Today, Mitt Romney Lost the Election

huntersberger you idiot, obama never changed people's weddings, he asks for changes in people's weddings like the bros do in subway entrances.

http://www.metro.us/newyork/national/article/1146435--obama-asks-couples-to-forgo-wedding-gifts-donate-to-his-campaign-instead

LICC, LLC's are nothing but modified partnerships - anyone who is organized as an LLC could have been organized as a partnership. LLC's did not become popular until the 1990's.

The OECD study that you cite specifically disproves your statement that "it seems to me that the liberal memes of a regressive U.S. tax system and a huge growth of income inequality doesn't hold water." The top 10% of US income earners earn 14 times more than the bottom 10%, in line with countries like Turkey. Not a single study was cited by name in the "National Review" article you quoted. Not one.

It's pretty well proved that since Ronald Reagan, income disparity has grown considerably in the US.

And I'm not particularly a liberal on economic matters - it just happens to be a fact.

LLCs are similar to partnerships in that the profits are passed through to the owners for tax purposes and therefore are not subject to double taxation like corporations. But they differ substantially in that LLCs give personal liability protection (similar to a corp) to the owners where partnerships do not. In that respect they are FAR different.

The author of the section of the OECD study we are discussing stated his analysis that the U.S.' tax system is one of the most progressive in the world, which I quoted in a previous comment. The studies results clearly support that analysis.

Income disparity may have grown, but the National Review piece is asserting that it hasn't grown as much as some say, and that the causes have more to do with global economic conditions and technology rather than tax policy.

I know what LLC's are - and in partnerships, limited partners do not have unlimited liability. For tax purposes, LLC's are no different from S-Corporations: they are pass-thru entities.

"his analysis that the U.S.' tax system is one of the most progressive in the world"

But it's clearly not. The top 10% of earners in the OECD make 9 times what the bottom 10% make, and their share of total taxes paid is 31.6%. To keep the ratio between total income and total taxes paid constant between the OECD average and the US, in the US, where the top 10% makes 14 times what the bottom 10% pays, to equal the OECD average the top 10% of taxpayers would have to pay 48.98% of all taxes.

But they do not. They only pay 45.1% of all taxes.

Then, strip out the US from the average (and it's not clear whether it's a weighted average or not), and the disparity is worse.

Clearly the US tax system is more regressive than the OECD average. In fact, the study says that in very tax-progressive countries (also very successful countries, such as Scandinavia) the effective tax rate of the top 10% is between 35-38%. In the use, the effective tax rate for the top 10% is about 20%, or about half of what truly progressive systems are.

"Income disparity may have grown, but the National Review piece is asserting that it hasn't grown as much as some say, and that the causes have more to do with global economic conditions and technology rather than tax policy...."

Then let them identify the studies that they are quoting, so we can look at them and at what they say. Just saying something doesn't make it true.

Why does this keep happening to me?

"In the use" = "In the US"

Q: "Why does this keep happening to me?"
A: You have been hanging out too much with Brooks2

The numbers don't lead to that conclusion. Look at Table 4.5 in the study, which compares the share of taxes with the share of income. From Mankiw:

The first column shows that the top 10 percent of households in the U.S. pays 45.1 percent of all income taxes (both personal income and payroll taxes combined) in the country. Italy is the only other country in which the top 10 percent of households pays more than 40 percent of the income tax burden (42.2%). Meanwhile, the average tax burden for the top decile of households in OECD countries is 31.6 percent.

By contrast, column #2 shows that the richest decile in America earned 33.5 percent of the market income in the country in 2005 - the year in which this snapshot was taken, but little has changed since then. But, a few other countries do have a greater or similar concentration of income as does the U.S. For example, the OECD table shows that the wealthiest decile of households in Italy and Poland earn a greater share of their country's market income than do our "rich" - 35.8 percent and 33.9 percent respectively - while the share of income earned by the top decile of households in the U.K. is about on par with those in the U.S. at 32.3 percent.

The table then adjusts for the underlying allocation of income by showing the ratio of income taxes paid to the share of income earned by the top decile in each country. The ratio for U.S. households is 1.35, far greater than the ratio of taxes to income in any other country. Even in the three countries with a comparable distribution of income, the ratio of taxes to income was less, 1.18 in Italy, 0.84 in Poland, and 1.20 in the U.K.

Unfortunately, the reasoning is flawed. First of all, the study is on income distribution, not on tax burden.

Nonetheless, to prove regressiveness, you have to compare what the top percentage pays in terms of income versus what the bottom pays. All you've done is show what the top pays as a percentage of total income, not compared to what the bottom pays.

Therefore, that analysis doesn't show what you are claiming it shows - it says ZERO about how progressive or regressive the tax code is.

The progressiveness of a tax system and income distribution are two different things. You can have a progressive tax system with either high or low income distribution, and vice versa. The study specifically addressed the progressiveness of the tax systems and found the U.S. to be very progressive. And as was said earlier, it didn't even look at indirect taxes such as a VAT, which makes the US system even more progressive by comparison since the US doesn't have a regressive federal VAT-like tax.

"The progressiveness of a tax system and income distribution are two different things."

That's my whole point. The study was one of income distribution; extrapolating its results to progressiveness of taxes is fundamentally flawed, yet that is what was done.

VAT is a direct tax.

Q: "Why does this keep happening to me?"
A: You have been hanging out too much with Brooks2

Very funny (bcs its true. The typos)..

We need a flat tax with no loopholes. Simple and equitable. In Hong Kong it was 16%.

stevie jhx has manipualted these OECD stats to fit his narrative in ways no one has to accept.

