Firstly, the article deals only with state and local taxes. Anyone who has filled out a tax form knows what a piddling amount state and local taxes are in comparison to federal taxes.
Here is a quote from the same article stating exactly why it is state and local taxes are regressive in nature:
In fact the degree of regressivity of the taxes doesn't even compensate for the statement above that the demand for public services is quite inelastic. To be totally "fair" in this regard the regressivity should be even higher than what it is. However, I'm not a total a$$ and I believe that it is alright for the more fortunate to help the less fortunate to some degree. So I am fine with the degree of regressivity as it currently is.
Now examine the continuation of the above statement:
Considering that currently there is a subsidy from the more fortunate to the less fortunate given the inelastic nature of the demand for public services, this policy helps retain wealthier taxpayers in the state to help fund this subsidy. Overall this system benefits the less fortunate. I am fine with that to a certain degree.
If you want to talk about being "uber" right, one could argue that in order to be completely "fair" then individual income classes should pay for the amount of public service that they actually demand. This would demand a regressive federal tax system. However I will say that such an argument is pure stupidity, since it is essential to help the lower income classes for humanistic reasons, as well as for pure economic concerns. It is necessary that lower income classes be able to afford a decent standard of living as they really do form the basis for keeping the rest of the economy alive. However, I strongly feel that there shouldn't be an incentive for people who can't afford more than a certain number of kids to have more than they can afford. Having the government support people making minimum wage having 5 kids is a real problem.
Here is a quote from the same article stating exactly why it is state and local taxes are regressive in nature:
In fact the degree of regressivity of the taxes doesn't even compensate for the statement above that the demand for public services is quite inelastic. To be totally "fair" in this regard the regressivity should be even higher than what it is. However, I'm not a total a$$ and I believe that it is alright for the more fortunate to help the less fortunate to some degree. So I am fine with the degree of regressivity as it currently is.
Now examine the continuation of the above statement:
Considering that currently there is a subsidy from the more fortunate to the less fortunate given the inelastic nature of the demand for public services, this policy helps retain wealthier taxpayers in the state to help fund this subsidy. Overall this system benefits the less fortunate. I am fine with that to a certain degree.
If you want to talk about being "uber" right, one could argue that in order to be completely "fair" then individual income classes should pay for the amount of public service that they actually demand. This would demand a regressive federal tax system. However I will say that such an argument is pure stupidity, since it is essential to help the lower income classes for humanistic reasons, as well as for pure economic concerns. It is necessary that lower income classes be able to afford a decent standard of living as they really do form the basis for keeping the rest of the economy alive. However, I strongly feel that there shouldn't be an incentive for people who can't afford more than a certain number of kids to have more than they can afford. Having the government support people making minimum wage having 5 kids is a real problem.
2-25-2004 NJ Governor Aims to Tax Wealthy 'McMansion' Buyers
New Jersey Gov. James McGreevey has come up with a novel way to sock the wealthy -- make them pay a new $10,000 "McMansion" tax on homes that cost at least $1 million, a treasurer's spokesman said on Wednesday.
The nickname McMansion was coined to describe the new oversize homes that have proven highly popular in New Jersey and other states, although critics say their architecture is undistinguished at best.
"The term comes from (the fact) they all look the same," said an administration source, who spoke on condition of anonymity. "They kind of spring up from a mass franchise like McDonald's Corp. There's not a lot of character to them."
McGreevey on Tuesday unveiled his $26.3 billion budget for next fiscal year, which for the third year in a row, does not hike the sales or income tax.
The Democratic governor so far has spurned repeated calls by some Republican legislators to raise income taxes on the state's 9,900 millionaires.
New Jersey Gov. James McGreevey has come up with a novel way to sock the wealthy -- make them pay a new $10,000 "McMansion" tax on homes that cost at least $1 million, a treasurer's spokesman said on Wednesday.
The nickname McMansion was coined to describe the new oversize homes that have proven highly popular in New Jersey and other states, although critics say their architecture is undistinguished at best.
"The term comes from (the fact) they all look the same," said an administration source, who spoke on condition of anonymity. "They kind of spring up from a mass franchise like McDonald's Corp. There's not a lot of character to them."
McGreevey on Tuesday unveiled his $26.3 billion budget for next fiscal year, which for the third year in a row, does not hike the sales or income tax.
The Democratic governor so far has spurned repeated calls by some Republican legislators to raise income taxes on the state's 9,900 millionaires.
CADsortaGUY
Lifer
No, it doesn't stir me into a tizzy, infact it's pretty well argued but it has issues with seperating powers. Each state can tax their citizenry differently so you have to seperate the arguments. Feds is for everyone, whereas state and locals are their own provisioners. If people have a bitch about the supposed regressive nature of state and local taxes then how is that the Feds issue? Shouldn't they demand that their state change their taxation method if they think it's "unfair"? Do you bitch to your state gov't over Federal tax rates? If so, why? They can't change anything on the Federal level - they are state gov't-no?.
If people have an issue about overall "fair" taxation then shouldn't they address the part they don't think is "fair"? Meaning, if you think the poor carry to high of a burden - you best address the people that can change that(ie - not the Feds
) However, the Fed's system is not at all "fair" as it seemingly "punishes" those who earn more by making them pay for almost everything. Federal taxes should not be as "progressive" as they are, and they wouldn't have to take more from the rich if they weren't involved in things they have no business being involved in. I would welcome more state and local taxation if we had more local control of legislation - meaning the states would actually be responsible for those things not specifically granted to the Feds.
