WA anti-tax activist again targets trains and transit

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sttom said:
If the $50,000 bracket pays 20% and you jump to 45% when you go over $70,000 that will be a disincentive to a lot of people.
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Disincentive to who?  Did you ever turn down a raise that put you into a higher bracket?  I sure as hell haven't.
 
XHRTSP said:
Disincentive to who?  Did you ever turn down a raise that put you into a higher bracket?  I sure as hell haven't.
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Some people will. Which is what the whole anti tax arguments are generally based on. Its just not as low as they make it out to be. 
 
sttom said:
Some people will. Which is what the whole anti tax arguments are generally based on. Its just not as low as they make it out to be. 
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Do you know how tax brackets work?

Let's say under your scheme there are two tax brackets: $0-70,000 at 20%, and $70,001 and above at 45%.  How much in taxes does someone making $70,002 pay?
 
Stuff works rather differently in the US, compared to the UK...

Obviously, most car drivers will vote for anything that "caps" the amount they need to pay out, if that car tax only funds things they don't need...

If all taxes were lumped together in one pot, then all services funded would feel a little pain in lean years, and relief in good years.

The way that some programmes seem to be "held hostage" to unrelated matters, become "bargaining chips", does not seem to be a feature of UK politics.

(Politicians the world over argue about taxes, funding and spending, but the "hostage" element seems an American device?)

Ed. 
 
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Devil's Advocate said:
I used to believe that, but after the Brexit fiasco (and the Jo Cox murder) the UK is looking more and more like the US.
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I was refering to the way the taxes are raised and spent, but I do believe strongly that our standards in public office are dropping rapidly.

Those politicians with low standards fed the public a pack of lies, and the narrow Brexit vote was the result.

Jo Cox's murder was the act of a nutter, also fed lies by others with low standards, pure and simple.

Ed
 
sttom said:
XHRTSP said:
Disincentive to who?  Did you ever turn down a raise that put you into a higher bracket?  I sure as hell haven't.
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Some people will. Which is what the whole anti tax arguments are generally based on. Its just not as low as they make it out to be. 
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You fundamentally do not understand tax brackets. The whole system is structured such that there is absolutely no case where making more (and therefore being put in a higher bracket) will be a net loss. You pay the percentage on the amount that is in each respective bracket, not the whole thing.

These are the U.S. Federal (single person) tax brackets:


Tax rate


Single


 


10%


Up to $9,525


 


12%


$9,526 to $38,700


 


22%


$38,701 to $82,500


 


24%


$82,501 to $157,500


 


32%


$157,501 to $200,000


 


35%


$200,001 to $500,000


 


37%


$500,001 or more

So someone who makes $38,700 (and therefore only reaches bracket 2) pays a total of $4,453.5 in federal taxes, consisting of $952.5 in bracket 1, and $3,501 in bracket 2. While someone who makes $38,701 and is therefore put in bracket 3 (a pretty significant 10 percentage points higher than bracket 2), still takes home an extra $0.78 on the $1 he makes above that first person.

So I repeat: when it comes to taxes, making more money still will always result in you taking home more money.
 
cpotisch said:
You fundamentally do not understand tax brackets. The whole system is structured such that there is absolutely no case where making more (and therefore being put in a higher bracket) will be a net loss.
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In my own career there have been situations where credit and deduction maximums were exceeded before the increased income could counteract the loss of those benefits.  That's not to say I ever turned down a raise, just that receiving a raise or bonus doesn't always avoid a net negative situation.

Bob Dylan said:
Americans are the Lowest Taxed People on Earth as a whole( maybe not in New Jersey? ^_^ )but complain the most,especially the 1%!!! <_<
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Average Americans are taxed less than some countries and more than others.  The main difference I can see is that we receive far more limited benefits with many more restrictions than almost any other industrialized democracy.  All our effort seems to be on blindly reducing taxes below our peers rather than on trying to improve the return for what we already contribute.
 
cpotisch said:
You fundamentally do not understand tax brackets. The whole system is structured such that there is absolutely no case where making more (and therefore being put in a higher bracket) will be a net loss. You pay the percentage on the amount that is in each respective bracket, not the whole thing.

So I repeat: when it comes to taxes, making more money still will always result in you taking home more money.
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While you are generally correct, it's a little more nuanced than this.  One example of where making more can be a net loss is when you are the beneficiary of government aid programs.  A raise could put you just above the threshold for eligibility for these programs.  This is known as the "welfare cliff."  It's a very complicated topic, but it is possible to get a raise and be worse off under this scenario.  But you are correct that, when it comes to your tax bill alone, the tax code is designed to put more overall money in your pocket when you get a raise

Devil's Advocate said:
In my own career there have been situations where credit and deduction maximums were exceeded before the increased income could counteract the loss of those benefits.  That's not to say I ever turned down a raise, just that receiving a raise or bonus doesn't always avoid a net negative situation.
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My understanding is that itemized deduction phase outs were eliminated in the 2018 tax bill.  I don't claim to be an expert, though, so it's possible that I am wrong.
 

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