First, the quoted stats: 31.6% of taxes paid by the top decile in OECD countries - these stats are based on a simple average of the 24 countries, which gives equal weight to Iceland, Finland, Poland, and Belgium. Weighted by population, you'd be a lot closer to the US 45%.

Second, why are we defining the slope of progressivity as income top decile vs bottom decile? That is arbitrary and starts using ratios as numerators and denominators of new ratios.

Third, why is the goal to be more progressive than a fake simple average OECD figure? What's the average of the G-77?

I didn't fake anything. Those are the only figures that are available, if you click on the links.

No, the "slope of progressivity" is not necessarily the top decile v. the bottom decile. That is a crude way of doing it, but those are the only data in the report.

My only point was to show that what the report purports to show, it does not:

1) It is a report on income distribution, not on tax progressiveness, and therefore attempting to extrapolate tax progressiveness results from income distribution data is inherently flawed. However, I was not the one to do it - LICC quoted a report by a noted economist that attempted to do precisely that.

2) Without prejudice to that, the logic of the report by the noted economist is seriously flawed, for the reasons I state.

I fully agree with you that the report is inadequate to draw the conclusions that the author of the report drew. I simply pointed out the flaws with what little data are available.

"I can agree with changing the carried interest rule, as it is effectively advisor compensation rather than capital investment. But, Since 1955, every time capital gains tax rates have been reduced, capital gains tax revenues have gone up. And every time capital gains tax rates have been raised, capital gains tax revenues have gone down."

Meaningless.

That is the temporary effect from folks timing their gains. You can choose when to realize your gains. But, long term, you can't do much to minimize your gains without totally changing your investments, which doesn't seem to happen to the masses with capitali gains changes.

Bloomberg...

"the median effective tax rate for the middle 20 percent of U.S. taxpayers is 13.3 percent, including income, payroll and corporate taxes. For the top 1 percent of taxpayers, the rate is 29.6 percent, according to the 2012 Economic Report of the President."

Also, the US has state and local taxes which in EVERY state except Vermont are DEEPLY REGRESSIVE. I.e. - literally, in Texas those in the top 20% pay about 2% of their income in State and local taxes versus 12% for the bottom 20%. Litterally. Even California and NY are regressive in similar ways. So the overall tax burdon by quintiles in in fact...flat. Making the FEDERAL code flatter would make the net tax impact regressive.

LIC knows this - posted this before. This is a long report on EACH of the 50 states, and on the US as whole in terms of average state and local tax burden.

http://www.itepnet.org/whopays3.pdf

See also

"...Low-income families also pay substantial state and local taxes. Most state and local
taxes are regressive, meaning that low-income families pay a larger share of their incomes in these taxes than wealthier households do. The bottom fifth of taxpayers paid 12.3 percent of their incomes in state and local taxes in 2011, according to the Institute on Taxation and Economic Policy (ITEP).[20] That was well above the 7.9 percent average rate that the top 1 percent of households paid (see Figure 3).
Considering all taxes — federal, state, and local — the bottom 20 percent of households pays an average of 16 to 17 percent of their incomes in taxes. The next 20 percent of households pays about 21 percent of income in taxes, on average...

In fact, when all taxes are considered, the share of taxes that each fifth of households pays is similar to its share of the nation’s total income.[22] ITEP data show that in 2011, the bottom fifth of households received 3.4 percent of the total income in the nation and paid 2.1 percent of the total taxes. The middle fifth of households received 11.4 percent of income and paid 10.3 percent of taxes. The top 1 percent of households received 21.0 percent of income and paid 21.6 percent of taxes. The tax system as a whole is only mildlyprogressive.[23]..."

http://www.cbpp.org/cms/index.cfm?fa=view&id=3505

>Most state and local
taxes are regressive, meaning that low-income families pay a larger share of their incomes in these taxes than wealthier households do.

What is your suggestion? Who should pay for clean water and local roads and schools?

"Some of the worst offenders are Florida, where the top 1 percent pays a 2.1 percent tax rate while the bottom 20 percent of households pay 13.5 percent; Illinois, 4.1 percent and 13 percent, respectively; Nevada, 1.6 percent and 8.9 percent, respectively; Texas, 3 percent and 12.2 percent, respectively; and South Dakota, 1.9 percent and 11 percent, respectively. Washington state though, is the worst, where the richest 1 percent pay a 2.6 percent tax rate while the poorest 20 percent pay a whopping 17 percent in taxes."

http://thinkprogress.org/economy/2012/09/21/887581/state-taxes-1-percent-low/

From the sources I list above. So at the state and local level, the 1% are the parasites.

Shouldn't taxes be regressive?

absolutely! Social Security as designed is regressive to total income. Sales taxes have nothing to do with income, so whatever it ends up being to total income, just a calculation, a number.

jason, those numbers are so simplistic. washington state has no income tax, which greatly benefits the wealthy. but the sales tax is generally not higher than places like new york (and a fair amount less, i think). and real estate taxes are relatively high for those who own. i'd say that in washington state it's likely that the poorest 20% are much better off than the poorest 20% in almost any other state.

numbers are complicated.

SS is not regressive or progressive. It's a retirement benefits insurance program. This idea that people who earn more should pay more but be capped on their benefits can only be based on an entitlement theory that someone else is responsible for your life. As liberal as our education system is, they still teach stories contrary to this belief as early as kindergarten or first grade.

"Also, the US has state and local taxes which in EVERY state except Vermont are DEEPLY REGRESSIVE."

Huh? NYC/NYS taxes are INCREDIBLY progressive.