"We are the only OECD state where some get back more than they pay in income tax"

If you have earned €50k by Wednesday why bother coming in Thursday/Friday no matter what the tax rate?

And the point is that when you get to those income levels you are running out of days of the week to spend it. So I guess most of the guys in this bracket who do continue to work are doing so for different reasons than accumulating more spending power.

And the further point is I don't thing B/S 7 year 100% scheme would of itself put them off.
 
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TheBigShort said:
True, there is waste at all levels, and it will be a tall order to eradicate it all. But perhaps a starting point would be to identity excessive waste.
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This is exactly why I am against your proposal. As you have stated yourself, capping income at 2m a year would only affect a tiny proportion of people who can still live a good life on 2m a year. As they would leave anything greater than 2m in their companies it would yield nothing in taxes. It would be oh so tempting then to reduce the 2m cap downwards. Where would the line be drawn? 1m? 500k?. The People Before Logic have targeted 100k for special treatment.....

Don't get me wrong. I think the concentration of wealth in the world today is wrong when we have so many people in need. However I don't think an income limit is the answer. Sadly I don't have a concrete answer myself and on this point I respect that you have provided a proposal. I just don't see it working as if it was possible, I would think it would have been tried somewhere at this stage.

TheBigShort said:
Mark Zukerberg is a US citizen. Like minimum wage, a max wage would vary from jurisdiction to jurisdiction.
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This is exactly why your proposal would fail. Unless it was introduced at a global level it opens the door for the super-rich to relocate. Even if that vast majority of countries complied with your proposal those that remain outside the agreement would benefit handsomly.
 
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Firefly said:
As they would leave anything greater than 2m in their companies it would yield nothing in taxes.
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If left in companies it would increase the capital base of that company. If left in a company it would be managed by managers of the company who are paid to utilize the capital base of the company to produce more goods, to innovate, to research, to market etc. If left in the company, the wealth is more likely to be used effectively and productively in the economy creating jobs, than under a mattress as cash, or as bar of gold in a vault, or hanging on a wall as an over-inflated work of art.

Firefly said:
It would be oh so tempting then to reduce the 2m cap downwards. Where would the line be drawn? 1m? 500k?. The People Before Logic have targeted 100k for special treatment.....
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I've already said the proposal would be protected by legislation. There is nothing to stop any political party proposing we abandon the euro and instead trade in cabbage leaves - it wont get the political support. The €100K limit with PBP refers to a higher rate of income tax, typically 50%. That is not what this is about. This is setting a max income at a bar so high, that only around 300 are going to be directly affected. The other 99.985% of the working population will not be directly affected.

Firefly said:
I would think it would have been tried somewhere at this stage.
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Given the level of opposition on this site for even proposing any form of increase on tax on higher earners, then it is easy to see why it does not fly too often. But as I have mentioned, the nuts and bolts would need to be scutinised in-depth. For instance, I proposed a 100% tax, or reducing it to 99.9%. That didn't wash with you, fair enough. But what about a 90% tax? In the US in the 1950's an era of great prosperity, a 90% tax was in place on incomes levels, adjusted for inflation of $3,400,000 a year or about €3m .


Firefly said:
Unless it was introduced at a global level it opens the door for the super-rich to relocate. Even if that vast majority of countries complied with your proposal those that remain outside the agreement would benefit handsomly.
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I don't necessarily agree. Ideally yes, or at least EU level. But if we are talking effectively about a tiny group of individuals, then I don't see how it makes any odds. Remember we are talking about personal income. Zukerberg, Gates, etc, etc don't live here so no odds. The only concern would be the people that currently reside here and it would be worth noting what it is they do to earn their incomes. Here is a sample list of professions that could possibly earning €2m +

Purple said:
You are talking about consultant doctors, solicitors, barristers,
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Each of which are actually reliant on the Irish market, on their Irish clientele in order to earn their living. It is simply not reasonable to assume a barrister earning €5m a year will head off the America and automatically start making that income for themselves once again. Even if they did, another capable barrister will fill the void. Furthermore, don't these people have families? Social contacts? Mortgages, school children....a high quality of life? Are you suggesting that they will all pack up and leave? So be it, the barrister who is earning €1m a year can pick up some of the slack and increase his/her income level to €2m - opportunities abound!
 
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Ha! Sounds like trickle down economics!! Very surprising for a socialst! Again, the devil would be in the detail.

TheBigShort said:
I've already said the proposal would be protected by legislation. There is nothing to stop any political party proposing we abandon the euro and instead trade in cabbage leaves - it wont get the political support.
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It would be a lot easier to reduce the 2m limit to 1m than to introduce a cabbage currency!


