New BC Political Discussion - POST BC Election 2017

[misher]

Originally Posted by WarrenC12

LOL what?

As for the 0-100 example, of course that's true, but it's meaningless.

Now prove to me that we've set taxes high enough to reduce revenue? The economists working at the Ministry of Finance have predicted an increase of ~$200M from this additional tax bracket alone. Do you disagree with them?

FYI, here's what trickle down means:

Lol they did an absolute and didn't account for any decreases due to increases in tax avoidance or increased tax mitigation. If you don't account for human behavior its obvious your numbers are flawed and made to score political points. Same goes for their last budget that predicted increases in real estate sales even after their new Speculation and School taxes.

And its not meaningless, I just proved that the curve you said was bullshit is real.

And the concept behind trickle down is that if you give someone more money they will spend more and pay people more. The same concept can be applied to governments, people assume if we pay them more taxes they will spend more and pay people more. Unfortunately the trickle down concept is not 100% for both the private and public sectors. More taxes is not necessarily better.

[WarrenC12]

Originally Posted by misher

Lol they did an absolute and didn't account for any decreases due to increases in tax avoidance or increased tax mitigation. If you don't account for human behavior its obvious your numbers are flawed and made to score political points. Same goes for their last budget that predicted increases in real estate sales even after their new Speculation and School taxes.

And its not meaningless, I just proved that the curve you said was bullshit is real.

And the concept behind trickle down is that if you give someone more money they will spend more and pay people more. The same concept can be applied to governments, people assume if we pay them more taxes they will spend more and pay people more. Unfortunately the trickle down concept is not 100% for both the private and public sectors. More taxes is not necessarily better.

How the hell do you know?

Trickle down is bullshit. Bullshit. Bullshit.

[chowhou]

I gotta say, this is the first time I've seen government tax policy equated to "trickle down economics".

There are two things people always forget when it comes to economics: Confounding variables and time dependence. The market doesn't adjust immediately, and different markets have different things affecting them. Frankly, I'm a little bit offended that misher has been comparing the Canadian/BC economy to Russia's economy. There's also the factor that flat taxes are intrinsically regressive. Even if we assume that flat taxes are the best way to raise revenue, you're still going to crush people with low incomes under your gold boots.

The reality behind trickle down economics is that the rich get richer and the poor get poorer. In general, rich people aren't dumb. If you give a smart investor $100,000, he or she is going to re-invest the money for their own gain, not hire a personal chef or buy 50,000 happy meals. Maybe they go to A&W instead.

On top of that, literally none of the "laugh"er curve assumptions are guaranteed fact. Neither 0% nor 100% tax rates guarantee zero revenue, nor are they necessarily the worst option. There is no guarantee that the curve has a single maximum. There is no guarantee that there are two minima at 0% and 100%.

You want to know how this is going to affect the economy? You want to know how the NDP should find out the effects of this change? Check back on the BC government and BC economy in 10 years.

[Migrant_Coconut]

Yeah, the only things Laffer got right were 0% and 100%; everything else is a tossup.

For definitive proof that marginal rates don't affect overall tax revenue, just look at the States over the last hundred years. Tax cuts for the wealthy change absolutely nothing except the amount of money they have... unless misher wants to argue that the optimum marginal tax rate is 95%?

Originally Posted by chowhou

Even if we assume that flat taxes are the best way to raise revenue, you're still going to crush people with low incomes under your gold boots.

Correct. Income is an exponential curve, so taxes should be too.

Originally Posted by misher

If trickle down didn't work, then you wouldn't want to pay the government more taxes in the hopes it ends up in the pockets of us. Demands to pay more taxes so that they end up lower is trickle down economics.

Paying more taxes to get less taxes is a double negative: the two cancel each other out. What we do is pay more in order to get more spending on things that benefit us, which we can't get on our own.

The government works for the people. The wealthy work for themselves.

[Hmoob]

I'm with let's wait and see on how the income tax plays out, but here's a thought experiment.

The hypothetical person (James) who might leave or decline coming to BC because of this tax is probably looking at metro Vancouver (sorry Terrace) as their home. Whatever values and priorities James has, we know he cares about money in that this tax may influence his decision. We should look at the cost of the tax in the context of the whole financial picture; comparing Vancouver to other locations he might chose.

