Seattle City Council Unanimously Approves Income Tax For the Rich (geekwire.com)

reifman writes: Amazon, tech employees and those making $250,000 or more annually in Seattle will now pay a 2.25 percent income tax. "The Seattle City Council estimates that the tax would bring in an additional $140 million each year," reports GeekWire. "The revenue would go toward the city's housing affordability agenda and carbon reduction goals and supplant federal funds if they are cut. The revenue is also intended to alleviate the burden of Washington's property and sales taxes, which are often called the most regressive in the country." Anyone who's seen Amazon's impacts on Seattle and its low and middle income residents will appreciate how this tax will help the homeless, lower income and improve the environment. Not everyone is thrilled with the recently approved legislation. Jason Mercier, who directs the center for government reform with the Washington Police Center, said: "[The council is] going to unanimously adopt an illegal income tax that has no hope of taking effect and will waste taxpayer resources on litigation the city is sure to lose." The measure is expected to be challenged in court, as Washington's constitution states "a county, city, or city-county shall not levy a tax on net income." According to The Washington Post, Mercier said there is decade of case law saying that a graduated income tax is unconstitutional because income is property and under the constitution, property tax has to be taxed uniformly and no more than 1 percent.

Comments

$250K is the definition of the evil 1%

[turkeydance]

according to Seattle. 251 is even eviler.

Re:$250K is the definition of the evil 1%

[halivar]

$250K will get you a cup of joe in Seattle.

Re:$250K is the definition of the evil 1%

[cayenne8]

$250K will get you a cup of joe in Seattle.

Yeah, that was my first thought, when did $250K a year define you as rich?

Sure in many parts of the US, that is a lot of money and you can live comfortably...but not excessive.

But in other parts, that is NOT a high salary....especially in the larger metropolitan areas on the east and west coast.

I don't think you should have to supplement people to live in a city...either you can afford to live there, or you can't...the US is plenty large enough, with cities and places that don't cost an arm and a leg, and yes...there are jobs there.

Re:$250K is the definition of the evil 1%

[Anonymous Coward]

This is ridiculous, how pampered are you? $100k might be pushing it, but $250k for an INDIVIDUAL is most definitely "rich", and if you feel threatened by it, good.

Re:$250K is the definition of the evil 1%

[sunking2]

Maybe its more that you'r definition of rich has become too strict. 250k puts you into a $1M house easier than a $250kat $100k.

Re:$250K is the definition of the evil 1%

[Anonymous Coward]

$250K is plenty. I make half that, and live in the Seattle area, and I'm quite comfortable. Big house, 3 cars, 2 kids in private school. By the standards of a spoiled brat I'm just middle-class, but by any sane definition, I'm well-off. $250K a year in Seattle is rich, and anyone who says otherwise just needs to adjust their expectations.

Re:$250K is the definition of the evil 1%

[epyT-R]

Why good? Are you saying he didn't earn that money?

Re:$250K is the definition of the evil 1%

[geoskd]

Yeah, that was my first thought, when did $250K a year define you as rich?

In *every* part of the US, that will define you as rich. If you can afford a $50,000 car, you are rich. If you can afford a 2000+ sqft home, you are rich. If you can afford to buy a decaf latte grande every day, you are rich. *Most* americans live paycheck to paycheck and are vastly in debt. Slashdotters are not typical people. Moreover, most slashdotters don't even know anyone who isn't rich. They will live in a rich neighborhood, and work with rich people, and buy everything online, or from stores staffed by the children of rich people. On the rare occasion when they do go into a walmart, they look at the cashier with pitty thinking that these are the only poor people. They never see the 5,000 people who would kill just to get that walmart job. They never see the people working the warehouse jobs, or the folks living in the places where you joke about being unsafe to drive at night. They simply don't understand that their world is the exception not the rule.

The other side of that are the working class and poor. They know the rich exist, but they never see them, they never get to go into those neighborhoods. Their kids don't go to the same schools with the rich kids so they never have a reason to meet with the rich parents at PTA meetings (assuming they could even get enough time off work to go).

The simple truth is there are two Americas. There is the one you live in, and the one they live in. I sincerely hope you never have to live in their world because it is a pale shadow of the America you live in. In spite of that fact, their lifes work means you can get your stuff cheap online and in store. They buy the products that directly or indirectly fund your huge paychecks. In a very real sense, they are very nearly modern day slaves who's entire existences fuels your lifestyle.