TheBigShort said:
This is setting a max income at a bar so high, that only around 300 are going to be directly affected. The other 99.985% of the working population will not be directly affected.
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So why really bother then? As you say, they can easliy live comfortably in 2m. They'll leave anything above 2m in their companies. The tax take won't change so is it just to a measure to bring them closer to everyone else for the sake of it?

TheBigShort said:
Given the level of opposition on this site for even proposing any form of increase on tax on higher earners, then it is easy to see why it does not fly too often.
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This is a relatively small site. I'm not sure even Venezuela in it's socilaist hey-day in Chavez's times even imposed a maximum income limit. Has this been implemented anywhere????

TheBigShort said:
I don't necessarily agree. Ideally yes, or at least EU level. But if we are talking effectively about a tiny group of individuals, then I don't see how it makes any odds.
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Again, why bother then?!



I'm not saying they would. Someone pulling in 2-3 million would probably just stay here and only take out 2m. Someone pulling in 20m could easily spend 181 days per year somewhere like Monaco or Portugal for tax purposes.
 
@BigShort. Once again (3rd time I believe), if you could be so kind:

You were asked "which country, say in Europe, most approximates this objective at the present time."

From you're post you mentioned Ireland. Is this correct?

Firefly.
 
TheBigShort said:
But realistically, would a house ever be worth €20,000,000 if it was known that nobody had access to greater than €2m a year? An income limit would put a downward pressure on over inflated asset prices.
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Non-resident Irish citizens or foreign Nationals would buy them up. Your proposal would just mean we'd have the same sort of people with the same sort of income but they wouldn't be Irish.

TheBigShort said:
If you don't put them to productive use, your competitor will. If the product is viable and marketable, someone, if not you, will take the opportunity. Isn't that the 'invisible hand'?
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No, it's not. The competitors would be in the same position.

TheBigShort said:
No, €2m is not an extreme level of wealth. It is a ball park figure. Raise it to €3m if you want. The point is, that it is certainly sufficient, attainable, but broadly out of reach for 99.985% of the population.
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It is a gross diminution of personal freedom for those lucky, smart or hard working enough to have very high incomes. We already take over half their income in tax. Beyond that it's just begrudgery.

TheBigShort said:
It only matters if it affects you directly. It makes no odds to me as I don't come anyway near it, nor likely to. It only affects some 300 people in Ireland. Raise the cap to €3m and you may only be talking about 50-100 people.
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If will never effect me but as a citizen I want all of us to have the same rights. Capping someones income is a diminution of their rights.

TheBigShort said:
So Fireflys notion that you wouldn't come in was wrong.
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No, you are incorrect. If I could end up with the same net income and only work 3 days then that's all I would do. At the moment when I work longer or harder the State takes over half of what I earn.

What' just like Apple do with the tens of billions they have parked in banks here and around the world?
 
Lots of people already Work Thur-Fri.and still end up getting the same as if they only worked 3 days and they are earning less than 100000 euro.lots of people would be better off not working at all but they still go out to work the World is a better place because they do so.
 
I agree. I'm one of them. I, like all those other people, get up early in the morning.
 
Firefly said:
Ha! Sounds like trickle down economics!! Very surprising for a socialst! Again, the devil would be in the detail.
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That depends on how you define or what your concept of socialism is. I have already outlined mine.

Firefly said:
It would be a lot easier to reduce the 2m limit to 1m than to introduce a cabbage currency!
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Either or, it would require political support. I would suggest a €1m income cap would have less political support than a €2m cap - I could be wrong of course, but that is my view nonetheless. The further reduction of incomes limits, I believe, would meet with ever increasing opposition.

Firefly said:
So why really bother then?
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To develop a social norm as to what is an acceptable level of acquired wealth. The purpose being to eradicate self-indulgent outlandish levels of income awarded by people in control of vast sums of wealth to themselves (see on You Tube, the Wells Fargo banking committee inquiry with John Stumpf and Senator Elizabeth Warren as a typical example). It will keep in check speculative asset bubbles that are hugely detrimental to the functioning of fair market open economies.

Firefly said:
This is a relatively small site. I'm not sure even Venezuela in it's socilaist hey-day in Chavez's times even imposed a maximum income limit. Has this been implemented anywhere????
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From Wiki

https://en.wikipedia.org/wiki/Maximum_wage#Maximum_liquid_wealth

There is an interesting paragraph on the History. Particular sectors of industries have implemented it. As I said a NFL footballer is maxed at $167m a year (not a great example, but nevertheless, the principle of imposing a cap is in place, and in the US of all places!!!)

Firefly said:
You were asked "which country, say in Europe, most approximates this objective at the present time."

