Reader comment on: Kristof, Taxes and Billionaires
Submitted by Teo (United States), Jul 7, 2011 13:34
Kristoff's point was not necessarily whether those under $69K pay a higher or lower rate than the hedge fund manager.
His point was that those who work for a living should pay the rate of workers -- even those whose work is actually moving money (such as those who manage hedge funds). Today, those who move money -- those who manage hedge funds -- are taxed at the capital gains rate of 15% (or 28%). Meanwhile, those who go sit at a desk or go drive a truck or go work in a mill or go make a car, pay an income tax that carries a marginal rate that is higher than the capital gains rate. There is something wrong with that because essentially the same income is taxed differently. The worker netting $100,000 pays a marginal rate based on her income; the hedge fund manager who makes $100,000 (who also works) pays a rate -- likely lower -- based on how long she owned the security.
I think most people agree that we should not penalize people who "take entrepreneur[ial] risks." But, income should be treated as income; all of it. Right now, it doesn't appear that this is the case.
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