The average American watching TV is looking at a lifestyle that is beyond their own. They can only aspire to have the kind of wealth they see on their nightly sitcoms and dramas, but they watch anyways always dreaming that they live those lives instead of their own.

I could give you a million places to look where you could peel back the veil of abject poverty and see the new slave class this country has embraced, but it is probably better that you continue to live the fantasy so that you can pursue the things that just might actually make a better tomorrow for everyone. If you had to face the demons that comes with your own wealth, it might destroy the fragile innocence that allows you to sleep at night.

Re:$250K is the definition of the evil 1%

[Fire_Wraith]

What I'd want to know that the article doesn't state is whether that's a marginal tax, or a total tax.

When it comes to federal income tax at least, the rates are all marginal. The top tax rate is 39.6%, but that doesn't mean if you make $500k you're paying 39.6% of that. Rather, you only pay 39.6% of everything you make over the limit. You'd pay 10% on the first $9325, 15% on $9326 to $37,950, etc etc on up the scale. You only pay 39.6% of the last $81,599, since the 39.6% kicks in at $418401+ (as of 2017 at least).

So if it's 2.25% of everything over 250k, that's not going to kill anyone making that sort of money, because the guy making $251k owes exactly $22.50.

Re:$250K is the definition of the evil 1%

[nasch]

$200K would put you in the top 13% of households in Seattle. Not sure where 250 would be.

http://www.city-data.com/incom...

Re:$250K is the definition of the evil 1%

[RabidReindeer]

Income is "property"? I thought it was the state next door that had legal cannabis.

Sounds like there's a whole slew of existing laws that counter this new one, but equating a cash flow with static assets makes the "corporations are people" concept seem downright pedestrian. At least corporations do some of the same things that people do, even if the State of Texas has yet to administer lethal injections to one.

Re:$250K is the definition of the evil 1%

[Anonymous Coward]

would kill just to get that walmart job.

Hyperbole much? If you can't make your case without resorting to exaggeration then perhaps your case is not so strong.

Re:$250K is the definition of the evil 1%

[amiga3D]

It's not rich. RIch people don't have to work. That's rich. Rich people have people to do their yards, clean their pool, cook their food, clean their houses and drive them where they want to go in a car that cost more than I'll make in my lifetime. That's rich. 250K is living comfortably with no worries.

Re:$250K is the definition of the evil 1%

[GrumpySteen]

It's marginal. Here's an article with a bit more detail

So yeah, Mr. $251k owes $22.50.

Re:$250K is the definition of the evil 1%

[swillden]

*Most* americans live paycheck to paycheck and are vastly in debt

This is true, but except at the very bottom it has almost nothing to do with income. Plenty of people making >$250K also live paycheck to paycheck and are vastly in debt. Whether or not you're living at the edge of your finances has much less to do with how much money you earn than it does how you spend. I know families of six that live on $25K annually and have money in the bank and no debt other than the mortgage on their (old and very small) house. I know DINKs that have combined incomes of $400K annually but every cent is pre-spent, and any unexpected expenses go on credit cards. There's a *huge* difference in the way those people live; the difference is larger than $375K per year, because the former live below their meager means while the latter live above their ample means.

Being rich or poor is somewhat determined by choices and effort, but mostly determined by luck. Living paycheck to paycheck, however, is almost always due to choices. Note that I said "almost", because there are exceptions; cases where people who do live below their means get slammed with some impossible expense (e.g. medical expenses) which sucks up their savings and leaves them with unmanageable payments, perhaps garnished from their wages. There are also people who live on disability income which will evaporate if they save any money (stupid, stupid policy). But *most* Americans who live paycheck to paycheck do it by choice, though few of them believe it. But have them sit down with a decent financial planner who will help them identify where their money goes, optimize it (which may involve moving, since many are house-poor), and create a budget that enables them to save, and they can stop living that way.

Personally, I used to live paycheck to paycheck, on a $100K income, until I realized that I was being stupid and took control. Granted that it's a lot easier to take control of your finances with $100K income than with $25K income but it's totally possible for the vast majority even at the bottom end of that range. There is a point below which living just about becomes impossible, of course.

