Tag Archives: taxes

Death Taxes

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Or, as President Barack Obama likes to call them, “trust fund taxes.” Either way, it’s another Progressive attempt to steal the gains of one family—now with its parent safely dead—to transfer them to another group of “families” of whom Obama approves.

As the graph below demonstrates, this latest wealth “redistribution” grab by Obama would represent, if it’s passed, a 36% increase to a world-beating 68% of a family’s hard-earned accumulated prosperity.InternationalDeathTaxRates

Not even the famously social-tax heaven of the UK confiscates that much of a family’s wealth on the death, nor do the social democracy nations of France, Belgium, Spain, Finland, Norway, etc. Russia and the People’s Republic of China have no death taxes at all.

Here’s the deal:

Under current law, when a parent or grandparent dies, the increase in the valuation of his or her asset from when it was originally purchased is not taxed.

This is to offset the effects of the estate tax.

But

Obama’s plan would tax estates and impose the regular capital gains tax on inherited assets—a business, property, or stocks.

That business, far from being a Buffet’s holdings in Berkshire Hathaway, or a Gate’s holdings in Microsoft, is typically the family’s only asset: a mom and pop business that mom and/or pop have spent a lifetime building, with little to no outside cash available with which to pay the Obama vig. They’d have to sell the business; they’d have to sell their children’s future to pay up. That property usually is the family home, which the family finally was able to afford in the late afternoon of the deceased parent’s life. Those stocks…. No trust funds here.

But, no worries. Obama and his Democrat Party Know Better. Their money, temporarily reposing in our hands for a few years, will be well used. Obama says so.

Austerity

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President Obama called for an end to “mindless austerity” on Thursday as he announced his desire to end “sequester” spending cuts in his budget for 2015.

No, Obama wants to perpetuate—even expand—the deliberate austerity of excessive government spending and ever-rising taxes. His “budget” calls for a 7% increase in Federal spending to be paid for with increased taxes, including increases in the death tax on inheritances (which Obama is attempting to disguise by calling it a “trust fund” tax). Indeed, Obama’s “thinking” on taxing was exposed by his attempt to tax Americans’ savings for our children’s college, our 529s.

If the Republicans and Conservatives in Congress are smart, they won’t waste time on the Obama stuff. They won’t even respond to his nonsense. They’ll just ignore it and pass a conservative budget that includes both tax reform and tax rate reductions.

Obama’s going to veto anything this Congress passes, anyway; his vetoes should simply be used to shape the ’16 elections.

Foolish

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Amazon will start collecting sales tax from Illinois consumers next month to comply with a new state law, the company said.

The Seattle-based e-commerce giant will be required to collect the 6.25% tax starting Feb. 1….

And

State retailers supported the legislation to level the playing field for brick-and-mortar businesses.

Foolish. The better way to level the playing field, the more economically efficient way, the way that actually would raise revenue for the verge-of-bankrupt Illinois government would have been to lower the sales tax charged to Illinois brick-and-mortar retailers. After all,

The Illinois Department of Revenue estimated uncollected taxes in 2013 from online purchases from Amazon and other retailers at $212 million.

Think about the effect on Illinois’ brokeness from withdrawing an additional $212 million from its economy.

Illinois collected $12.77 billion in sales tax in 2013 from a sales tax rate of 6.25%. Think about the boost to Illinois’ economy from a drop in the state’s rate of just one per centage point to 5.25%, which would leave a skosh over $2 billion in the hands of Illinois’ citizens.

But this is Illinois.

Another Bit on Taxes

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This is a tax increase that President Barack Obama chose not to mention in his State of the Union address while he was demanding to increase taxes on the “rich” in order to give that money to his “middle” class. Perhaps he chose to omit mention because this is a tax increase on that same “middle” class. And perhaps because it contradicts the story he’s spinning on wanting to make junior college “free.”

Recall 529 Plans, which facilitate parents’ and other family members’ (even family friends’) saving for the future college expenses of those parents’ children. Recall further that withdrawals from those 529s, when made pursuant to college expenses, are (so far) tax free. Obama’s hot tax idea is to change that, instead taxing the earnings on 529 savings when the money is withdrawn for college expenses.

This just illustrates the utter incoherence in Progressives’ taxing policies. And it’s another demonstration of the foolishness of using the tax code for social engineering—or for any other tampering with our economy.

Taxes

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Treasury Secretary Jacob Lew had a thought.

I don’t think that there’s any advantage in pretending that there aren’t big disagreements on the individual tax side. We had a national debate just two years ago about the top rate. We’re not looking at the kind of negotiation to go back to lower the top rate.

Never mind that after that debate and just a few months ago, Americans voted overwhelmingly to reject President Barack Obama’s tax policy—which he’d placed on the ballot along with every single one of his other policies (every single one of which were similarly rejected in that same election).

This Progressive, along with Obama, Knows Better and recognizes no obligation to listen to his employers.

It’s going to be a long two years with President No and his Party of Naysayers still in the way of economic reform and long term economic recovery and prosperity.