Coming from a country with a graduated income tax, it just sucks for people a little above the limit, people like me, lets say y make 550K a month, and the limit is at 540K, so instead of not paying any taxes, I have to pay 10% that brings me down to 495K so I end up earning less than someone that earns 520K.
Coming from a country with a graduated income tax, it just sucks for people a little above the limit, people like me, lets say y make 550K a month, and the limit is at 540K, so instead of not paying any taxes, I have to pay 10% that brings me down to 495K so I end up earning less than someone that earns 520K.
Coming from a country with a graduated income tax, it just sucks for people a little above the limit, people like me, lets say y make 550K a month, and the limit is at 540K, so instead of not paying any taxes, I have to pay 10% that brings me down to 495K so I end up earning less than someone that earns 520K.
That's a stupid way to do graduated income tax. Here's how it should be done (and probably is, you likely just don't pay attention) - If the tax is 0% from 0-540k, and 10% after that, and you make 550k then you should pay 0% tax on 540k, and 10% only on the remaining 10k. Hence you'll only pay 1k in tax, and earn 549k. You'll certainly be better off than the guy who earned 540k.
The answer to the jumps is simply to use technology. Percent income tax should be a continuous function of income. Simple, effective, and lacking the "bracket-jumper penalty."
Remember. Properly applied technology can mitigate or solve most of the problems our government has.
No flames. I just wanted to point out a blog entry that says what everyone should be considering right now. While the beginning focuses on Vermont, the remaining discussion of national affairs is spot on. It says everything that I've been thinking and then some.
Coming from a country with a graduated income tax, it just sucks for people a little above the limit, people like me, lets say y make 550K a month, and the limit is at 540K, so instead of not paying any taxes, I have to pay 10% that brings me down to 495K so I end up earning less than someone that earns 520K.
I'll add something a little more meaningful than "cry me a river." (Ironically enough, I was just criticized by that poster for not contributing anything meaningful. See what I mean about the hypocrisy here?) I also recognize that while your numbers are large, this may be an extremely important issue for someone raising a family that gets a raise on much smaller earnings. Having compassion for people who are poor and disadvantaged, and recognizing that this is an important issue for all classes of people, I wanted to point out the following:
Are you sure that's how it works in your state? In every jurisdiction I'm aware of, the increased rate is only applied to the amount of money you make over the threshold. So in your example, if there was no tax on the first $539,999 of your income, but a 10% tax for those making $540,000 and over, you would only pay 10% on $10,000 worth of income (assuming you made $550,000). Therefore, your tax bill would be $1,000, and you would still make more than the person who brought home $539,999. You'd bring home $549,000.
Another, more relevant, example: A struggling single mother makes $29,999 per year. She gets a raise to $31,000 per year. Assuming that there were no taxes on her $29,999, but the raise puts her into the 10% bracket, she would only pay $100 in taxes. So she's still better off.
That's a stupid way to do graduated income tax. Here's how it should be done (and probably is, you likely just don't pay attention) - If the tax is 0% from 0-540k, and 10% after that, and you make 550k then you should pay 0% tax on 540k, and 10% only on the remaining 10k. Hence you'll only pay 1k in tax, and earn 549k. You'll certainly be better off than the guy who earned 540k.
This is how it works here. You pay the increased percentage only on the wages above the cutoff.
Find someone you love so much that their flaws don't even matter.
A flaw of "I'm an ignorant idiot who doesn't understand logic and I choose to keep myself that way" is kind of major. It doesn't matter how much I love someone; I have to be able to respect them too if I'm going to stay with them. I cannot date someone I do not respect. Period.
1. A. It's colones 560 colones = $1 so, thats about $1.000 a month. B. A carton of milk (1 liter) is about $1 and a loaf of sliced bread also about $1(the cheap store brand)
2. I'm pretty sure they take about 40K as it says on the receipt I have in front of me. (as its about 9% actually of the excess above minimum wage if I'm not mistaken), I wasn't paying taxes before my raise, got the raise, I ended up working the same amount of time with actually less pay, but I'll look into that.