Re:$250K is the definition of the evil 1%

[CaptnCrud]

Its really depends on your lifestyle and how good you are with your money. Factors, like kids, marriages, do you need new shit all the time, are you a compulsive buyer or are you complete coal smuggler.

I've found that how you spend ends up dictating your financial situation almost as much as your salary.

Re:$250K is the definition of the evil 1%

[TranquilVoid]

Given the tax is on individuals I imagine $250k would easily place you in the top 1%.

Using a very conservative assumption that the highest Seattle income is $250k;

- Seattle population: 705,000
- Estimated new tax revenue: $140,000,000
- New tax rate: 2.5%

    140,000,000 / ( 250,000 * 0.025 ) = 22,400 people earning $250k
    22,400 / 705,000 = 3.2% of the population

Re:$250K is the definition of the evil 1%

[TranquilVoid]

Just realised 705,000 is the CBD population. Not sure the population to which this tax law would apply but it could be up to 4,500,000 people, making the ultra-conservative calculation more like 20%.

Re:$250K is the definition of the evil 1%

[Magius_AR]

In *every* part of the US, that will define you as rich. If you can afford a $50,000 car, you are rich. If you can afford a 2000+ sqft home, you are rich. If you can afford to buy a decaf latte grande every day, you are rich.

So, if that is your definition of "rich", what do you define Warren Buffet and Bill Gates as? Because I assure you their lifestyles are way different than a 2000+ sqft home and a latte every day.

The simple truth is there are two Americas. There is the one you live in, and the one they live in

No, there's in fact alot more Americas then that, but for some reason you people just love forgetting an actual "rich" exists, by calling most of the working class "rich" and just lumping in the billionaires, as if those two classes are even remotely comparable.

Re:$250K is the definition of the evil 1%

[XopherMV]

If you can afford a 2000+ sqft home, you are rich.

Bullshit. Middle class people can afford 2000+ sqft homes throughout the US. That doesn't make them rich.

If you can afford to buy a decaf latte grande every day, you are rich.

Again, bullshit. A latte is $3. It's not fucking Patrón. Middle class and poor folk buy lattes every single day. It doesn't make them rich.

Re:$250K is the definition of the evil 1%

[aiht]

Your math is very wrong. FTFA: 10k ppl=$140m, that is 14,000 per person, averaged. Said another way, 250,000*.0225=$5625.

Are you completely ignoring the fact that this discussion thread right here is about the tax being marginal?
The only way it makes any sense to calculate 2.25% of 250K is if someone makes $500K, so they make 250K over the threshold.
The average 14K pp estimate suggests that the average wage they're looking at is 14,000/.0225 = ~620K ABOVE the 250K threshold, so $870K/yr.

Re:$250K is the definition of the evil 1%

[Anonymous Coward]

While I agree that $250K is not rich, my family income is a bit below that (~230k) and we still hire everything you listed done for us, except the driving part And of course, all of ours cars do not add up to more than 200,000. I wonder how much you expect to make in your lifetime... the average lifetime earnings with a bachelor's in the US will buy you a Koenigsegg One.

By the way, I live in the greater LA area, which does not exactly have a low cost of living.

Re:$250K is the definition of the evil 1%

[DontBeAMoran]

$3 multiplied by 365 days equals $1095. If you make around $25K that means you'd be wasting 4% of your annual income on coffee. Get real.

Re:$250K is the definition of the evil 1%

[silentcoder]

The trouble is that those on the low end INVARIABLY end up with some huge and impossible expense. Because life just throws that shit at people. And when you've never earned enough to cover more than the basics, saving money has never really been an option - and the expenses that dumb luck throws your way are usually bigger than you could ever possibly cover with those savings, so debt becomes the only option - and even those who had spent years or decades being responsible are driven to abject poverty by dumb luck.
You mentioned medical expenses but there are so much more - a 45 dollar parking ticket you can't pay, handed over to a private debt collector firm will likely end up being 3000 dollars or more by the time you manage to pay it off. That only ever happens to those who don't have the 45 dollars when the ticket comes of course. This happens with alarming frequency in America.

