Estate Tax and Government Revenue

[Sunstruck-Eden]

Hello all!

So, I was debating with a few people in the philosophy club at my school about Ron Paul's stance on taxes and everyone was railing that while no taxes was ideal, taxes are necessary for government revenue. They also asked me about the estate tax (which I didn't even know existed until now). They said that if there were no estate tax, children could just inherit their parent's wealth and start an oligarchy in America through the next few generations, if the estate tax were to be abolished. I tried telling them that Ron Paul believes that taxes are a a restriction on our freedoms and that envy is the source for these taxes in the first place, but they insisted that since the person was dead, they were in no longer in need of their wealth and should pass it on to others through the funding stuff for the states/federal government. They believe their children should not recieve their wealth and should make their own money on their own merit.

Also, they asked me what the federal revenue would be if all taxes were eliminated and I'll be honest, I'm not really sure. Could you guys help me out so I can tell them at the next meeting?

But, as you see, this is yet another really obscure question thrown in to undermine libretarianism that I'm sure could be asked to Ron Paul in a debate. You wouldn't believe some of the stuff these so-called "philosophers" came up with. One person even said that the illiteracy percentage would increase tenfold in a libretarian society and that it wasn't the national guards job to help out in emergencies. I mean, really?

[Weston White]

Although a bit late now, I will reply for future reference:

Of course, taxation is necessary for whatever form of government to function properly, while to that same end there is a very fine line that should not (however tempting) be crossed by those possessing such powers of taxation. All means of taxation ought only to be imposed strictly under prudence.

Ron Paul is not against taxation, per se, he is against all illegal (i.e., unconstitutional) or otherwise unjust taxation, such as the status quo perception of the federal income tax as it applies to the general populace; more than that he is against ramped fraud that is our nonconvertible (fiat) paper currency and the Federal Reserve System -which is wholly dependant upon the continuance of the perception as by the status quo, i.e., the presently mandated stoppage at the source withholding scheme.

As to America becoming an oligarchy because of a lack of taxation, well quite honestly, America has already become an oligarchy, largely because of too much taxation. Pointedly, over-taxation, in other words, taxation imposed beyond governmental necessity (i.e., prudence) is simply a kinder name for what is mandated conversion (i.e., robbery), or the legalization of transferring wealth from one class of society to another (i.e., the classical have-nots versus the must-have-it-alls). What we are really discussing is progressivism, which is the complied legalization of actions that if were not for the decree of public law would be downright unconscionable, and in any case should remain inconceivable -at least in a commonwealth republic, such having been founded on Christian theology.

Even today, most accomplished economists agree that the federal government should be wholly capable of sustaining itself without issue on somewhere between $400-$600 billion per year. The fact the it now requires several trillions in taxes and even still advances its own national debt by many more trillions, serves as being self-evident to its total, unabashed, through-and-through corruption.

As to estate taxes, such is a proper means of taxation, provided the rates of the tax remain reasonable (i.e., 10% and beyond is simply ridiculous), while this method of taxation in itself bears absolutely no connection in enveloping an oligarchy.

The individual federal income tax aside, there remains, yet countless other modes or methods of taxation in operation, in many instances largely effecting double, triple, and quadruple taxation from a single source, all varying application within the governmental realms of national, state, and local.

Studies have shown that those who are liberty conscience, although fewer in numbers, possess vastly more intellect and self-awareness than the combined average of both Democratic and Republican Party members. Moreover, studies have also shown that public education and acts such as “No Child Left Behind Act” (NCLB) have dismally failed. So to state that Libertarians (i.e., Constitutionalists), if heeded to, will cause the downfall of the very society from which was founded on those very beliefs now being opposed (largely by individuals that do not possess even a basic concept of those very fundaments, maxims, and principles) is without any merit, whatsoever.

The National Guard serves our United States of America as its organized militia, and yes they are to be called upon, as it is their sworn duty to serve, for either qualifying state or national emergencies and to repel all means of foreign invasion.


Additionally concerning the estate tax see:

Collections from the estate tax only realized the IRS a pale ~$17-billion: http://www.irs.gov/taxstats/article/...102886,00.html

Bracket rates for the estate tax are on page 4 of: http://www.irs.gov/pub/irs-pdf/i706.pdf

And data respective to taxation in general: http://www.taxfoundation.org/research/show/22287.html

[Wags]

Government gets a little over half of its revenue from indirect taxes, which sales and excise fall under. Direct taxes, like the income tax and the estate tax, are what Ron Paul wants to get rid of because these are direct taxes on individuals.

I'm not an economist, but that's how I understand the situation.

They said that if there were no estate tax, children could just inherit their parent's wealth and start an oligarchy in America through the next few generations, if the estate tax were to be abolished. I tried telling them that Ron Paul believes that taxes are a a restriction on our freedoms and that envy is the source for these taxes in the first place, but they insisted that since the person was dead, they were in no longer in need of their wealth and should pass it on to others through the funding stuff for the states/federal government.

As far as I'm concerned, you have every right to pass down your wealth and assets however you want and to whoever you want. If you do not have this right, then that property is not really yours, it's the government's.