From you're post you mentioned Ireland. Is this correct?
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I didn't propose Ireland as an answer, it was proposed to me. I suggested Ireland is one of (or a group of) the wealthiest and safest countries in the world.
I don't know the answer to the question, I don't have all the information to make such a comparable judgement. But in Ireland we do go some lengths to eradicate poverty, nevertheless, there are some serious failings.
 
Purple said:
Yes, that's the question.
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That doesn't make any sense. I am proposing a income limit on earning of €2m or more with a 100% tax. You are proposing, in your example, a 100% tax on income greater than €300 a week.
 
Purple said:
Non-resident Irish citizens or foreign Nationals would buy them up. Your proposal would just mean we'd have the same sort of people with the same sort of income but they wouldn't be Irish.
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How much would they pay for them? Knowing that, for instance, there would be, with an income limit, an effective ceiling on asset appreciation.

Purple said:
No, it's not. The competitors would be in the same position.
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You are assuming all your competitors are already earning €2m a year. This is simply not true. If you decide not to put your assets to productive use, where those assets have a viable use to generate income, a competitor, not earning €2m a year, will fill that void - at least according to the 'invisible hand' theory.

Purple said:
It is a gross diminution of personal freedom for those lucky, smart or hard working enough to have very high incomes.
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Anymore than an employer being forced to pay a minimum of €9.25ph?

Purple said:
If will never effect me but as a citizen I want all of us to have the same rights. Capping someones income is a diminution of their rights.
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Blocking someone's right to pay less than €9.25ph. Is that a gross diminution of their rights?

Purple said:
No, you are incorrect. If I could end up with the same net income and only work 3 days then that's all I would do. At the moment when I work longer or harder the State takes over half of what I earn.
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So you are talking about something else then, the current tax rates as imposed today. I'm not talking about that, I'm talking about something else.

Purple said:
What' just like Apple do with the tens of billions they have parked in banks here and around the world?
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Fair point, you have identified an anomaly. But nowhere did I say it was a panacea to eradicate gross accumulation of wealth. But Apple, Amazon, Facebook etc, are in the scheme of things, a small group of exceptionally profitable organisations that operate that way. It is a problem today, as it would be with income limits imposed. But at least we would, as a society, begin to move in a better direction.
 
TheBigShort said:
That depends on how you define or what your concept of socialism is. I have already outlined mine.
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That's a red herring. You are saying that the someone leaving money in their company's bank account would filter down to the general population. It has nothing to do with the brand of socialism. I only referred to socialism as socialists are generally against the idea of trickle down economics. Do you agree with trickle down economics then?


According to the Neri Institute only 12% of people earn more than 100k. It is not inconceivable then that that 100k could be the limit as it would not affect 88% of the population.

[broken link removed]




But the alternative is that the money is just kept in company bank accounts. As you have mentioned it is not to generate extra taxes so I am thinking Purple is correct - is this bourne out of plain old begrudgery?


TheBigShort said:
It will keep in check speculative asset bubbles that are hugely detrimental to the functioning of fair market open economies.
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Possibly. But it could also stifle real growth and development.

TheBigShort said:
Particular sectors of industries have implemented it. As I said a NFL footballer is maxed at $167m a year (not a great example, but nevertheless, the principle of imposing a cap is in place, and in the US of all places!!!)
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The NFL is privately owned via franchises. They have self-imposed those limits.


I think that's a cop-out to be fair. Based on what you do know, what country would most resemble the policy?
 
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Wasn't Steve Jobs salary only $1 a year. Company directors would just take 'loans' from their companies instead of salaries.

I think it would just create more tax exiles.
 
Firefly said:
You are saying that the someone leaving money in their company's bank account would filter down to the general population.
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In general terms, yes. In a competitive market, each competitor will pursue what it perceives to be it's best interest. A good R&D manager will pursue a bigger budget to innovate. A good Marketing manager will pursue better marketing strategies, a good maintenance man will hope to give the shop a lick of paint, with a bit of overtime thrown in.
All possible, by virtue of extra capital available in a well run company. Conversely, other a good Financial controller will seek to minimize budgets. It's all competitive, and a good General manager will live or die by decisions to invest while the money is there or to row back.

Firefly said:
I only referred to socialism as socialists are generally against the idea of trickle down economics. Do you agree with trickle down economics then?
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In general I do. But I can understand why socialists are against it. That is because what is euphemistically referred to as trickle down is actually quite the opposite. It's trickle up economics.
Hence the centralization of a wholly disproportionate amount of wealth into the hands of very few. If you want to call that trickle down, fair enough, I am opposed to it. I call it, trickle-up economics.

