Tax the rich

Monty Burnz · 09-09-2012 12:08pm #1

France's richest man has applied for Belgian nationality – as the Socialist government in his home country raises the tax rate to 75 per cent.
The announcement by Bernard Arnault, who is worth a conservative 30 billion pounds, comes after President Francois Hollande admitted that he ‘dislikes the rich’.

I wonder how much tax income France will lose when this guy and thousands of others figure that the government taking three quarters of their earnings is just a bit too much?

Will any of our ULA/SF friends here explain why the same would not happen here under their "tax the rich" proposals? Especially considering that Irish people have even greater mobility than the French, able to work in the US, Canada, NZ, Aus, UK, India etc.

Please not I am not talking about the moral/ideological aspect of this - just the pragmatic view.

phelixoflaherty · 09-09-2012 12:10pm

Lets tax the wages of sin.

johnnyskeleton · 09-09-2012 12:31pm

Surely if you are to start the thread on the topic you should do your own research into how much France will lose by this, no? Maybe nothing, maybe a lot. But you cantjust assume it is bad without proof and expect that to be sufficient to get a response from others

Monty Burnz · 09-09-2012 12:34pm

johnnyskeleton wrote: »

Surely if you are to start the thread on the topic you should do your own research into how much France will lose by this, no? Maybe nothing, maybe a lot. But you cantjust assume it is bad without proof and expect that to be sufficient to get a response from others

I'm not asking how much France will lose, I am asking what makes SF/ULA supporters believe that the wealthy and the educated won't leave here.

Well?

Gumbo · 09-09-2012 2:05pm

Monty Burnz wrote: »

I'm not asking how much France will lose, I am asking what makes SF/ULA supporters believe that the wealthy and the educated won't leave here.

Well?

we havent got many people in this state paying our taxes thats worth 30Bn i would imagine.

Count Dooku · 09-09-2012 2:16pm

kceire wrote: »

Monty Burnz wrote: »

I'm not asking how much France will lose, I am asking what makes SF/ULA supporters believe that the wealthy and the educated won't leave here.

Well?

we havent got many people in this state paying our taxes thats worth 30Bn i would imagine.

Everything is relative, top 10% pay 50% of taxes, if they will leave, then poor will have to pay much more

Monty Burnz · 09-09-2012 2:18pm

kceire wrote: »

we havent got many people in this state paying our taxes thats worth 30Bn i would imagine.

Probably not, but of course that's not what I'm talking about.

Why would the wealthy and high-earners stay here when there are so many other places they could easily live?

KyussBishop · 09-09-2012 2:46pm

Heh, this is a recurring fallacy which is so weak, that every time it is brought up no bad consequences are stated, just that "they'll leave" with the implication that it's a bad thing; what exact bad events will happen? (and back them up with proof)

We're talking about income tax here, not corporation tax; it's not like an entire company is going to up and leave, causing a large loss of jobs, just one person whose job opening will soon be filled by someone else, causing no loss in tax intake.

Past a certain income bracket, we would mostly be talking about overpaid management/executive positions at large companies as well; these are pretty heavily invested job positions, taking significant time to move up the ladder (and usually easily replaceable), so there aren't exactly going to be similarly paying jobs waiting for them as soon as they move to another country.

The general crux of the fallacy is that the jobs will leave, and there's just no proof of this at all.

Monty Burnz · 09-09-2012 2:51pm

Is any SF/ULA supporter willing to address the question I am asking, rather than positing other questions they would much prefer I asked?

KyussBishop · 09-09-2012 3:05pm

Your question is loaded for starters, both in implying that high-earners leaving is a bad thing, and also in implying that anyone who argues against your point of view is supportive of SF/ULA.

If you're not looking to answer questions countering your argument, then this isn't a discussion but is soapboxing instead (I'd nearly call it an attempt at trolling, but you appear to want to be taken seriously; that to me, is part of the defining line between trolling and soapboxing).

ResearchWill · 09-09-2012 3:08pm

Count Dooku wrote: »

Everything is relative, top 10% pay 50% of taxes, if they will leave, then poor will have to pay much more

I read recently need to find it again, that less than 12,000 people in this state pay 18% of the income tax collected. That scarry.

http://www.ronanlyons.com/2009/07/28/a-little-quiz-on-irelands-income-tax/

Monty Burnz · 09-09-2012 3:08pm

KyussBishop wrote: »

Your question is loaded for starters, both in implying that high-earners leaving is a bad thing, and also in implying that anyone who argues against your point of view is supportive of SF/ULA.