If a family is trying to create wealth for present and future descendants, I don't think pushing taxes on them can stop them. A lot of people move or evade it. But I think the idea that we'll suddenly start seeing oligarchies pop up if we removed the estate tax is a little silly.

Also, if you want the man's take on it himself:

The real motivation behind the estate tax is a deep-seated hostility to property rights, and a misguided fear of family dynasties. But people don't keep money in mattresses anymore. Money inherited from an estate is either spent, saved, or invested — all of which are better for the economy than sending it to Washington, where bureaucratic overhead consumes at least 50 cents of every dollar.

Sorry for replying a year late :b

[redbluepill]

Want to limit taxes? Then go with the Single Tax aka the Land Value Tax. Libertarians/classical liberals including Thomas Jefferson, Thomas Paine, Albert Jay Nock, Frank Chodorov, and Milton Friedman have advocated it as either the least evil tax or only moral tax.

http://www.landvaluetax.org/what-is-lvt/
http://www.savingcommunities.org/

[Zippyjuan]

Government gets a little over half of its revenue from indirect taxes, which sales and excise fall under. Direct taxes, like the income tax and the estate tax, are what Ron Paul wants to get rid of because these are direct taxes on individuals.

I'm not an economist, but that's how I understand the situation.



As far as I'm concerned, you have every right to pass down your wealth and assets however you want and to whoever you want. If you do not have this right, then that property is not really yours, it's the government's.

If a family is trying to create wealth for present and future descendants, I don't think pushing taxes on them can stop them. A lot of people move or evade it. But I think the idea that we'll suddenly start seeing oligarchies pop up if we removed the estate tax is a little silly.

Also, if you want the man's take on it himself:


Sorry for replying a year late :b

The FEDERAL government gets most of its revenue from the income tax. It is state and local governments which collect sales taxes. Excises taxes are also small portions of Federal taxation. Figures for 2009:
http://en.wikipedia.org/wiki/2009_Un...federal_budget

$1.21 trillion – Individual income tax
$949.4 billion – Social Security and other payroll taxes
$339.2 billion – Corporate income tax
$68.9 billion – Excise taxes
$29.1 billion – Customs duties
$26.3 billion – Estate and gift taxes
$47.9 billion – Other

As can be seen, Estate taxes (plus other gift taxes) account for about one percent of their revenues.

[cheapseats]

Can we agree that ILL-GOTTEN GAINS were amassed during the "great" Mortgage Meltdown, Derivative Debacle & Bailout Bonanza of the "new" millennium?

America had 400-something Billionaires BEFORE the manmade Financial "Crisis", and 700-some AFTERWARD. Congressional net worth INCREASED. More than half of Congress, "representatives" of We The People, are Millionaires.

One surplus America definitely runs is PROFITEERS WITHOUT ETHICS.

Arguing for conscienceless Robber Barons and corrupt Officials to be able to pass every purloined penny to stroke-of-luck offspring who are ALREADY steeped in incredible Advantage is $#@!in' PERVERSE.

"Misguided fear of family dynasties", fiddle dee dee.

PLATO called it, that man apprehends advantage in injustice.

OF COURSE theories work in theory. Who the hell subscribes to theories that don't even work IN THEORY?

Theory and Reality do not goose-step even in Ordinary Times. It cannot have escaped the notice even of people whose heads are buried in theory that THESE ARE NOT ORDINARY TIMES.

Congress is gridlocked? SO ARE THE PEOPLE. Therefore, "naturally", we all slide in the direction that the greater Force sets.

Money = Power.

House of Medici: "MONEY TO GET POWER, POWER TO PROTECT MONEY."

[Wags]

The FEDERAL government gets most of its revenue from the income tax. It is state and local governments which collect sales taxes. Excises taxes are also small portions of Federal taxation. Figures for 2009:
http://en.wikipedia.org/wiki/2009_Un...federal_budget


As can be seen, Estate taxes (plus other gift taxes) account for about one percent of their revenues.

I've seen sources that suggest differently, but I'm not interested in finding accurate statistics. The issue is whether governments taxing the individual in order to amass a certain revenue is justified.

[Danke]

Government gets a little over half of its revenue from indirect taxes, which sales and excise fall under. Direct taxes, like the income tax and the estate tax, are what Ron Paul wants to get rid of because these are direct taxes on individuals.

Correction. The Income Tax is indeed an indirect tax. It is a tax on a (federal) privileged activity. Hard to phantom for most folks, but that is how it has always been all the way back to 1862.

[Sonny Tufts]

Correction. The Income Tax is indeed an indirect tax. It is a tax on a (federal) privileged activity. Hard to phantom [sic] for most folks, but that is how it has always been all the way back to 1862.

It's true that neither the income tax nor the estate tax is a direct tax in the constitutional sense. It is false that some kind of privilege, federal or otherwise, must be involved in connection with the income tax. Aside from the fact that the courts have consistently rejected the argument that the income tax is based upon engaging in "privileged activity", consider: income obtained from illegal activities such as embezzlement, extortion, and bootlegging is taxable (court citations available on request). Where is the federal privilege in embezzlement or in any other activity that, far from being privileged, is specifically forbidden?

[Wags]

The Income Tax is indeed an indirect tax.

Right. In the constitutional sense.

In the constitutional sense, levying an income tax is also considered moral.