The biggest thing that stands out is our cost of housing. James makes good money and will want a house in West Vancouver. It's going to cost him more than $75,000 annually for the mortgage on that. That could buy a pretty nice place in any number of locations. Unless he's considering Silicon Valley or Hollywood Hills for comparison, we've already lost him.

The marginal tax on his earnings above $220,000 could be the last straw, but it's a small piece of the equation. It's especially so if we consider how he might value, or not value, all of the other tangible and intangible aspects of living in Vancouver vs. elsewhere.

[Migrant_Coconut]

That's fair, but we shouldn't necessarily compromise our capital projects (main reason for the budget increase) just for the possibility of getting James to live here. Better to lure him by bringing housing prices down and improving his commute.

[Hmoob]

Originally Posted by Migrant_Coconut

That's fair, but we shouldn't necessarily compromise our capital projects (main reason for the budget increase) just for the possibility of getting James to live here. Better to lure him by bringing housing prices down and improving his commute.

Exactly

Vancouver's amenities and urban vibrancy are key assets we have to offer. Some people will value them, others won't. Warren Buffet is happy to live in Omaha. He's not considering moving here, no matter how low we drop our taxes.

Let's play to our strengths. There are plenty of low tax locations we don't need to race to the bottom against.

[cabotp]

Originally Posted by Hmoob

I'm with let's wait and see on how the income tax plays out, but here's a thought experiment.

The hypothetical person (James) who might leave or decline coming to BC because of this tax is probably looking at metro Vancouver (sorry Terrace) as their home. Whatever values and priorities James has, we know he cares about money in that this tax may influence his decision. We should look at the cost of the tax in the context of the whole financial picture; comparing Vancouver to other locations he might chose.

The biggest thing that stands out is our cost of housing. James makes good money and will want a house in West Vancouver. It's going to cost him more than $75,000 annually for the mortgage on that. That could buy a pretty nice place in any number of locations. Unless he's considering Silicon Valley or Hollywood Hills for comparison, we've already lost him.

The marginal tax on his earnings above $220,000 could be the last straw, but it's a small piece of the equation. It's especially so if we consider how he might value, or not value, all of the other tangible and intangible aspects of living in Vancouver vs. elsewhere.

To me the fear that we may see a bunch of rich people move a way or not move here, because of small increase in there taxes. Is simply a scare tactic used by the rich to keep their income taxes lowered. They use it to scare the poor person into thinking their boss will move away and the poor person will loose their job

As well even if James decides to not move here. Chances are Jim will want to move and take James place. There is alway someone willing to replace someone.


In regards to "trickle down economics." It simply doesn't work because humans are greedy.

[misher]

Originally Posted by cabotp

To me the fear that we may see a bunch of rich people move a way or not move here, because of small increase in there taxes. Is simply a scare tactic used by the rich to keep their income taxes lowered. They use it to scare the poor person into thinking their boss will move away and the poor person will loose their job

As well even if James decides to not move here. Chances are Jim will want to move and take James place. There is alway someone willing to replace someone.


In regards to "trickle down economics." It simply doesn't work because humans are greedy.

There is data from America showing that people flee from high tax to low tax states. New York and California have lost a lot of tax income due to their high state taxes. So there is evidence that this exists. Similar examples can be seen with the exodus of the wealthy from France and Sweden at one time.

[Changing City]

Originally Posted by misher

There is data from America showing that people flee from high tax to low tax states. New York and California have lost a lot of tax income due to their high state taxes. So there is evidence that this exists. Similar examples can be seen with the exodus of the wealthy from France and Sweden at one time.

The data is out of date, and from an organisation generally critical of tax increases and high taxation.

In 2018 for example, while there was still a net outflow of high earners from New York, and a net gain in Florida (which didn't benefit much because there is no state income tax there), California saw almost no outflow of income.

It's also an inaccurate portrayal, because if someone earning $500,000 a year for a bank in New York retires and moves to Florida, that's shown as a loss of income in New York, and a gain in Florida. Provided the bank appoints someone else at a $500,000 salary, there's no actual loss of income tax in New York at all. New York State's population isn't falling - neither is California's.