And of course, crap luck tends to come in bunches. I am a high-earner - and I was nearly destroyed by a series of bad luck events. It started when my daughter needed a life-saving operation -and the insurance refused to pay. Massive bill - and it had to go on a credit card that was only supposed to exist for emergencies (no remember - I was debt-free the month before). That same month my car's engine blew up - and since I have to get to work and have no feasible public transport in my city, that had to be paid on the credit card too. A few more bad things happened -and within 3 months I went from zero debt to owing roughly 5 times my monthly salary in short-term debt - most of it credit card debt.

Suddenly debt repayments was eating up 2/3rds of my monthly income - leaving just barely enough to cover the bills and food. I was actually shifting food money into a seperate account on payday so that, if I fall short, I guarantee my family can eat even if that means missing a bill !

I was lucky though - being a high earner I had made investments, specifically I owned an appartment in a very expensive neighbourhood which I was renting out. In the end - that gave me a way out of this debt trap. I sold the apparthment AND my house, and bought a nicer, bigger house which was, nonetheless, cheaper than the combined value of both properties - sufficiently so that I was able to pay of all the debt. I now only owe my house bond and my car financing. But how many of those 25K a year people do you know who own an upscale appartment to rent out ?
And of course, the price I paid for my decision was to lose that valuable investment. That appartment was worth far more in rental income over the long term than it would ever sell for. I had to cash in the smaller value, because that money comes today.
That income was supposed to be part of my retirement, now I'll have to make that up with other investments and hope I never again end up with a series of bad luck bills that force me to use up all my savings, go into debt and cash in my investments to survive.

Re:$250K is the definition of the evil 1%

[hawguy]

Rich people have people to do their yards, clean their pool, cook their food, clean their houses and drive them where they want to go in a car that cost more than I'll make in my lifetime. That's rich. 250K is living comfortably with no worries.

You've just described a well paid techie's life in Seattle or the SF Bay Area

They buy a townhouse or highrise condo, so someone else takes care of the landscaping; the pool cleaning is included in the HOA; they get free food at work and when they are at home they get meals delivered; they have a cleaning service come once a week to clean the house; they have their Uber driver take them where they want to go.

I don't make nearly $250K but could lie such a lifestyle if I chose.

Re:$250K is the definition of the evil 1%

[hawguy]

would kill just to get that walmart job.

Hyperbole much? If you can't make your case without resorting to exaggeration then perhaps your case is not so strong.

"Would kill to..." is a common figure of speech, so not really exaggeration. And the sentiment is true - in many areas of the country, working at walmart is a lucrative job and something to aspire to. Sure beats rinsing blood and guts out of the slaughterhouse (which was an actual job for unskilled laborers in the midwest town where I grew up)

Re: $250K is the definition of the evil 1%

[Anonymous Coward]

Since when does milk contain caffeine?

Since they started putting coffee in it.

Re:$250K is the definition of the evil 1%

[Gavagai80]

If you can afford a 2000+ sqft home, you are rich.

Only in the big tech cities. There are plenty of places in the USA where you can get a 2000+ sqft home for under $100K.

*Most* americans live paycheck to paycheck and are vastly in debt

In America, vast debts are a luxury of the rich. As a poor person, I've never been in debt at all -- nor been offered the opportunity. I've never lived paycheck to paycheck either, because I can't risk being homeless like the wealthy can risk having their limo and mansion repossessed.

Re:$250K is the definition of the evil 1%

[schleimkeim]

Are you perhaps saying that not everybody is entitled to a top notch cellphone, a laptop, a tablet for the toilet and a brand new car? As well as new clothes every other week? YOU MONSTER!

Re:$250K is the definition of the evil 1%

[Ecuador]

The simple truth is there are two Americas. There is the one you live in, and the one they live in.

Wait, I thought it's North America and South America?

Re:$250K is the definition of the evil 1%

[bluefoxlucid]

You want to know something fun? We can actually remediate most of the problems in the welfare system and get a big tax cut on everybody with the top tax bracket ending up at 34.8%. Corporate income taxes (35%) become 32.5%; payroll taxes drop by a marginal 0.9%.

