Why is income taxed differently and why is this not seen as an unfair situation? For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%. Yet if you earn your income through investments you are taxed a flat 15%.
The government logic is that it's the difference between income and at risk capital. Income is owed as earned. Capital can be completely lost, which happens more than you realize. The lower tax rate on Cap Gains is due to the long term nature of investments and their importance to economic growth (which enables income producing jobs). IMO, income taxes should be low and the same flat rate for everyone, and capital gains should not be taxed. The income which produced the capital has already been taxed once. And given the way the government continues to destroy the value of the dollar, taxing gains which are often just barely keeping up with inflation (if that) is adding insult to injury.
So? Why do you people keep babbling about that? Of course it's already been taxed once and it won't be taxed again. Only the profits will be taxed. Now, moving along, where is the fairness in charging on tax rate for one type of income vs. another tax rate for another type of income?
Because the rate of return would diminish if taxes increased, thus the incentive to invest/risk also diminishes.
Good question. Why is some income taxed at 10% and some at 35%? That seems unfair to me. What about the income that isn't taxed at all? You know, those 47% that file a return and pay nothing at all. That doesn't seem fair to me either.
If you invest $100 and make a 10% return in 5 years, but the inflation has been over 10% over that same period, why should the government tax your "phantom" profits which haven't even kept up with inflation?
Look at that. More jealousy of the lower middle class and poor. Way to set your bar high. You jealous of the homeless too? I mean, they get out of paying income AND property taxes. Class envy on full display.
