why is raising taxes on the rich and corporations bad?

[dillo]

A lot of the theory has to do with risk as an entrepreneur an investment looks like this

%success x payoff of success - %failure x cost of investment= Expected Value of investment

increasing taxes decreases the payoff of success which in turn lowers the expected value of the investment

[Zippyjuan]

Everybody shares in government so should't everybody have to pay for it? A flat tax percent applied to everybody with no deductions and no exclusions would be the "fairest". But the government has tried to use tax policy to try to encourage (or discourage) certain types of behavior. They think people should own a house so they allow them to deduct the interest they pay on a loan they took out to buy a house. They think people should use less energy so the add a tax onto gasoline. These distort the resulting real (average) tax rates for people. Those at higher incomes are better able to utilize deductions so if you want to flatten out the true average rate then you need a higher marginal tax rate on higher incomes.

If you don't pay your own share of government costs, you may demand more services from government since somebody else will be paying them for you. This encourages a bigger government and higher taxes for everybody. If everybody is required to pay their share, they will tend to demand less and have a theoretically smaller government. Theoretically- not necessarily in reality.

[Acala]

Everybody shares in government so should't everybody have to pay for it?.

As long as I can opt out if I want. If government is such a great thing, then people, when given a real choice, should generally decide that the benefits outweigh the burdens and opt in. The problems start when governments can force people to participate in their little game. That's when it stops being about everyone enjoying the benefits of delegating certain joint function to an agent and starts being about one group plundering the property and freedom of others.

As long as my "share" of government is actually being rammed down my throat, then, no, I don't feel any obligation whatsoever to help pay for it.

[CT4Liberty]

I agree with the rest of your post but I'm going to disagree that ALL taxes are theft. My point of view is that free men and women rationally consent to the protection of their freedom. And so we consent to the minimum amount of our property taken required for the protection of our freedom. That means a small and efficient government that taxes little, and provides a military, police force, fair and just judicial system, and emergency services.

Of course we are a long, long way from that level of government and taxation, and people will have to slowly be weaned off government dependency, and it will come in little steps probably instead of big leaps. But that is my view of the role of government, and I believe that free people do rationally consent to that level of government for the protection of their freedom.

I do view all taxes as theft... someone made the analogy earlier. If someone came in and robbed your house, that is theft. If they hire a couple of goons to rob your house, that is still theft. If those two goons had the 3 of you vote on if its ok for them to take your TV and you lost 2-1, that is still left. If the government does it...its still theft.

I would be interested to know what taxes arent theft? It sounds more like you are referring to the amount taken, rather than the way its taken. If I am starving and I steal a loaf of bread, just enough to survive but leave the rest, is that not still theft? Sure, I didnt go overboard and steal all the food, but I still stole.

As I mentioned, certain taxes are more or less overtly immoral than others, but that doesnt change the fact that the government uses force to take something that isnt theirs in the first place...that is the definition of theft.

[awake]

Instead, why don't we raise taxes on the individuals who earn their income by the State? This would of course mean lowering all their incomes. Raise taxes on the wealthy - the state!

[amy31416]

Somehow I doubt the OP will even read this, but when you give gov't more money (power) it is used for unethical things, like war, suppressing people (drug war, police state) and rarely used for things that liberals deem "good" like welfare or education.

Do you that that Barack "Drones!" Obama is going to help the downtrodden with this money? I don't.

[TheGrinchWhoStoleDC]

i just want to understand the libertarian perspective more and see how i'm wrong. so i hear a lot opf conservatives and libertarians say like if we raise the taxes on the rich and on corporations they will leave or cut back or whatever but how come when the taxes were high before , like it was almost like 90% on them, they didn't leave? what makes you think they will leave now? and even if they do leave so what? that leaves room for new businesses.

besides they only pay tax on profits and not revenue, the reason they dont create jobs is because profit demand isnt there right?

tell me how i'm wrong

"and even if they do leave, so what? that leaves room for new businesses"

Ummm, no it doesn't. Just because they outsource production does not mean that the company doesn't still exist and sell here, and in fact, they will have a strategic advantage of cheaper production than the competing companies you're talking about.

Further, the point is that no one should have to pay drastically mroe than anyone else jsut because they have the means. In fact, having the means already means they pay far more just with a flat tax.

[LibertyEagle]

The government's debt is not because they don't have enough money. It is because they spend way too much. The solution is not to turnaround and increase taxes of anyone. Much less the small businesses that create the vast majority of the jobs in this country.

[puppetmaster]

Here's another (liberals usually get this one):

Corporations do not pay taxes. They just add it to the prices they charge for their products so the consumer ends up paying more. When the things that the middle class and poor buy cost more, they can buy fewer things. When they buy fewer things, the economy slows down.


Ok, so you have heard some utilitarian arguments, some moral arguments, and some real life examples. Are you convinced yet that this philosophy of "just make the rich pay more" is flawed?

This is correct. There are also many other problems with corporations as a whole but this sums up an area in easy to understand terms

[TheGrinchWhoStoleDC]

Well, I voted for Gary Johnson who would like to toss out the crazy income tax code and have a Fair consumption tax.

Personally I think a consumption tax is a terrible solution, as people who make less will see far more of their money taken to non-discretionary spending (in other words, necessities), and those on the fringe of lower-class will have much less discretionary income to spend as they please. It is only those with the means who will beneift from that system, when the goal should be a more "fair" system (if there is such a thing).

Further, as much as I dislike having an economy driven on consumption rather than production, we would need much more of a shift than just tax breaks to return to a production-based economy where consumption is not so vital to keeping the economy moving.