The Ethics of Two Types of Taxation

[Inverted Things]

First, we'll take a look at income tax. So, the government taxes our income. The implication of this is that the government owns part of what we make. OK, that's fine... the government (ideally, assuming the constitution is followed) protects my rights and provides certain necessary services. Basically, I trade part of what I make for roads, military, and protection of rights.

Now let's talk capital gains. The government taxes capital gains at a lower rate than income. However, the government not only provides the same services and protects the same rights; it also grants an additional right: limited liability. So, investors get more from the government than non-investors while paying less. I argue that this is ethically incorrect.

Discuss.

[DWPerry]

ALL taxes are morally wrong.Taxation is theft, the only difference is that with taxation; 99% of people consent to being robbed.

[2952-0-0]

ALL taxes are morally wrong.Taxation is theft, the only difference is that with taxation; 99% of people consent to being robbed.

Will North Korea suit you? They have no taxes whatsoever.

[DWPerry]

ALL taxes are morally wrong.Taxation is theft, the only difference is that with taxation; 99% of people consent to being robbed.

Will North Korea suit you? They have no taxes whatsoever.

North Koreans also have NO FREEDOM!

[Franzl]

ALL taxes are morally wrong.Taxation is theft, the only difference is that with taxation; 99% of people consent to being robbed.

nonsense, robbery is taxation without any form of compensation from the government. You won't argue that certain government services are unnecessary, I hope, like a police force, a military, etc. That of course as an absolute minimum. There are many other things I believe that are worthy of taxation.

[JSojourner]

ALL taxes are morally wrong.Taxation is theft, the only difference is that with taxation; 99% of people consent to being robbed.

nonsense, robbery is taxation without any form of compensation from the government. You won't argue that certain government services are unnecessary, I hope, like a police force, a military, etc. That of course as an absolute minimum. There are many other things I believe that are worthy of taxation.

The taxation is theft chestnut is a popular one among Christian Reconstructionists, the Christian Identity movement, so-called patriot and common law groups and racist hate groups like the Council of Conservative Citizens.  Among others.

The idea is that government takes the money I earn unconstitutionally.  What these nitwits missed is that little line in the preamble about "promoting the general welfare". 

The best of them -- the most genuinely sincere and goodhearted -- believe that if government stopped taxing the people, the generosity and goodness of the American people and of the corporate sector would build roads, care for poor and indigent people, build jails, clean up toxic waste dumps, fund job training and creation programs, establish high speed rail, build newer and better schools, secure quality health care for all and provide for law enforcement and public safety.

In short, if Uncle Sam just stopped taxing, then the "donation fairies" would take care of everything.  Because people and corporations are, at their base, selflessly generous. 

[2952-0-0]

ALL taxes are morally wrong.Taxation is theft, the only difference is that with taxation; 99% of people consent to being robbed.

Will North Korea suit you? They have no taxes whatsoever.

North Koreans also have NO FREEDOM!

They have freedom to praise the wisdom of the Dear Leader. In fact I hear that they also have an additional extra every time they do not thank the Dear Leader for making the sun come out.

[Nym90]

I agree that capital gains should be taxed at a higher rate than income.

[Nym90]

ALL taxes are morally wrong.Taxation is theft, the only difference is that with taxation; 99% of people consent to being robbed.

nonsense, robbery is taxation without any form of compensation from the government. You won't argue that certain government services are unnecessary, I hope, like a police force, a military, etc. That of course as an absolute minimum. There are many other things I believe that are worthy of taxation.

The taxation is theft chestnut is a popular one among Christian Reconstructionists, the Christian Identity movement, so-called patriot and common law groups and racist hate groups like the Council of Conservative Citizens.  Among others.

The idea is that government takes the money I earn unconstitutionally.  What these nitwits missed is that little line in the preamble about "promoting the general welfare". 

The best of them -- the most genuinely sincere and goodhearted -- believe that if government stopped taxing the people, the generosity and goodness of the American people and of the corporate sector would build roads, care for poor and indigent people, build jails, clean up toxic waste dumps, fund job training and creation programs, establish high speed rail, build newer and better schools, secure quality health care for all and provide for law enforcement and public safety.

In short, if Uncle Sam just stopped taxing, then the "donation fairies" would take care of everything.  Because people and corporations are, at their base, selflessly generous. 

There's also the simple fact that if those things that government provides didn't exist, your income would be much smaller than it is. So the idea that the money you earn in your paycheck belongs to you or was all earned by you alone without the help of others is fundamentally flawed to begin with.

[opebo]

It is silly to call taxation 'unethical' for two reasons - 1. there can be no objective morality and 2. the State assigns to everyone their income in the first place, in proportion to their political power.  To complain about taxation by your benefactor is rather to look a gift horse in the mouth, no?

[patrick1]

The  investor takes the risk and should be rewarded and encouraged to grow the economy.  Further, government does not equally reward a capital loss nor should it. I don't have more time to flesh out what I mean but what you propose lends itself to a stagnate economy.

[DWPerry]

It is silly to call taxation 'unethical' for two reasons - 1. there can be no objective morality and 2. the State assigns to everyone their income in the first place, in proportion to their political power.  To complain about taxation by your benefactor is rather to look a gift horse in the mouth, no?

Everything in your post is incorrect.
It is obvious that there are some people that love having money taken from them by force and given to what they perceive as an all-powerful government.
I highly recommend that everyone watch "America: Freedom to Fascism" it highlights the corruption behind the Federal Reserve and the 16th Amendment.

[JSojourner]

We should abolish all taxes and trust that the infrastructure fairies and the generous, selfless American corporate sector will just pick up the slack.

I love it.

"I got mine, Jack.  Now root, hog, or die."

