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This Tax Law Professor Is Taking on the Super Rich


Business  (tags: tax law professor, Victor Fleischer, super rich, carried interest, founders' stock )

Sheryl
- 1049 days ago - truth-out.org
Most of Americas superest rich owe their exceedingly good fortune in life to the companies they founded. And most of these founders owe the immensity of their good fortune to the wink wink the tax code extends them at tax time.



   

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Comments

Sheryl G (359)
Sunday August 7, 2016, 12:38 pm
What about the argument that we as a society have to be willing to reward entrepreneurs for the risks they take? Lots of Americans, observes Fleischer, take risks -- and get no tax breaks for their risk taking.

"It is not self-evident," he writes, "why risk taking by rich executives and venture capitalists is more valuable than risk taking by, say, a Korean-American grocer, a Mexican-American restaurateur, a farmer in California, or an Uber driver in Miami."

"The current tax code," Fleischer sums up, "has become an echo chamber for the economic forces driving the increase in income and wealth inequality, the blurring of economic and political influence, and the degradation of paid work."
 

Alan Lambert (91)
Sunday August 7, 2016, 12:40 pm
The founder of a business should have *some* rewards, but not nearly as much as they are given by the tax code today. The carried Interest deduction should go away and the cap on FICA should also go away.
 

Kathleen M (208)
Sunday August 7, 2016, 12:52 pm
Hope this tax law Rock Star nails the entitled, greedy moochers to the wall! Thx Dandilion!
 

JL A (281)
Sunday August 7, 2016, 2:17 pm
Thanks for posting Dandelion--he makes great sense and Merkeley adding him to the team means some real progress is possible if the GOP loses control of the Senate.
 

Darren Woolsey (218)
Sunday August 7, 2016, 2:44 pm
Shared over social media to spread awareness.

Note that these exceedingly obscene amounts of money don't literally exist in the real world, but are "created" essentially on paper as creative financial constructs. Just as the tax loop holes that allow the subtle dodging of responsibility.
 

Sheryl G (359)
Sunday August 7, 2016, 3:04 pm
Thanks for the lead to the story JL A. Indeed Darren and that is what makes it all the more sinister.
 

Dawnie W (250)
Sunday August 7, 2016, 7:37 pm
❤️:-(())❤️Noted❤️
❤️Thanking you kindly for sharing this information❤️
💕💛ღ❤️Ƹ̵̡Ӝ̵̨̄Ʒ💕♥L💜ve, Hugs and Peace go with you all♥💕Ƹ̵̡Ӝ̵̨̄Ʒ❤️ღ💛💕
 

Animae C (509)
Sunday August 7, 2016, 10:17 pm
TY Dandelion
 

JL A (281)
Monday August 8, 2016, 11:12 am
Copy of email extracts from Americans for Tax Fairness:
"Now through Election Day, candidates for the U.S. House of Representatives and the U.S. Senate are hitting the campaign trail to vie for your vote. Americans for Tax Fairness Action Fund has created four important questions (and answers) for you to ask your candidates.

QUESTIONS:

U.S. corporations have stashed $2.4 trillion in profits offshore – mostly in tax havens – and have paid no U.S. taxes on those profits. Do you support requiring U.S. corporations to pay the $700 billion in taxes they owe on those profits?
Should people who make their income from Wall Street investments pay the same tax rate as people who work for a living and get paid a salary or a wage?
Do you support a Wall Street Speculation Tax, which would assess a tiny tax on the sale of stocks and bonds and raise at least $400 billion to invest in America?
Do you oppose Donald Trump’s tax plan, which would give the richest 1% an average tax cut of $275,000 per year?

This election is about the kind of future we want for our country. Do we want one dominated by Washington corporate lobbyists and wealthy special interests? Or do we want an economy that works for all of us, where the wealthy and corporations pay their fair share of taxes so we can remedy growing inequality and ensure opportunity for all?
...
" ANSWERS:

