Comment 112141

By kevlahan (registered) | Posted June 09, 2015 at 16:46:14 in reply to Comment 112139

When I said tax on capital, I didn't mean just capital gains tax, I meant all taxes on income derived from capital (e.g. dividends, rental income, etc.).

Your example treats only speculative windfall capital gains (where the value of your capital rises through no effort on your part).

And, of course, in most cases we're talking about investors investing money and paying tax on the income they derive from their investment. It is investors investing in someone else's business.

And it is simply not true that the "economy would collapse" if you taxed income at the same rate as labour. In France, capital gains are taxed at total rate of 34.5% and income taxes are only 30% for incomes up to 71,000 euros (with income splitting allowed for spouses and with children). And France has a GDP per capita similar to the UK and one of the biggest economies in the world. Germany (no slouch economically) has a similar tax structure.

http://en.wikipedia.org/wiki/Tax_rates_o...

compares capital gains and income tax rates for European countries. Many countries have capital gains rates in the 20%-35% range, similar to typical income tax rates.

Comment edited by kevlahan on 2015-06-09 16:51:10

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