openpolitics.com

The Difficulty of Taxing the Rich

I wrote this a few years ago in response to a similar piece:
The problem is that the rich have the ability to take their income in alot of different ways.
Tax income more, they’ll take it as dividends.
Tax dividends more, they’ll take it as capital gains.
Tax capital gains, they won’t realize their capital gains until they can offset them with realized losses or they’ll just get bank loans again’t their stock holdings.
Tax assets on death and they’ll pass them o n in trusts. Some will move money off shore if they think they can get better returns that way.
The problem is that no tax code can close all loop holes because you just can’t foresee the creative ways people will out maneuver the tax code.
Who would have thought 25 years ago that companies would buy other companies in different countries, not to acquire their products or markets, but to acquire their headquarters address to lower the tax paid in the US.