A two-adult household starts out with $17,502/year of untaxed income (as in, sans-job); a single-income household at $200,000 has about $2,700 more income after taxes than today, and every household with more or less income than that comes out further ahead. 75% of qualified HUD housing assistance applicants land on a waiting list and never receive benefits; instead, these households would have supplemental income, and HUD can top them up with a much-smaller subsidy besides. Unemployment insurance becomes unimportant; OASDI will never have solvency problems (real or imagined); taxes to support this will never need to increase (beware politics); and TANF, WIC, and SNAP can focus their mission on supporting children of low-income households.

Everyone's ideal is to go tax the rich as their first action. Nobody plans. This above plan? With 485,582 adult residents in Baltimore City at an average income of $25,707, there's an extra $3.16-$3.66 billion of spendable income coming to Baltimore. That elevates the average income to $32,220-$40,785, median $48,754-$57,319. This represents a sudden demand for employment equivalent to 190,000-220,000 full-time minimum-wage jobs (fewer relative to the average wage).

With Seattle's 595,882 at an average $45,673, they're looking at $4,500-$5,000 per person single, about $5,800 per person married. Range it as an extra $2.68-$3.46 billion. That money's not supposed to be taxed as an income tax; it gets spent, which is suddenly income, and what have we here... a revenue source?

It's not quite $140 million (not unless you capture 4% in taxes off this new money), but it's there.

Re:$250K is the definition of the evil 1%

[Mr D from 63]

I could give you a million places to look where you could peel back the veil of abject poverty and see the new slave class this country has embraced,

"embraced"? Just because something exists doesn't mean it is 'embraced'. I guess we've 'embraced' wife beating as well, cause if you peel back the veil......

But you are right, we should be more like those countries that has no lower class producing products that are consumed by the more wealthy. Which country was that again? I like how people ignore the entire history of human civilization and blame our social makeup on the people doing the best in it today. I'd rather be a poor person today than a middle class person 150 years aqo. Its an oversimplification of a human condition issue, and it leads to oversimplified solution propositions like this tax.

Re: $250K is the definition of the evil 1%

[dougdonovan]

the one with the most toys wins and the female will win in a court of law so dont be stupid, do the prenup, its smart living and thats what she expects in legal writing. money talks, bs walks and keeps walking. forget the car keys. that is the definition of evil.

Re:$250K is the definition of the evil 1%

[ranton]

$250K is plenty. I make half that, and live in the Seattle area, and I'm quite comfortable. Big house, 3 cars, 2 kids in private school. By the standards of a spoiled brat I'm just middle-class, but by any sane definition, I'm well-off. $250K a year in Seattle is rich, and anyone who says otherwise just needs to adjust their expectations.

You border what would be considered the middle class and upper middle class boundary, since you have just under double the median income for a family with two kids in your area. A google search for affordable suburbs of Seattle brings up places like Kenmore, where a decent quality "large" (2500+ft) house runs you $650k at least. Two kids in private school (low end $2k/month) and a mortgage on a big house ($3k/month) leaves you only about $2500 per month for everything else on a $125k family income. While you could certainly make ends meet, that is hardly well off.

Something about your story is quite misleading. Perhaps you bought a house when prices were more reasonable, have 3 older completely paid off cars, or have a dual income which brings you above $125k family income. But it is completely disingenuous to claim $125k per year gives you the type of lifestyle you describe without significant sacrifices in other areas of your budget.

Re:$250K is the definition of the evil 1%

[kilfarsnar]

Given how frequent stories like this are in America, it always baffles me that Americans are so vehemently opposed to the kind of social healthcare enjoyed by Europe. When even the rich can be stung badly by medical bills and uncooperative insurers, it seems odd that they would reject the idea of getting rid of the insurers, paying a similar amount in tax instead, and getting healthcare for everyone without the risk of people missing out or being shafted by their insurers.

I know it's all about that dreaded T-word. Americans hate the idea of being taxed. But really, the way things are set up now, you're effectively paying the same money to a private company. It may just as well be a tax.

The American mind is trapped by ideology and propaganda. We have a strong myth of the self-made man who pulls himself up by his bootstraps, without help from others. The very wealthy perpetuate that myth because it serves to insulate them from judgement about the degree of their wealth. The money a person has "earned" is theirs to do with as they please, regardless of how disproportionate it might be or whatever else might be true. You see this in the irrational anti-tax attitudes you mentioned as well.