Under federal law, corporations owe U.S. taxes on the profits they hold offshore, but they are allowed to defer payment indefinitely. This is a huge tax break that encourages multinational corporations to shift profits—and U.S. jobs—offshore. A major corporate lobbying campaign is pushing Congress to pass legislation that would let corporations pay a tax rate of 10% or less on their $2.4 trillion in offshore profits, compared with the 35% they owe. It is outrageous that Congress would consider such a giveaway. Most domestic corporations—including Main Street businesses—pay the full tax rate, or close to it. They cannot and do not shift profits offshore. You and I are not able to get a special tax break on our wages or salaries. Big corporations should not live by a special set of tax rules. They should pay the $700 billion they owe, according to Citizens for Tax Justice.
The top federal tax rate on income from salaries and wages is 40%. But the top tax rate on income from investments, such as capital gains and dividends, is just 24%, or about half as much. This is the main reason billionaire investor Warren Buffett famously complained that he paid a lower tax rate than his secretary. This Wall Street investment tax break overwhelmingly benefits millionaires – they get three-quarters of the tax savings. It is time the rich started paying their fair share of taxes. The place to start is by having them pay the same tax rate on their investments as they would pay if they were getting a salary or paid wages like the rest of us. This could raise more than $100 billion a year.
A small tax on the trading of Wall Street financial instruments—stocks, bonds and dividends—could raise tens of billions of dollars per year of badly needed revenue, mostly paid by the Wall Street traders who are buying and selling every day. Because it would affect high-volume, high-speed computer trading the most, it would reduce the type of trading that makes the economy vulnerable to financial crashes. Adopting a Wall Street Speculation Tax would help return Wall Street to its proper role of financing long-term investments that create good jobs, instead of engaging in short-term speculation that pressures companies to downsize and outsource jobs.
Donald Trump’s tax plan is a huge giveaway to the rich and big corporations. Trump slashes the top tax rate paid by the rich. That means the richest 1% get a tax cut of $275,000 a year. Billionaires like Trump will get a tax break of at least $1.3 million a year. Trump made lobbyists happy by cutting the corporate tax rate by more than half – from 35% to 15%. This will cut corporate taxes by more than $2 trillion over the next 10 years. Corporations should pay more in taxes, not less. Overall, Trump’s tax plan loses nearly $10 trillion in revenue. The only way he can pay for those tax breaks is by slashing spending for Social Security, Medicare and every other benefit or service the federal government provides people and communities.

These are critical issues that the American people deserve answers on.

Will our candidates and elected officials stand with us or Wall Street?

Will they enact a tax system that treats taxpayers fairly or continues to enrich the wealthy and large corporations?

Will they raise the tax dollars necessary to make critical investments here at home, or allow multinational corporations to continue stashing obscene untaxed profits offshore? "
 

Janet B (0)
Monday August 8, 2016, 1:03 pm
Thanks
 

Birgit W (160)
Monday August 8, 2016, 1:13 pm
Darren says it all. Thanks for sharing.
 

Lois Jordan (63)
Monday August 8, 2016, 3:41 pm
Noted. Thanks, Dandelion.

Fantastic that Wyden hired him; now we just need the "right" Dem. Senate to be elected.....Senators willing to take this on and aren't beholden to those who oppose this.

It was nearly unbelievable to read: "Private equity kingpins raise funds from investors to buy and sell companies. They typically keep for themselves 20 percent of the profits from all their wheeling and dealing." "....the carried interest loophole lets private equity movers and shakers claim this income as a capital gain, a label that saves them about $160,000 in taxes on every $1 million they rack up."

"Extremely rich people get to avoid paying standard tax rates on the vast bulk of their income."

 

Sheryl G (359)
Monday August 8, 2016, 5:44 pm
Many years ago I watched a 60 Minutes program where a man took one of those reporters around his estate. He had a huge home, he had beautiful horses running in the paddock, he had an airplane hangar along with the airplane, he had numerous cars of high value, swimming pool, lots of land, vacation homes, he was very well off.

When he was asked how much he paid in taxes he said nothing, the reporter asked again, you said nothing is that correct, he said that is correct, nothing, zero, not one shiny dime. I thought of my Mother working in a sweatshop for peanuts and she worked hard all her life, when she retired she was only making $9.80 the most she'd ever made. Yet she paid taxes all along the way, she never got to own her own home, she was lucky to own her own car so she could drive to work each day.

That was a long time ago I watched that program and here we are DECADES later and it has only grown worse not better. The poor working in Walmart, McDonald's, and the like all pay taxes, and yet these well to do with everything pay nothing. The Reporter asked him if he was afraid to say that on TV he said no as he had done nothing illegal. He said if the tax codes are going to allow him to do what he does he'll take it.

Few seem to complain about that but let a woman down on her luck receive some food stamps for herself and children and that is a mortal sin it seems.
 

Freya H (345)
Monday August 8, 2016, 7:20 pm
Way to go, Victor Fleischer! We need a lot more people like you. Let us support his crusade however we can.
 

Past Member (0)
Monday August 8, 2016, 7:30 pm
D wrote: "I thought of my Mother working in a sweatshop for peanuts and she worked hard all her life, when she retired she was only making $9.80 the most she'd ever made. Yet she paid taxes all along the way...."

Same with my Father....he worked very hard and paid his taxes all along the way. But the Reptiles in Congress, on Wall Street, and the very wealthy have skirted around paying what they REALLY owe in taxes for generations, and few seem to complain.

"When he was asked how much he paid in taxes he said nothing, the reporter asked again, you said nothing is that correct, he said that is correct, nothing, zero, not one shiny dime."

70,000 page tax code?! Are you serious? That tells you it's a scam of mega proportions. Also, It's a fact nobody (not even the specialists) truly understand all of it. Why is it so long?? Simple, it needs to be that long, vague, obscure, and ambiguous to hide the Fascism that's going one between our government and its "free" enterprise economy. That is its real purpose: To Hide the Fascism NOT offer official guidance to proper taxation.