3.As for complaining, I'm not, I'm all for a graduated system, it means that yes, I pay more taxes, but if it helps take the burden off someone who really needs that 10%, its all good, money is good and all, but there are more important things
4. Let me add that I also pay 10% on "universal" health care and again, am not against it, in fact I'm all for it (although it has a lot of problems, like ERs crowded with knee scrapes and colds)
The answer to the jumps is simply to use technology. Percent income tax should be a continuous function of income. Simple, effective, and lacking the "bracket-jumper penalty."
You use the word "technology", but that term doesn't apply particularly well to the mathematical aspect of the problem (though I admit both the mathematics and the technology involved are trivial). Nonetheless, surely there isn't any country in the world that actually has a "bracket-jumper penalty"... http://en.wikipedia.org/wiki/Progressive_tax demonstrates quite quickly how it can be avoided with the most basic of systems - and as far as I can tell that's how it works in pretty much all countries.
While a continuous function is helpful and fun, it is not a sufficient condition, and, indeed, it is not even a necessity. Given income i, and a continuous income tax function (as a proportion of total income tax) T(i) < 1 (cannot tax people for more money than they have, after all), after-tax income is the remaining income, i.e. i(1 - T). To prevent incentive traps, it is necessary and sufficient to ensure that i(1 - T) is a monotonically increasing function of i. In other words, for a continuous function, the requirement is that For example - taxing everyone at 100% certainly keeps an incentive trap, but it's a continuous function I can continue to come up with more interesting examples if you wish.
However, it does bring up an interesting question. What is the ideal tax function? EDIT: I'm looking for answers other than the trivial T(i) = 0
By technology, I mean to say that a very complex and much more granular tax system could easily be implemented with computers and software, rather than the monstrosity that is our current tax code.
Hmm, you were right, I got charged more, because I get paid every 2 weeks, so last month I was payed 3 times, so, my salary was on like the 3rd cut and thus had to pay a lot more.
Can I vent for just a sec? I need to find a BF that doesn't have a critical flaw. Like being a creationist or being a stubbornly ignorant OCD pain in the ass. ARGH! Okay, done.
There are many cute and nice boys up here. I hope you move up for lawyer school.
“Conservatives tend to be happier than liberals in general,†said Dr. Martin, a psychologist at the University of Western Ontario. “A conservative outlook rationalizes social inequality, accepting the world as it is, and making it less of a threat to one’s well-being, whereas a liberal outlook leads to dissatisfaction with the world as it is, and a sense that things need to change before one can be really happy.â€Â
Here's something else I want to draw attention to.
The Democratic party will have to make very few compromises to pass legislation through the senate. The Republican party is on the rocks, and may never again resemble the party of Teddy Roosevelt. This may seem great for people who agree with the Democratic party platform.
But as great as it may seem, be wary. The only thing worse than a two party system is a one party system. I see a chance that the US could quickly end up like Japan where the LDP had effectively complete control for over 50 years, losing some of that control only recently. An election with one major party is as much of a farce as a rigged election. Without any valid competition, politicians will have no fear of losing their jobs. I don't think I need to explain why this is a bad thing.
Even if people you agree with 100% have complete and utter control of government, a lack of real opposition will be extremely harmful to the political fabric.
And when the two candidates are literally clones of each other, we will create a cyborg Nixon who will win the election and proceed to rampage through the white house in his terrifying metallic body. The future is bleak.
Liberals are unhappy because we address reality and refuse to delude ourselves into believing everything is OK when it's really not. Reality generally sucks, so we're unhappy.
Conservatives lie to themselves and everyone around them to make them think they are happy and everything is OK.
Also, conservatives can't get off unless they kill puppies. It's true.
Hi, my name is Nuri. I'm a liberal, and I'm generally happy with my life. Except my boyfriend.
Knowing the government is going in the wrong direction is quite a different thing than being unhappy. Also, I'm not being persecuted, demeaned, or discriminated against for my lifestyle choices. I generally keep them secret from the people I think would do these things. Many people do not have the luxury of secrecy that I have, and are thus unhappy.
