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Capital gains not only refers to the stock market. Individuals who own property which appreciates in value will also have to pay this insane 90% tax on the profit from the sale of income producing properties they own.
Say I bought a 3 bedroom home in a particular neighborhood 30 years ago for $70,000, and I am renting it to a family. When I sell that home, after 30 years the property may have more than doubled in value. So I sell it for $200,000 and, under your plan, after subtracting the 6% real estate commision, I have a total profit of $188k -$70k original price = $118k profit (not really, I'm simplifying here, after all I've been paying property taxes etc on this property for 30 years, not to mention income tax on the income it produced for 30 years). Then I have to give the government 90% of that profit. So after paying my capital gains taxes I have my $70k + the 10% of the $118k gain...or $70k + $11.8k =$81.8k. The identical home in that neighborhood now costs $200k, so I won't even have enough money to purchase a home similar to the one I sold, all I can buy now, after selling my 3 bedroom rental property, is a Tough Shed!
No one would bother to own rental real estate if this is how it works. Property owners would literally be losing money. Where would all the people who can't afford to purchase a home live if there are no rentals? And the same scenario could be applied to the sale of commercial properties which are leased.
Last edited by TheShadow; 01-12-2019 at 01:24 PM..
Capital gains not only refers to the stock market. Individuals who own property which appreciates in value will also have to pay this insane 90% tax on the profit from the sale of income producing properties they own.
Say I bought a 3 bedroom home in a particular neighborhood 30 years ago for $70,000, and I am renting it to a family. When I sell that home, after 30 years the property may have more than doubled in value. So I sell it for $200,000 and, under your plan, I have to give the government 90% of the profit. So I sell it, and after paying my taxes I have my $70k + the 10% of the $130k gain...or $70k + $13k equals...$83k. The identical home in that market now costs $200k, so I won't even have enough money to purchase a home similar to the one I sold, all I can buy now, after selling my 3 bedroom rental property, is a Tough Shed!
You're going to confuse the poor kid with that kind of logic.
Capital gains not only refers to the stock market. Individuals who own property which appreciates in value will also have to pay this insane 90% tax on the profit from the sale of income producing properties they own.
Say I bought a 3 bedroom home in a particular neighborhood 30 years ago for $70,000, and I am renting it to a family. When I sell that home, after 30 years the property may have more than doubled in value. So I sell it for $200,000 and, under your plan, after subtracting the 6% real estate commision, I have a total profit of $188k -$70k original price = $118k. Then I have to give the government 90% of that profit. So after paying my taxes I have my $70k + the 10% of the $118k gain...or $70k + $11.8k =$81.8k. The identical home in that neighborhood now costs $200k, so I won't even have enough money to purchase a home similar to the one I sold, all I can buy now, after selling my 3 bedroom rental property, is a Tough Shed!
Have no fear, because in this...new world...value of property will tank...so you won’t have to pay 200k for the next house either!
Or you can just walk into a different property because no one has property rights and the communities property is your property.
It is only a tax on profits (so not total sale value).
I'm not supporting it from a tax revenue stand point, I don't care about that, but it would lower economic activity in the corporate sector and dissuade people from investing (and inflating) the stock market.
The materialistic profit motive that has driven our economy has built an authoritarian state where money buys you freedom, and the more money you have, the more freedom you have as well.
To create a freer society it must be more egalitarian and not based on increasing economic activity.
Also in the long run it will lower government revenues and slow imperialistic ambitions abroad.
Furthermore people will be happier not trying to become millionaires and building a life rather than making a living.
Please- just move to North Korea. You'd have capitalism excluded to your heart's content, and you could leave the rest of us alone.
Get a grip TaxPhd, you’ve yet to say one thing of substance besides attacking me.
That’s probably because your arguments were absolutely annihilated in your last nonsense 50 page thread. It’s impossible to actually take your thread serious as anything other than a troll.
Your idea is basically like a soccer fan coming to a baseball camp full of people who love baseball and telling them that soccer is better and that they’re all wasting their time playing baseball.
Why don’t you just go play soccer (live with your 3,000 year outdated community system) over with like minded people (in some poor, irrelevent country). Or use your freedom here to try a community or business with your ideas (and fail spectacularly)
And how would those individuals with 401k's fund their retirements if they are earning virtually nothing in their company's retirement savings plan???
Why should retirees be dependent on corporate wealth. Not only is it wrong but it distorts the natural interests of retirees and ties it to that of corporate ceos.
But a better system is cooperative community investment where local institutions and family would help them out. Today that is difficult do to high prices and and private control of these institutions by for profit companies.
Taking away corporate power would force local investments scaled to the needs of the people, not unseen shareholders who only care about profit.
That’s probably because your arguments were absolutely annihilated in your last nonsense 50 page thread. It’s impossible to actually take your thread serious as anything other than a troll.
Your idea is basically like a soccer fan coming to a baseball camp full of people who love baseball and telling them that soccer is better and that they’re all wasting their time playing baseball.
Why don’t you just go play soccer (live with your 3,000 year outdated community system) over with like minded people (in some poor, irrelevent country). Or use your freedom here to try a community or business with your ideas (and fail spectacularly)
Nothing has been annihilated.
I make criticism of industrial capitalism, people say that is just the way things are.
I suggest local power connected by industry and technology to retain modern standards, just reorganize power to make society freer and more egalitarian (two intrinsically tied things).
Here I’m saying raising the CGT can dissuade corporate reliance and help turn the economy from profit demands to local investments controlled by the community.
So instead of small businesses requiring corporate investment to keep up with competition and stay open, and instead of retirees relying on corporate wealth to have money, investment controlled by localities to build institutions to meet the needs of said retirees can take hold.
You have yet to address any of my points seriously and instead throw around false accusations and insults.
Capital gains not only refers to the stock market. Individuals who own property which appreciates in value will also have to pay this insane 90% tax on the profit from the sale of income producing properties they own.
Say I bought a 3 bedroom home in a particular neighborhood 30 years ago for $70,000, and I am renting it to a family. When I sell that home, after 30 years the property may have more than doubled in value. So I sell it for $200,000 and, under your plan, after subtracting the 6% real estate commision, I have a total profit of $188k -$70k original price = $118k profit (not really, I'm simplifying here, after all I've been paying property taxes etc on this property for 30 years, not to mention income tax on the income it produced for 30 years). Then I have to give the government 90% of that profit. So after paying my capital gains taxes I have my $70k + the 10% of the $118k gain...or $70k + $11.8k =$81.8k. The identical home in that neighborhood now costs $200k, so I won't even have enough money to purchase a home similar to the one I sold, all I can buy now, after selling my 3 bedroom rental property, is a Tough Shed!
No one would bother to own rental real estate if this is how it works. Property owners would literally be losing money. Where would all the people who can't afford to purchase a home live if there are no rentals? And the same scenario could be applied to the sale of commercial properties which are leased.
Wealth shouldn’t be made off of increased property value. That is what starts house flipping and worse private power can store and grow wealth without supporting workers, the thing that economic activity is suppose to help.
If you want to tie the CGT to inflation as to keep the relative value of your property to the time you paid for it, fine.
But land shouldn’t create wealth just by nature of its value.
The same problem happens with commodities and other non-inventory goods. Apartments in NY are bought to store and grow wealth, even though no wealth is actually being created.
Edit: by the way, I’m against property taxes on any primary property worth less than 10 million dollars.
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