If you're not looking to answer questions countering your argument, then this isn't a discussion but is soapboxing instead.

You are desperate to move the discussion onto another point - the consequences of wealthy people leaving the country. If you want to start a thread on that, please go ahead.

I am trying to establish whether there is any serious argument can be made that claims that wealthy people would not leave if taxes for the wealthy were substantially increase.

I take it that you have no such argument to make - a simple admission of that would be fine.

ResearchWill · 09-09-2012 3:15pm

Count Dooku wrote: »

Everything is relative, top 10% pay 50% of taxes, if they will leave, then poor will have to pay much more

Monty Burnz wrote: »

You are desperate to move the discussion onto another point - the consequences of wealthy people leaving the country. If you want to start a thread on that, please go ahead.

I am trying to establish whether there is any serious argument can be made that claims that wealthy people would not leave if taxes for the wealthy were substantially increase.

I take it that you have no such argument to make - a simple admission of that would be fine.

I suppose the answer depends on how each of the wealthy earn their income, if I earn a million a year from a business based in monaco then ya I would prob leave. If on the other hand I earn a million a year working as say a consultant doctor then moving gives me no advantage as its difficult to work in Ireland based in France.

southsiderosie · 09-09-2012 3:56pm

Monty Burnz wrote: »

Will any of our ULA/SF friends here explain why the same would not happen here under their "tax the rich" proposals? Especially considering that Irish people have even greater mobility than the French, able to work in the US, Canada, NZ, Aus, UK, India etc.

Please not I am not talking about the moral/ideological aspect of this - just the pragmatic view.

Monty Burnz wrote: »

I'm not asking how much France will lose, I am asking what makes SF/ULA supporters believe that the wealthy and the educated won't leave here.

Well?

Monty Burnz wrote: »

Is any SF/ULA supporter willing to address the question I am asking, rather than positing other questions they would much prefer I asked?

MOD NOTE:

OP, I think you've asked an interesting question, but why would you expect SF/ULA supporters to engage with you given the tone of these posts? Because to be honest, given these posts, it is hard to tell if you want an honest discussion of tax policy, or are just looking to take potshots at SF/ULA supporters...and the multiple "Well? Well? posts on the first page on this thread are veering into soapboxing territory.

I think it is possible to have a discussion of fiscal policy, and even how some parties view fiscal policy, without badgering people - especially since this thread has not been open for that long.

KyussBishop · 09-09-2012 4:11pm

Accepting the limited frame of the debate "will some high earners leave?" (even though it's difficult to determine the value of an answer to that, when we appear to be ignoring the consequences), then it's pretty obvious that yes, some will leave.
It could be as little as 0.1% of people affected by the tax increase, but yes some of them will probably leave; there doesn't seem to be a way to quantify how many will, just that 'some' will.

Where to go from there though, when discussing consequences is out of the range of the debate?

Monty Burnz · 09-09-2012 4:20pm

southsiderosie wrote: »

[
OP, I think you've asked an interesting question, but why would you expect SF/ULA supporters to engage with you given the tone of these posts? Because to be honest, given these posts, it is hard to tell if you want an honest discussion of tax policy, or are just looking to take potshots at SF/ULA supporters...and the multiple "Well? Well? posts on the first page on this thread are veering into soapboxing territory.

The reason for what you characterise as the 'well? well?' posts is that I am interested in discussing a particular point. I clearly outline this in the first post. The first couple of responses immediately (by accident or by design) tried to steer the discussion onto another point and I attempted to steer the discussion back onto the question I am interested in.

I hope that clarifies the position.

kupus · 09-09-2012 4:22pm

Whats the point in taxing them, they only get their lawyers to find loopholes anyway

End of discussion.

johnnyskeleton · 09-09-2012 4:22pm

Monty Burnz wrote: »

johnnyskeleton wrote: »

Surely if you are to start the thread on the topic you should do your own research into how much France will lose by this, no? Maybe nothing, maybe a lot. But you cantjust assume it is bad without proof and expect that to be sufficient to get a response from others

I'm not asking how much France will lose, I am asking what makes SF/ULA supporters believe that the wealthy and the educated won't leave here.

