Quote:
|
The poor have to spend most or all of their income, while the rich tend to invest most of it. Spending gets taxed, investing does not. Thus by increasing the rate for the higher incomes, you end up paying about the same percentage of your income.
|
A view of investment resources that have a profit is compensation for risk taking to the individual. Social benefit, it provides employment.
Investments do have tax component. At the corporation level the corporation pays taxes on profit, and then the distribution of those profits to the owners are taxed again (formerly). Partnerships' of a business or sole owner pay taxes based on whatever is drawn from the business, and capital gains taxes are paid on a sale that a business may have reinvested in the growth of the business.
Estate taxes (large) are imposed on distribution to beneficiaries on money that may have already been taxed on money generated from a business and reinvested in the business or other sources.
"...increasing the rate for higher incomes..."(This is an unsuccessful attempt to describe regressive taxation.) Regressive taxation has been correctly stated in another post on this thread.