Monday, February 18, 2013

A Question For The High Tax Left: What Is 39.5% Of Nothing?

Tax rates effect behavior. Tax rates that are too high result in people taking action to reduce their exposure to them. Examples abound, but the most recent is boxer Manny Pacquiao. He is refusing to fight his next match in the U.S. because he will have to fork over 39.5% of his purse to our government. His solution, hold the fight in China, where, despite a smaller purse, he will come home with $5 million more in his pocket. Tax Prof has the whole story.

When will the left learn that taxation is dynamic, not static. Raising taxes 10% does not mean 10% more revenue except in CBO projections. In fact, it may mean less revenue than before the increase was imposed. Or does the left realize this yet keep up their calls for ever higher taxes anyway because class warfare is their primary tactic?





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