premise that an increase in gross never leads to decrease net is offset.

 

[inactive]

Wait a minute, stop the trains...

If we look at it from the other end... (the ellipses are for Maverick)

And I make 9,999 and pay no tax my net is 9,999...

But if I make 10,000 and pay 10% then my net is 9,0000...

I know that we were talking about the top rates, but the premise that an increase in gross never leads to decrease net is offset.

You are right that the examples get fuzzier when the incomes get lower. Particularly because on incomes that low, there is a possibility of gain for those lower earners, as they receive straight up tax welfare by way of EIC and other credits that could exceed the take home pay on slightly larger incomes.

But the people who would be affected by tax increases that applied only to top income brackets, then the regular marginal tax rate example I outlined earlier is more applicable.

 

[WTJ]

Bernie Sanders is an Independent.