Well?

This is a bit of mad thread. You want someone else to explain why your views are wrong when you've only offered notional evidnce to support your view.

johnnyskeleton · 09-09-2012 4:28pm

Monty Burnz wrote: »

KyussBishop wrote: »

Your question is loaded for starters, both in implying that high-earners leaving is a bad thing, and also in implying that anyone who argues against your point of view is supportive of SF/ULA.

If you're not looking to answer questions countering your argument, then this isn't a discussion but is soapboxing instead.

You are desperate to move the discussion onto another point - the consequences of wealthy people leaving the country. If you want to start a thread on that, please go ahead.

I am trying to establish whether there is any serious argument can be made that claims that wealthy people would not leave if taxes for the wealthy were substantially increase.

I take it that you have no such argument to make - a simple admission of that would be fine.

where is your analysis that establises that they would leave and under what circumstances? Once you provide that people can put a counterargument if they have one.

Otherwise this thread is alog the lines of "I believe in the flying spaghetti monster, and if noone else can prove that he doesn't exist then I win the thread".

Monty Burnz · 09-09-2012 4:33pm

KyussBishop wrote: »

Where to go from there though, when discussing consequences is out of the range of the debate?

Basically, I envisioned working through this question one point at a time. The amount of tax income/enterprise lost (or gained :eek:) by such a measure, the number and nature of the people leaving etc. could be debated in other threads.

Monty Burnz · 09-09-2012 4:36pm

johnnyskeleton wrote: »

This is a bit of mad thread. You want someone else to explain why your views are wrong when you've only offered notional evidnce to support your view.

You might outline which 'view' I have stated in the OP is 'wrong' - you are begging the question here.

ResearchWill · 09-09-2012 4:48pm

Ok lets assume the info I posted earlier was in fact correct

Ireland’s top 0.5% of earners, the 11,714 people who earned more than €275,000 in a year, paid almost 18% of all income tax, over €2bn in total. Their average tax rate was 27.5%.

Ok now say we increase the average tax rate to 30% thats (god my Maths is crap) I think the extra take would be 181 million open to correction. Then the question is would we lose any of those tax payers now say we use on average 1% of those taxpayers then the loss would be C 22 million in effect we would need to have about 10% of those guys leave to have a negative effect.

oppenheimer1 · 09-09-2012 4:52pm

Tax the rich and it will solve our problems - this is a fallacy perpetuated by the ULA on a somewhat naive electorate. First of all, there are not many high earners in Ireland and the majority of the owners of successful businesses do not pay themselves huge wages. Why would they take more than they need out of their companies when it is taxed at 55%? Most rich leave their wealth sitting in companies or investment vehicles and cannot be touched by income tax law or make investments with it. The only real high cash earners are in the IFSC and they are highly mobile. At the height of the boom less than 1000 people earned over €1m in the entire country. Even if you taxed these people at 100% it would generate an insignificant sum in reality. Theres simply not enough of these people.

The unfortunate and painful reality is that in order to raise significant sums is that you have to raise taxes on the largest co-hort of taxpayers, the middle income earners or business. I'm not saying higher earners should not see an increase in their taxes (they should in the interests of fairness), but the returns talked about by the ULA etc are clearly overstated. Low tax on business has been a cornerstone of our economic policy and is seen as untouchable. The idea of even tampering with it might do more harm than good and we cannot afford to see our major exporters leaving.

KyussBishop · 09-09-2012 5:06pm

Monty Burnz wrote: »

Basically, I envisioned working through this question one point at a time. The amount of tax income/enterprise lost (or gained :eek:) by such a measure, the number and nature of the people leaving etc. could be debated in other threads.

Okey well I guess that's [/thread] then seeing as we know some high earners will leave; pity we can't talk about the consequences, nothing left to discuss here everyone, move on

Monty Burnz · 09-09-2012 5:12pm

KyussBishop wrote: »

Okey well I guess that's [/thread] then seeing as we know some high earners will leave; pity we can't talk about the consequences, nothing left to discuss here everyone, move on

I'd allow the question to remain open for a while - there may be some people who would like to think that people will not move, or that a socialist tax regime might attract wealthy people to the country.

