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Originally Posted by travis t
The 16th Amendment was enacted in 1913 because the Supreme Court ruled that Congress did not have power to impose an income tax. Ergo, it is pretty obvious that yet another amendment would be required for a wealth tax.
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That's exactly right.
Quote:
Originally Posted by Clarallel
I strongly doubt it's unconstitutional.
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That's because you're ill-informed and don't understand the Constitution.
The Constitution does not permit a tax on Wealth.
Quote:
Originally Posted by silverkris
What's unconstitutional about it? Congress has the power to tax and spend. Period. That's in the Constitution - Article I, Section 8.
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You failed to read the Constitution, specifically Article I Section 9:
No capitation, or other direct tax shall be laid, unless in proportion to the census or enumeration herein before directed to be taken.
That was invalidated through an amendment:
Amendment XVI
The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.
The operand is "incomes."
Quote:
Originally Posted by Daryl_G
What were the rest of the rates in the 1950’s? Asking because I didn’t see a comparison to rates.
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Rate comparisons are invalid, immaterial and disingenuous.
Yes, it's true that at one time the highest tax bracket was 92%, and for quite a few years it was 91%, but no one in person in the US ever paid 92% or 91%.
They never even paid 70%. And, when the highest tax bracket was lowered to 70% in 1964, not one person in the US ever paid 70%.
In fact, throughout that entire time, only handful of people paid 50%.
The vast majority of the wealthy, about 99% paid only 32% to 45% in taxes.
Why?
You have to look at the underlying IRS Tax Code in effect during that period.
The original 1913 IRS Tax Code underwent minor changes in I believe 1939, then again in 1954, and then underwent a complete transformation in 1986.
Before the 1986 IRS Tax Code eliminated them, there were thousands and thousands of income deductions and hundreds and hundreds of tax credits.
Keep the receipts from gassing up your car, because the federal excise tax on gasoline was deductible. So was the State tax on gasoline. And federal and State taxes on oil and lubricants, so every time you bought a quart of oil for your car, it was tax deductible.
Buy a set of tires for your car? The federal excise tax on rubber (in effect for many, many decades) was deductible.
All taxes were deductible.
State income tax, county and municipal income taxes, property taxes, and sales taxes at the State, county and municipal levels. You kept receipts for everything you bought, because the sales taxes were deductible.
All interest paid was deductible. Interest on your mortgage, your car loan, your credit cards, your charge cards (different than a credit card), your personal loans, all other loans, revolving credit accounts and interest paid to your local furniture, appliance or flooring stores.
All fees paid to any government were deductible. That includes professional licensing fees, the fees you paid for the sticker to go to a State or county park, the inspection fees for your car, because cities liked for people to pay to have their cars inspected and issued a sticker giving you permission to park within city limits.
All insurance premiums paid, whether for life insurance, car insurance, health insurance, home-owner's insurance and such.
Loads of depreciation schedules. Buy a car, depreciate the value and deduct it. Buy furniture or a washer or dryer, depreciate the value and deduct it. Buy a TV, depreciate the value and deduct it.
All clothing for work, regardless of your occupation was deductible. Your mileage to and from work regardless of your occupation was deductible.
So, by the time the wealthy took all of their legal deductions, their tax bracket dropped from 91% to less than 70%.
Then, by the time they took all of their legal tax credits, they ended up paying 35%-40%.
The 1986 IRS Tax Code overhaul eliminated 90% of those deductions and credits, and greatly simplified the tax code, and it also eliminated a few thousand IRS workers.
Quote:
Originally Posted by djmilf
The Sixteenth Amendment states that: "The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration." Yet the citation of the amendment in the original post ends at the first comma. Now why is that? |
Because it's not relevant.
Quote:
Originally Posted by djmilf
Bottom line - anyone claiming that a federal tax upon wealth is unconstitutional, is either a liar or "uninformed".
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Like you.
Explain what income is derived from vacant property.
I had an old girl-friend who inherited a 100 acre farm from her grandfather. At the time, the early 1990s, it was valued at $200/acre.
Today,
other people say it's valued at $28,600/acre.
So, you're insanely jealous because her net worth -- at least related to the property -- has increased from $20,000 to $2.86 Million in 25 years, because
other people say the property is worth more, and you want to tax her.
She doesn't derive any income from that property. It's just sitting there. A couple of developers have approached her over the years, but she doesn't want to part with it until she retires (which is a good retirement strategy for her).
When she does sell it, she'll pay Capital Gains taxes on it, so it's not like she's getting away Scott free.
Even if it would be developed, and she derived rents from it, she would pays taxes on the rent income derived from it, so again, it's not like she'd be getting away Scott free.
People like Bill Gates who own several $Billion in stocks,
because other people say the stocks are worth that much, only derive income when he sells the stocks, and then he pays Capital Gains taxes on the sale.
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