Good post sxr7171 :beer:
CkG
Honestly a 1% extra tax on a home is a almost a non issue, when we're talking about paying 65%+ of your annual gross income on taxes. You could argue that taxes all add up but buying a home is something that person does perhaps 3 or 4 times in one's life (less for million dollar homes), and in any case million dollar homes in the state of NJ appreciate quite a bit, so it doesn't even deter those that buy one as an investment property.
By the way, what this bit of information have to do "The Rich DO NOT Pay Taxes" anyway? You kind of went against your own argument there.
Typical NeoCon that can't read.
Reading would explain these things but NeoCons don't read they just spew forth garbage.
Originally posted by: dmcowen674
Typical NeoCon that can't read.The Governor felt he was forced to add the Tax onto Million dollar homes because the wealthy are not paying their fair share especially since they keep getting "Tax Breaks" from the Federal level.
Reading would explain these things but NeoCons don't read they just spew forth garbage.
Maybe you should go back to school and get the kind of education that will make you stop hating people that have the potential to make some money. In the process, perhaps you may improve your analytical skills. You think the governor felt like taxing the wealthy because he felt that the rich were getting federal tax breaks. I don't see where the article even remotely implies such a thing. Perhaps you enjoy reading into facts with your biases.
Let's look at this situation. State wants more funding - nothing new here. What do they need to do? Increase taxes of course. Who should they hit with increased taxes? Why not find a tiny minority that doesn't have a chance in hell of affecting an election result? So they target people who might buy homes costing $1 million. This affects the state's 9,900 millionaires and maybe an additional 80,000 people who might be able to afford a $1 million home. Easy money, plain and simple. What kind of government doesn't want easy money? There's no implied Robin Hood philosophy at all here.
See also this fact taken from the article you linked to:
Making up some alleged motivation to suit your argument is quite weak at best and downright misleading at worst.
Another thing this governor with alleged Robin Hood tendencies has gone and done is increase the taxes due on property sale that affects pretty much anyone in NJ that can afford to buy a home over there. If we followed your line of thinking then, he did it because he felt that the middle class people that bought their homes decades ago when prices were low should be hit with an extra tax when they decide to sell their homes because he feels that they aren't taxed enough. Maybe we could say that he doesn't care what the small fraction of the population that will be selling their homes this year think about his policies. Again, easy money.
The simplest explanation is usually the right one. Perhaps people should spend less time whining and more time improving their skills so they can make that money they envy so much.
BTW, stop commenting on my reading comprehension skills and work on yours.
Bitek
Lifer
- Aug 2, 2001
- 10,647
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Originally posted by: dmcowen674
Typical NeoCon that can't read.The Governor felt he was forced to add the Tax onto Million dollar homes because the wealthy are not paying their fair share especially since they keep getting "Tax Breaks" from the Federal level.
Reading would explain these things but NeoCons don't read they just spew forth garbage.
You've obviously never loked at some of the real estate in NJ. Townhomes can run upto $1M when you get close enough to the city (unless you want to live in Newark...)
Originally posted by: Hafen
Originally posted by: dmcowen674
Typical NeoCon that can't read.The Governor felt he was forced to add the Tax onto Million dollar homes because the wealthy are not paying their fair share especially since they keep getting "Tax Breaks" from the Federal level.
Reading would explain these things but NeoCons don't read they just spew forth garbage.
You've obviously never loked at some of the real estate in NJ. Townhomes can run upto $1M when you get close enough to the city (unless you want to live in Newark...)
So, what's your point? I used to live up that way and still have family in Newark in fact.
Originally posted by: Hafen
Originally posted by: dmcowen674
Typical NeoCon that can't read.The Governor felt he was forced to add the Tax onto Million dollar homes because the wealthy are not paying their fair share especially since they keep getting "Tax Breaks" from the Federal level.
Reading would explain these things but NeoCons don't read they just spew forth garbage.
You've obviously never loked at some of the real estate in NJ. Townhomes can run upto $1M when you get close enough to the city (unless you want to live in Newark...)
Or Irvington.
Sorry but if u can even remotely afford a million dollar home, you can afford to pay a higher tax on it. How the tax works is:
1) A higher tax on 1M+ homes marginally decreases the demand for $1M homes
2) Some cannot afford the higher tax and foreclose, creating more supply of $1M homes.
3) Net result of more supply and less demand is that the housing prices become more accurate (they drop) below the $1M mark, and hence no more tax!! Problem solves itself.
By making homes too affordable, it allows prices to skyrocket. Take Japan for example, prices are so high, that many can only afford 100-year mortgages (yep, a mortgage longer than most of them will ever live).
But that 100yr mortgage makes it rather easy to own property, combine with low (and sometimes negative) interest rates, and hence, property prices are very hard to decline.
1) A higher tax on 1M+ homes marginally decreases the demand for $1M homes
2) Some cannot afford the higher tax and foreclose, creating more supply of $1M homes.
3) Net result of more supply and less demand is that the housing prices become more accurate (they drop) below the $1M mark, and hence no more tax!! Problem solves itself.
By making homes too affordable, it allows prices to skyrocket. Take Japan for example, prices are so high, that many can only afford 100-year mortgages (yep, a mortgage longer than most of them will ever live).
But that 100yr mortgage makes it rather easy to own property, combine with low (and sometimes negative) interest rates, and hence, property prices are very hard to decline.
Genius, no one "owns" a damn thing, they're all perpetual "renters". Japan has turned Communist. No big deal, we're turning Communist too. The very thing the U.S. fought off for so many years last Century and now embraced.
Honestly, the demand for million dollar homes is inelastic enough to not change by anything more than an insignificant degree due to a 1% tax increase.
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