Cheerful Spring · 09-09-2012 5:41pm

The top tier tax rate in Ireland is low compared to what France has. You also presume wealthy people all of them provide employment. They don't. The majority of the wealthy don't have all their money in Ireland, as well. This speculation on my part of course, but that is how the wealthy work.

johnnyskeleton · 09-09-2012 5:52pm

Monty Burnz wrote: »

johnnyskeleton wrote: »

This is a bit of mad thread. You want someone else to explain why your views are wrong when you've only offered notional evidnce to support your view.

You might outline which 'view' I have stated in the OP is 'wrong' - you are begging the question here.

I'm not sure you're reading my posts. I am expressing no opinion on whether your comments are right or wrong because you haven't presented any real analysis that can be debated.

In any event you have your answer - yes, some people will probably leave and as ResearchWill points out the extent that that can be measured as a good thing or a bad thing depends on how many leave vs the extra income gained. Of course, you don't wantto debate that but you just want someone from the ula to begrudgingly admit that it's possible that rich people will leave so that you "win" the thread.

scheister · 09-09-2012 5:57pm

this is a question i put a lot of interest in as people as talk about a wealth tax in this country. While the article that was posted earlier makes an interesting point about who pays a bulk of the tax and it appears that it is the middle class. Like most things in tax its not the year that the policy comes in or the years after but 3-5 years down the line when the tax residency rules start to alter the payee status. Id imagine that some people will move tax havens to protect their income such as bono has done in moving to Holland (i think). I for one will be interested to see how the policy in France affects the returns over then next few years. But surely anyone that is looking at the policy and trying to fill the gap in the Irish Finances will see that it is not taxing one group that will do it but burden sharing and taking something off everyone that will do the trick.

Monty Burnz · 09-09-2012 6:06pm

Cheerful Spring wrote: »

The top tier tax rate in Ireland is low compared to what France has.

Right, but perhaps you don't realise that this means that such a tax rise would be proportionately bigger in Ireland than it is in France. A bigger tax rise would presumably have a bigger effect.

Cheerful Spring wrote: »

You also presume wealthy people all of them provide employment.

I do? Where?

Cheerful Spring wrote: »

They don't. The majority of the wealthy don't have all their money in Ireland, as well. This speculation on my part of course, but that is how the wealthy work.

No, you are certainly right that seriously wealthy people will usually diversify where their wealth is held. But this does not matter if we are talking about income tax.

Monty Burnz · 09-09-2012 6:09pm

johnnyskeleton wrote: »

I'm not sure you're reading my posts. I am expressing no opinion on whether your comments are right or wrong because you haven't presented any real analysis that can be debated.

Am I required to present an analysis? Is that in the charter? Or can I cite examples of what happens elsewhere and ask what would happen in similar circumstances here?

johnnyskeleton wrote: »

In any event you have your answer - yes, some people will probably leave and as ResearchWill points out the extent that that can be measured as a good thing or a bad thing depends on how many leave vs the extra income gained. Of course, you don't wantto debate that but you just want someone from the ula to begrudgingly admit that it's possible that rich people will leave so that you "win" the thread.

I don't know that a thread can be 'won' (perhaps in your mind it can?) but when a consensus emerges on this subject, I'll move onto the next discussion point on this topic and see if we can establish a consensus on that.

Cheerful Spring · 09-09-2012 6:36pm

Monty Burnz wrote: »

Right, but perhaps you don't realise that this means that such a tax rise would be proportionately bigger in Ireland than it is in France. A bigger tax rise would presumably have a bigger effect.

I do? Where?

No, you are certainly right that seriously wealthy people will usually diversify where their wealth is held. But this does not matter if we are talking about income tax.

If there is no benefit for our country with wealthy people staying or going. Well than why are you so worried? Business owners tend to be well off and i will agree it would not be good to see them leaving this country in a panic. But a slight rise in their tax is not going to cause that much of an effect. I believe that. Business leaders of Irish decent especially there not going to uproot their families because of a slight tax increase and move to another country.

France has a higher tax rate is it very high (75%) I can see why the wealthy people of that country would be upset with it. But its unlikely France has done this without looking at the consequences first. Well i hope they have?

Anyways our high tax rate is 35% i believe way lower. Is not likely there will a jump to the French rate here. And how many French who were wealthy left France before this increase. Be interesting to find out. This will be a model to follow and set what happens over there in the coming months and years.

Tax the rich

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