[Storebought]

I agree that capital gains should be taxed at a higher rate than income.

You will love having that position when it comes time to sell your first house.

[Ban my account ffs!]

I agree that capital gains should be taxed at a higher rate than income.

You will love having that position when it comes time to sell your first house.

You wouldn't "hate" it so much if not making as much on your house got you a college education and medical insurance.

I like having government services.

I like knowing that I can vote someone out of office if the roads don't get fixed, that I just won't be ignored or told "you can take your business elsewhere"

I like knowing that my children can go to school and I won't have a disproportionately large tuition bill, because everybody pays a little each year educate today's children knowing that somebody else paid for theirs when they were in school.

It's already been said:  You didn't *earn* much of the money that you are paid.  Much of that economic opportunity was provided to you by services paid for by the American people through taxes.
You can't reap the benefits of the system and then not pay your fair share.

[Nym90]

I agree that capital gains should be taxed at a higher rate than income.

You will love having that position when it comes time to sell your first house.

Snowguy already said it better than myself.

Not to mention that housing prices aren't increasing that rapidly around here, anyway. And I am personally happy to contribute to government so long as it is run relatively competently, which for the most part, it is.

[Storebought]

I agree that capital gains should be taxed at a higher rate than income.

You will love having that position when it comes time to sell your first house.

You wouldn't "hate" it so much if not making as much on your house got you a college education and medical insurance.

I like having government services.

I like knowing that I can vote someone out of office if the roads don't get fixed, that I just won't be ignored or told "you can take your business elsewhere"

I like knowing that my children can go to school and I won't have a disproportionately large tuition bill, because everybody pays a little each year educate today's children knowing that somebody else paid for theirs when they were in school.

It's already been said:  You didn't *earn* much of the money that you are paid.  Much of that economic opportunity was provided to you by services paid for by the American people through taxes.
You can't reap the benefits of the system and then not pay your fair share.

Where did you come up with all of that? I said nothing at all about living in a tax-free anarchy; only that capital gains tax should be in general lower than income taxes, since the cash one risks in a business venture or property ownership, unless insured or hedged, can evaporate at any moment.

Moreover, where do you think the tax money the government collects and disburses for schools and roads come from? Government surely does not manufacture tax income. No, they collect it from wage earners and passive income earners and retirees, all of whom derive their income in some form from private-sector employment, nurtured by someone who risked his life savings, or groups of investors who risk their collective savings, to start and nurture and bail out the business that you despise so much.

And as far as schools, roads, sewers, etc. go ... do you know how any of these things are funded? You got it, through municipal bonds, bundled up by brokerages and sold off to mutual funds and hedge funds and staggeringly rich idle old people, all of whom derive a federal- and state-income tax free income stream generated by you, the local taxpayer!

[Storebought]

I agree that capital gains should be taxed at a higher rate than income.

You will love having that position when it comes time to sell your first house.

Snowguy already said it better than myself.

Not to mention that housing prices aren't increasing that rapidly around here, anyway. And I am personally happy to contribute to government so long as it is run relatively competently, which for the most part, it is.

I pay taxes wherever it doesn't inconvenience me and does not erode too much from my future net worth.

[opebo]

I agree that capital gains should be taxed at a higher rate than income.

You will love having that position when it comes time to sell your first house.

Gains in value of one's primary residence are completely exempted from capital gains tax.

[Storebought]

I agree that capital gains should be taxed at a higher rate than income.

You will love having that position when it comes time to sell your first house.

Gains in value of one's primary residence are completely exempted from capital gains tax.

Since 1997, in a law called the "Taxpayers' Relief Act", which lowered the capital gains tax rate across the board, yes.

[Inverted Things]

It is silly to call taxation 'unethical' for two reasons - 1. there can be no objective morality and 2. the State assigns to everyone their income in the first place, in proportion to their political power.  To complain about taxation by your benefactor is rather to look a gift horse in the mouth, no?

I'm talking about ethics, not morals. Morals are declarative statements about what is right and wrong, while ethics are a set of behavioral habits that lead to a satisfying life.

Let's take an example: My father shares your views on religion and morality, and will give people a verbal dressing down when the issues or morality or immorality come up. Nonetheless, he would be quite pleased to be called an ethical person. He works as a real estate appraiser, and he works very hard to follow an ethical code in his work; many of his peers will do whatever the client asks, but he'll stick to his ethical guns when the client is requesting something that is unethical.

[Gustaf]

First, we'll take a look at income tax. So, the government taxes our income. The implication of this is that the government owns part of what we make. OK, that's fine... the government (ideally, assuming the constitution is followed) protects my rights and provides certain necessary services. Basically, I trade part of what I make for roads, military, and protection of rights.

Now let's talk capital gains. The government taxes capital gains at a lower rate than income. However, the government not only provides the same services and protects the same rights; it also grants an additional right: limited liability. So, investors get more from the government than non-investors while paying less. I argue that this is ethically incorrect.

Discuss.

I suspect that an equal level would be detrimental to the economy because the capital gains tax would be too high. People are less sensitive to incentives than capital is, for one thing.

As for ethics and morals, they're just different words for the same thing. IIRC, ethics is Greek and morals is Latin. And Opebo is as boring a broken record as ever.

[opebo]

...And Opebo is as boring a broken record as ever.

Gustaf, there are over a dozen right wing posts in this thread, each playing a version of the same broken record we hear every day from every pundit in the capitalist media - 'capital gains create jobs, if you tax them there will be few jobs, the clever rich are what makes society work, etc etc'.  Now that is a broken record.  I am almost alone in presenting the left viewpoint, and certainly it is never presented in mass media.  So, your position is the broken record, rightist, not mine.