The global economic is in bad shape because the most wealthy and top income earners pay too little tax. The governments do not collect enough revenue to pay for the services and expenditures, including the welfare for the very poor. These governments have run large deficits which are not sustainable.
To overcome this budget deficit, the governments have to raise the tax revenue on the very rich who are earning a disproportionate share of the national income. Different tax rates in various countries allow the rich people to use creative accounting to move their earnings to countries that charge the lowest rate of tax. This "beggar thy neighbor" competition, including tax havens, is causing further damage to the global system.
A possible solution, as advanced by Hilary Clinton, is to "raised taxes on the rich everywhere". It requires an international agreement. It is a necessary step to solve the global financial and economic malaise.
Read this article
http://www.cnbc.com//id/49150934
To overcome this budget deficit, the governments have to raise the tax revenue on the very rich who are earning a disproportionate share of the national income. Different tax rates in various countries allow the rich people to use creative accounting to move their earnings to countries that charge the lowest rate of tax. This "beggar thy neighbor" competition, including tax havens, is causing further damage to the global system.
A possible solution, as advanced by Hilary Clinton, is to "raised taxes on the rich everywhere". It requires an international agreement. It is a necessary step to solve the global financial and economic malaise.
Read this article
http://www.cnbc.com//id/49150934
The mentality of charging the rich is extremely risky.
ReplyDeleteThere are many rich person who got their wealth by honest way. Extreme tax on them will discourage Entrepreneurship.
If there is less people to venture into business, NO WAY that the economy can be improved.
So long as they do not avoid tax, do not charge them heavily like what France going to do.
I get the impression that it is much easier to get very rich by gambling, corruption and by cheating. This is strongly evident in the financial service sector - look at the wrong doings and shady practices.
ReplyDeleteThere are also many people who get wealthy in the honest way, but most of these people work for the joy of it, and not for the extreme wealth. They do not mind paying higher taxes. The entrepreneurial spirit will not be severely dampened.
I support Hilary Clinton's call. It is a necessary step to restore order in the world.
I also support the move by France to tax 75% of earnings above 1 million euros. It may appear harsh, but who needs more than 1 million euros a year to live on, except to show their wealth?
If there is high tax, people will not spend $1.3 million on a Ferrari and drive at breakneck speed.
During the 1970s, the typical English worker dun wan to do overtime, he argued the overtime pay were taxed, so may as well went home after an 8 hour work shift to spend with family.
ReplyDeleteIf you overtax a person, it does kill the incentive to work for more.
Think the best strategy is to tax not more than 40% flat of anyone who earn more than $1m per year.
If a Minister here earns $2m a year, he has to pay $800,000 in tax.