Where would these wealthy BC residents move to? Sunny Saskatchewan? Job-bleeding Alberta? Ontario, where the top tax rate is almost identical to the top tax rate we'll see in BC?

[misher]

Originally Posted by Changing City

The data is out of date, and from an organisation generally critical of tax increases and high taxation.

In 2018 for example, while there was still a net outflow of high earners from New York, and a net gain in Florida (which didn't benefit much because there is no state income tax there), California saw almost no outflow of income.

It's also an inaccurate portrayal, because if someone earning $500,000 a year for a bank in New York retires and moves to Florida, that's shown as a loss of income in New York, and a gain in Florida. Provided the bank appoints someone else at a $500,000 salary, there's no actual loss of income tax in New York at all. New York State's population isn't falling - neither is California's.

Where would these wealthy BC residents move to? Sunny Saskatchewan? Job-bleeding Alberta? Ontario, where the top tax rate is almost identical to the top tax rate we'll see in BC?

America as has been the usual.

Alison Bodine, Organizer of the Vancouver Protests. An American Employed by Prism Engineering an Energy Competitor to LNG.

[deported back to America in 2007](https://www.theglobeandmail.com/news...article696853/)

[her linked in page ](https://ca.linkedin.com/in/alison-bodine-977b8a64)

A small engineering company based around saving money for companies by converting buildings to electrical heating doesn’t want a cheap supply of LNG.

I really hate when foreign and corporate interests pretend to take the high ground to make a buck. Obviously a massive conflict of interest for her to be organizing protests that financially benefit herself and her company.

[CanSpice]

Originally Posted by misher

Lol I took intro to finance among others. I know what they mean.

I'm assuming that by dodging the question about marginal vs effective tax rates you don't actually know what they mean.

[Changing City]

Originally Posted by misher

Alison Bodine, Organizer of the Vancouver Protests. An American Employed by Prism Engineering an Energy Competitor to LNG.

[deported back to America in 2007](https://www.theglobeandmail.com/news...article696853/)

[her linked in page ](https://ca.linkedin.com/in/alison-bodine-977b8a64)

A small engineering company based around saving money for companies by converting buildings to electrical heating doesn’t want a cheap supply of LNG.

I really hate when foreign and corporate interests pretend to take the high ground to make a buck. Obviously a massive conflict of interest for her to be organizing protests that financially benefit herself and her company.

Squirrel!

[theman23]

Interesting that revenue was expected to be down 3% if it wasn't for this tax hike - does that mean annual incomes actually fell in B.C. last year?

[Migrant_Coconut]

Originally Posted by misher

There is data from America showing that people flee from high tax to low tax states. New York and California have lost a lot of tax income due to their high state taxes. So there is evidence that this exists. Similar examples can be seen with the exodus of the wealthy from France and Sweden at one time.

Then Hawaii, Oregon and Vermont should all be deep maroon instead of green - they've got the 2nd, 3rd and 7th highest marginal rates in America.

[a very long weekend]

Originally Posted by misher

Russia is a great example of a nation that lowered taxes and saw huge gains.

!!

[WarrenC12]

Originally Posted by theman23

Interesting that revenue was expected to be down 3% if it wasn't for this tax hike - does that mean annual incomes actually fell in B.C. last year?

It could be because BC had a year of "double dipping" as they were phasing out MSP and phasing in an employer health (payroll) tax to replace it.

I think last year the EHT was applicable all year, and MSP was somewhere at 50% or less of old rates.

[misher]

Originally Posted by WarrenC12

It could be because BC had a year of "double dipping" as they were phasing out MSP and phasing in an employer health (payroll) tax to replace it.

I think last year the EHT was applicable all year, and MSP was somewhere at 50% or less of old rates.

Property transfer tax revenues are down over half a billion too I believe. Also now that assessments are much lower school aka wealth tax revenue will be lower.

[whatnext]

Looks like Wilkinson managed to get one albatross off his neck:

Langley Liberal MLA Rich Coleman announces retirement from politics

[bluefox]

Originally Posted by whatnext

Looks like Wilkinson managed to get one albatross off his neck:

Langley Liberal MLA Rich Coleman announces retirement from politics

He'll find a nice quiet tropical landing spot with no extradition agreement (or maybe already has, judging by how oddly quiet he's been the last few months).