What do the wealthy do with their money that isn't taxed?XtremeJibber2001 wrote:By the theme of the thread I assume you're talking income tax cuts for the wealthy, which decreased from 39.6% to 37% for those making $500k (single-filer) to $600k (joint+). Is there a particular study that demonstrates these types of cuts result in the wealthy keeping more of their capital in the US? Personally, I don't buy it.Mister Moose wrote:Except that everyone, including the wealthy, does not operate in a vacuum when it comes to tax policy. People choose to structure their finances to reduce their tax burden. So with higher taxes on the wealthy, they choose where to place their capital based on the current tax structure. If the tax structure is too oppressive, the money goes elsewhere.
So in some cases, yes, it does make sense to cut certain taxes on the wealthy, as it changes the allocation of the their resources, and if that brings more investment and jobs to the US, that's a good thing. For everyone.
Now if you're talking the corporate tax rate then I agree it changes the allocation of their resources. However, it does not consistently result in more jobs ... investment, yes. Expect higher dividends, more share buy backs, more returning of profits to shareholders .... one might argue these disproportionately benefit the 'wealthy'.
When does a corporation decide to build product instead of buy back shares or raise the dividend?