 

JL A (281)
Monday August 8, 2016, 8:28 pm
And, Randy, the foundational premise of the tax code is to provide incentives to be in business--which made sense when corporations had to disband at the end of each project but now....
 

Colleen L (3)
Tuesday August 9, 2016, 12:01 am
Agree with Darren. Thanks Dandelion
 

Sue L (73)
Tuesday August 9, 2016, 9:41 am
Hooray! I can FINALLY send green stars for comments on C2NN articles! This is why we need to keep pushing to change the tax laws so the super rich pay their fair share. We all need to start pestering our Congress to do something about this injustice. Right now all the info is still coming out about all the breaks that the 1% get. The next step is to take action and demand change.
 

Sheryl G (359)
Tuesday August 9, 2016, 12:07 pm
Glad things are working better for you Sue and I agree with the rest of what you wrote.
 

Lenore K (0)
Tuesday August 9, 2016, 5:02 pm
ty
 

Mandi T (367)
Tuesday August 9, 2016, 5:51 pm
Yep, Sue... Tks Sheryl
 

Robert B (55)
Tuesday August 9, 2016, 7:57 pm
Without the support of the the middle class, the small individual businesses and the publicly funded infrastructure, there would be no 1%. The wealthy Must share the load and pay up their FAIR SHARE and guess what? They will STILL be wealthy. Their best insurance to STAY wealthy is to pay to support the system by paying up. NO MORE LOOPHOLES!
 

Rose Becke (141)
Tuesday August 9, 2016, 10:16 pm
True Darren
 

Jonathan Harper (0)
Wednesday August 10, 2016, 12:42 am
Noted!
 

Darren Woolsey (218)
Wednesday August 10, 2016, 2:02 am
Reshared original article Dandelion posted, over social media to spread awareness.
 

Evelyn B (63)
Wednesday August 10, 2016, 2:19 am
But when one closes the tax loops, those wealthy skip the country ... rather than have to contribute more.
And this is the reasoning used by those resisting closure of loops.

I agree, Robert - As though the moneys left over AFTER tax wouldn't be more than sufficient for maintaining the same life style ... But all they see is the money they "lose", not what they keep.
And, of course, they are quick to consider those who struggle to meet basic needs (not the luxuries) as "lazy" ... and the very rich object to helping "lazy" people ... while they & their families often loll about on Caribbean islands, luxury yachts, vast estates ...

Good luck to Victor Fleischer!
 

SuSanne P (193)
Wednesday August 10, 2016, 7:04 am
Thank you Dandelion as I saw this sometime this week. Amazing!
 

Winn Adams (179)
Wednesday August 10, 2016, 7:21 am
Thanks Sheryl and Darren!!!
 

Past Member (0)
Wednesday August 10, 2016, 10:03 am
Evelyn B. wrote: "But when one closes the tax loops, those wealthy skip the country ... rather than have to contribute more. And this is the reasoning used by those resisting closure of loops"

Yes, that's right and I've been hearing that for decades and there's an answer for it: If you (rich person) want to skip the country, okay, than here's the deal, you and your family go with you, you all must relinquish your passports and citizenship to USA. Any and all business ties/imports-exports/financial banking services etc..will be stopped and you will be given 90 days to transfer all funds out of the country. You and your family will not be allowed to own any land in USA or reenter. All ties with the USA will be cut.

Oh, and have a nice day! ;-)

 

Sheryl G (359)
Wednesday August 10, 2016, 11:18 am
Or we can tax the people from their Country of birth and the company is taxed where it was started. It would not matter if they moved the company to India or wherever they still pay taxes based in USA. They may get a cheap labor pool but International Unions should work at raising all wages to living wages for that particular Country but taxes still remain with the Country of origin. And close those darn loopholes and better oversight upon the overall tax system so it is fair for all, not just the 1%.
 

Janet B (0)
Wednesday August 10, 2016, 12:22 pm
Thanks
 

Debra Y (5)
Wednesday August 10, 2016, 12:45 pm
Thank you!
 

Roger G (148)
Wednesday August 10, 2016, 1:12 pm
noted, thanks
 

Arild Warud (174)
Thursday August 11, 2016, 7:02 am
"Welcome to Capitol Hill, Victor Fleischer. We need you there."
 

Margie FOURIE (148)
Sunday August 14, 2016, 12:15 pm
Thank you
 

Maryann S (112)
Monday August 15, 2016, 5:21 pm
Thanks for sharing Dandelion.
 

Past Member (0)
Wednesday August 17, 2016, 11:27 am
Thanks Dandelion. More ugly American truth that has never been hidden--and will take a revolution to correct.
 

Darren Woolsey (218)
Wednesday August 17, 2016, 2:53 pm
Yes, sorely needed. . .
 
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