Firefly said:
According to the Neri Institute only 12% of people earn more than 100k. It is not inconceivable then that that 100k could be the limit as it would not affect 88% of the population.
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It is not inconceivable, are you proposing that? I am not.

Firefly said:
is this bourne out of plain old begrudgery?
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Not really, if I was begrudging, I'd set the limit a lot lower. But as stated, €2m was a ball park figure. It can go higher if need be.

Firefly said:
But it could also stifle real growth and development.
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Our current economic system can stifle real growth and development too.
If an income limit is showing to be the cause of stifling real growth. Raise the limit.
For arguments sake, between two sectors of the population, which do think will generate the most significant growth.
The 99.985% of population earning less than €2m a year, or the 0.015% earning more than€2m?

Firefly said:
The NFL is privately owned via franchises. They have self-imposed those limits.
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So what? I'm all for voluntary imposed limits. But in the absence of voluntary limits, legislation would be required.

Firefly said:
I think that's a cop-out to be fair. Based on what you do know, what country would most resemble the policy?
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Oh, ok, I will go with Sweden. How about you?
 
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losttheplot said:
Wasn't Steve Jobs salary only $1 a year. Company directors would just take 'loans' from their companies instead of salaries.

I think it would just create more tax exiles.
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Perhaps. But first, you would have to be earning €2m a year, otherwise why would you leave?
Second, there are only 300 or so of these people in Ireland.
Third, many of whom earn their income as professionals, reliant on the Irish market and their Irish clientele.
Fourth, people have built homes, families, social networks etc. Moving lick, stock and barrel is not always the obvious option.
Five, if you do have the capacity and will to become a tax exile, then, regardless of your income level or regardless of any income limit, why wouldn't you do it already?
 
TheBigShort said:
How much would they pay for them? Knowing that, for instance, there would be, with an income limit, an effective ceiling on asset appreciation.
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They would live in a different country but buy a home here and spend half their time living in it.

I disagree.

TheBigShort said:
Anymore than an employer being forced to pay a minimum of €9.25ph?

Blocking someone's right to pay less than €9.25ph. Is that a gross diminution of their rights?
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Do you see no difference between a floor and a ceiling? We don't have the right to employ young children, we don't have the right to discriminate against people etc.. To try to say that a minimum wage is comparable to a maximum income is a ridiculous false equivalency.



My answer to that is to ask you to read my post 377, four from the bottom of page 19.
 
TheBigShort said:
if you do have the capacity and will to become a tax exile, then, regardless of your income level or regardless of any income limit, why wouldn't you do it already?
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Because you want to live here and are willing to pay over half your income in taxes but are not willing to pay half it up to €2 million and everything above that level.

Tell me, will the value of pensions, defined benefit and defined contribution, be considered income in your model? If so you can add Judges to your list.
 
Purple said:
I disagree
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That's interesting, because what it says, if you can earn €3m, mon-fri, as a doctor, barrister etc you won't bother because of the €2m limit. So you will just work mon-wed and earn €2m. And that other doctor's, barristers, etc, earning less than €2m, won't see the opportunity to take up your slack on Thur-fri?

Purple said:
Do you see no difference between a floor and a ceiling?
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Yes, one helps me keep my feet on the ground, the other stops me from get too high and mighty.

Purple said:
We don't have the right to employ young children,
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Courtesy of legislation.

Purple said:
we don't have the right to discriminate against people etc.
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Courtesy of legislation.

I don't think income limit is one of the nine grounds of discrimination. So legislation enforcing an income limit is not discriminatory.

Purple said:
Because you want to live here and are willing to pay over half your income in taxes but are not willing to pay half it up to €2 million and everything above that level.
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So, out of the 300 people who earn over €2m, how many will become tax exiles?
 
So if the 3 specialists who can perform a specific operation or procedure don't work Thursday or Friday some others will just magically appear to cover those days?
People who earn at the top of their field usually do so for a reason.

TheBigShort said:
Yes, one helps me keep my feet on the ground, the other stops me from get too high and mighty.
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So you don't then.

TheBigShort said:
Courtesy of legislation.

I don't think income limit is one of the nine grounds of discrimination. So legislation enforcing an income limit is not discriminatory.
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That's a very interesting perspective; to you if something is not classified legally as discrimination it is not discrimination. I disagree, I think people have inalienable rights and legislation cannot change that. A good example of that is how until recently we discriminated against gay people. To me a arbitrary maximum income would be a form of discrimination. It doesn't matter how many or few people it effects; it is discrimination. The freedom of the individual is what our liberty is built on. To take that for granted would be folly.

TheBigShort said:
So, out of the 300 people who earn over €2m, how many will become tax exiles?
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Why does that matter?
 
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