Hey, David does a lot of discussion about taxes, wealth tax, capital gains, tax income
tax question.
Can you just tell us what you think the top marginal tax rates should be?
Yes, I can.
I think it should be between 70 and 73%.
Um, now I am not suggesting that at a $500,000 a year in income where the question that I
have is at what income level should a 70% marginal tax rate kick in?
It shouldn't be after you earn $50,000.
I don't believe it should be after you earn $150,000 I don't believe it should be.
Once you're earning $500,000, I think that we should get to 70 or 73%.
The overwhelming majority of the research I've seen shows that if scaled correctly,
topping out at 70 or 73 generates the most government revenue before you start losing
revenue because the tax is so high that people start getting disincentivized from work.
So I've seen proposals that kick in the 70% at $1 million a year of income.
I've seen proposals that do it at $2 million a year of income or $5 million a year of income
or $10 million a year of income, maybe 10 millions too high.
That really is a very small percentage of the population, but there are two things to
keep in mind.
One, uh, it's the marginal tax rate below that level of income, wherever you set it,
you are paying a lower rate.
And number two, there should be more rates between our current top rate.
I believe the current top rate is 37% there needs to be more between 37 and 70 if that
were to be kicked in, so it would be graduated, you might go, okay, I think right now for
20 or four 80 maybe is where 37% kicks in.
Then you might go to 45 between four 80 and seven 50 or a million.
Then you might go to 52 between 1,000,002 million.
It's got a scale and those are the models that generate the most government revenue
and they are not so oppressive that they start to disincentivize work.
In a, that will be problematic for the economy.
A lot of research on this, I'm always up to having my mind changed on it.
Now there's other questions that are ancillary to this that are important ones.
Like for example, should capital gains be taxed at that same rate?
Right now there's a lot of very wealthy people who uh, if they were to pay income tax as
a, as earned income as wages would be paying 37%, but because they are receiving a lot
of this income through capital gains, whether it's dividends or other sorts of capital gains,
selling stocks that they've made money on, um, they are taxed at the lower capital gains
rates.
So one idea that is often mentioned is in order to eliminate that, you really need to
raise the capital gains rate to simply be what the, uh, earned income, the, the wage
rate would be personal income tax rates, so that there is no advantage to earning the
income via capital gains rather than working for a living as, as some like to say I'm open,
I'm open to raising, I believe capital gains should be raised, but I think you also need
more levels previously or right now I believe that there's just two rates for capital gains.
I think it should be progressive.
It needs to have more tiers than two.
And I'm getting, I'm going from memory here, I'm, I'm just riffing.
Um, but I do think that there are more delicate considerations when you raise capital gains.
I think it should be done, but I think we need to understand that it is not the same
as raising taxes on a wages.
But to go back to the beginning, I believe the top marginal tax rates should be 70%.
The debate is at what level of income should that rate kick in.
And I want to hear from you, uh, on this issue.
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