Progressive Taxation Act (Failed)

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Sponsor:  Senator Antonio V

Progressive Taxation Act

1. For income gained in 2011 and thereafter, an additional tax bracket shall be added to those defined by the Fiscal Responsibility Act.
2. The new tax bracket shall apply to :
    a) An income superior to $4,000,000 for single individuals.
    b) An income superior to $5,000,000 for civil partners filing jointly.
    c) An income superior to $2,500,000 for civil partners filing separately.
    d) An income superior to $4,000,000 for heads of households.
3. The marginal taxation rate for this bracket shall be 75%.

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If we have a serious budget crisis, then I could see a bill specifically targeted to raise revenue through an income tax surcharge on high earners that includes an expiration date and a clause that requires a new bill to be completely rewritten should the desire come up to "extend" the tax.

If it is a structural deficit, then tax rates have to rise in a way that will provide the revenue needed.  I do not believe a 75% tax on the highest earners will garner the needed revenue.

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Antonio,

Don't let my post make you think I'm against progressive income taxes... I am.  But the point of a progressive income tax in a modern capitalist society is not to punish the wealthy.  It is to make things fair.  Government services should benefit all and also serve to redistribute some of the wealth from top to bottom while paying for it in an equitable way that says "you've benefited the most from society's productiveness, so you will pay the most as well".

There is little evidence that having such a high top marginal rate will really bring in the needed revenue to balance the budget.  I would wait until we know better in order to make such a move.

There are other things that could be done to increase revenue without actually raising the rates.  

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I think the capital gains tax should be higher than that.  Maybe more like 40% for the top gain income bracket.

While that is pretty high, it is also significantly lower than the top earned income bracket which still gives the wealthy an incentive to invest.

I'd support no capital gains tax on more modest incomes or on business owners investing in their own businesses.

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Are you going to withdraw this bill and propose a new bill for a capital gains tax change?

We can't just amend this bill to do as such.. that's too big of a change.

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Debate on this bill has ceased for more than 24 hours.  Since Senator Antonio has not asked that this bill be withdrawn, I will call it to a final vote.

Senators, please vote aye, nay, or abstain.

Vote lasts until February 14th, 2011 5:15pm CST

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Nay

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This bill has failed.

Aye:  Leif, Antonio
Nay:  BaconKing, Snowguy, NCY, DallasFan, HappyWarrior
Abstain:  Bgwah, Eraserhead (not voting)

Senators, you have 24 hours to change your vote.