Yeah, but I get to have this smug self-righteousness. It's good stuff.
Good point - except that the conservatives are smug too. They're just happier in their smugness and self-righteousness.
I dunno, I'm a lot happier knowing that I'm right. It's hard to beat the self-satisfaction that comes with being completely and totally correct about everything.
I dunno, I'm a lot happier knowing that I'm right. It's hard to beat the self-satisfaction that comes with being completely and totally correct about everything.
In all seriousness, this is an interesting argument. The science suggests that this is not true. You may think that you are happier, but the science bears otherwise. This is a good example of bias on the part of the observer. But we're all partial to the scientific method here, no? Of course in any specific example, there is always the possibility of deviation.
Comments
Here's how it should be done (and probably is, you likely just don't pay attention) -
If the tax is 0% from 0-540k, and 10% after that, and you make 550k
then you should pay 0% tax on 540k, and 10% only on the remaining 10k.
Hence you'll only pay 1k in tax, and earn 549k. You'll certainly be better off than the guy who earned 540k.
Remember. Properly applied technology can mitigate or solve most of the problems our government has.
Are you sure that's how it works in your state? In every jurisdiction I'm aware of, the increased rate is only applied to the amount of money you make over the threshold. So in your example, if there was no tax on the first $539,999 of your income, but a 10% tax for those making $540,000 and over, you would only pay 10% on $10,000 worth of income (assuming you made $550,000). Therefore, your tax bill would be $1,000, and you would still make more than the person who brought home $539,999. You'd bring home $549,000.
Another, more relevant, example: A struggling single mother makes $29,999 per year. She gets a raise to $31,000 per year. Assuming that there were no taxes on her $29,999, but the raise puts her into the 10% bracket, she would only pay $100 in taxes. So she's still better off.
A. It's colones 560 colones = $1 so, thats about $1.000 a month.
B. A carton of milk (1 liter) is about $1 and a loaf of sliced bread also about $1(the cheap store brand)
2. I'm pretty sure they take about 40K as it says on the receipt I have in front of me. (as its about 9% actually of the excess above minimum wage if I'm not mistaken), I wasn't paying taxes before my raise, got the raise, I ended up working the same amount of time with actually less pay, but I'll look into that.
3.As for complaining, I'm not, I'm all for a graduated system, it means that yes, I pay more taxes, but if it helps take the burden off someone who really needs that 10%, its all good, money is good and all, but there are more important things
4. Let me add that I also pay 10% on "universal" health care and again, am not against it, in fact I'm all for it (although it has a lot of problems, like ERs crowded with knee scrapes and colds)
http://en.wikipedia.org/wiki/Progressive_tax demonstrates quite quickly how it can be avoided with the most basic of systems - and as far as I can tell that's how it works in pretty much all countries.
While a continuous function is helpful and fun, it is not a sufficient condition, and, indeed, it is not even a necessity.
Given income i, and a continuous income tax function (as a proportion of total income tax) T(i) < 1 (cannot tax people for more money than they have, after all), after-tax income is the remaining income, i.e. i(1 - T). To prevent incentive traps, it is necessary and sufficient to ensure that i(1 - T) is a monotonically increasing function of i. In other words, for a continuous function, the requirement is that
For example - taxing everyone at 100% certainly keeps an incentive trap, but it's a continuous function
I can continue to come up with more interesting examples if you wish.
However, it does bring up an interesting question. What is the ideal tax function?
EDIT: I'm looking for answers other than the trivial T(i) = 0
Conservatives lie to themselves and everyone around them to make them think they are happy and everything is OK.
Also, conservatives can't get off unless they kill puppies. It's true.
Knowing the government is going in the wrong direction is quite a different thing than being unhappy. Also, I'm not being persecuted, demeaned, or discriminated against for my lifestyle choices. I generally keep them secret from the people I think would do these things. Many people do not have the luxury of secrecy that I have, and are thus unhappy.
-Carl Sagan