The lower classes have also been conditioned to fight each other rather than band together. This is again by design. The owners have historically pitted groups against each other to keep them from uniting against a common enemy. So when people see public sector union workers (for example) getting benefits, they want to take those benefits away rather than ask why they also are not receiving those benefits.

What this means is that many people vote for values rather than policies. They vote for the person who will maintain or implement the proper order of things, as they see it. Basically, they are more concerned with making sure the next guy is as miserable as they are, than they are with creating a shared prosperity.

Re:$250K is the definition of the evil 1%

[werepants]

With $250k a year in income, you can become financially self-sufficient in a remarkably short amount of time, so yes, by your definition it still qualifies as "rich".

You just have to forgo the materialist treadmill of brand new luxury cars and similarly ridiculous lifestyle choices, invest that money instead, and you can be financially independent/retired in 5-10 years, easily.

Re: $250K is the definition of the evil 1%

[Anonymous Coward]

Let me guess... you are single.

I feel rich earning less than 35k a year.

I now earn more than 300k a year and feel that I have less financial freedom than before.

The big difference is that I am responsible for my family and mature enough to understand that I could lose my job someday and thus need to start saving.

I'm not saying family is the problem... the rewards are priceless.

And the reality is that earning more money simply reduces the financial stress in the family and I would imagine a lot more arguments if we have to struggle with bills to pay.

Re:$250K is the definition of the evil 1%

[computational super]

In five years, they'll lower the threshold to $150K, in another five years it'll be $50K, and a few years after that it will be everybody.

Re:$250K is the definition of the evil 1%

[strikethree]

I know families of six that live on $25K annually and have money in the bank and no debt other than the mortgage on their (old and very small) house.

I recognize you. You work at Google. I do not normally associate you with dishonesty...

However, you are either outright lying or not revealing the whole economic situation here.

I am trailer trash. I know poverty very well. There is absolutely no way that a family of 6 bring in $25k owns ANYTHING. You can not even buy health care for $25k for a family of 6. The premiums alone would take all of it. God forbid their children should need to actually use that healthcare insurance they bought. Between deductibles and uncovered items, 4 children will eat up thousands of dollars in medical bills.

Since I will choose to believe that you are not lying, I would *highly* recommend that you reevaluate your claims.

Have a nice day Sean.

Re:$250K is the definition of the evil 1%

[cyberchondriac]

If you can afford a $50,000 car, you are rich. If you can afford a 2000+ sqft home, you are rich.

That's not "rich", that's "upper middle class" in my area (I'm more middle-middle class). And there are plenty of drug dealers living in the hood who drive around in more expensive cars than that, yet their homes are hovels.. are they "rich"?

The simple truth is there are two Americas. There is the one you live in, and the one they live in.

And this is precisely where the argument breaks down and reveals it's class warfare aspirations. This genuinely is a case where American financial status is not "binary" but a spectrum of wealth or income. And while the middle class is shrinking, it still exists. . And to some degree in the middle, rich or poor are arbitrary and subjective definitions anyway.

Re:$250K is the definition of the evil 1%

[Immerman]

Did he work 5x longer or harder than the median Joe who only makes $51k? Or the guy working two full-time minimum wage jobs to make $32k?

Almost certainly not. He was in the right place at the right time, had the right connections, etc. Income in the US is based more on luck than effort or skill.

Re:$250K is the definition of the evil 1%

[parkinglot777]

It's not rich. Rich people don't have to work. That's rich. Rich people have people to do their yards, clean their pool, cook their food, clean their houses and drive them where they want to go in a car that cost more than I'll make in my lifetime. That's rich. 250K is living comfortably with no worries.

From TFA, it is unclear whether the $250k is for an individual or for a house hold. If it is an individual, I quite agree that it is for a rich (or lower bound rich). If it is for a house hold, I would say that it is not enough to be called rich...

Re:$250K is the definition of the evil 1%

[Dread_ed]

It doesn't define you as rich. What it does is provide a workable cutoff point for the government. Two items to consider:

1) As the government you want to make sure you don't offend too many people. You need popular support when you go to confiscate money from people. So, you set the bar where the number of people who are not affected is sufficiently large to garner support, or at the very least apathy, from a significant portion of the population.

2) As the government you want to make sure that when you institute a new tax you cast as wide a net as possible. You know that governments immediately spend projected taxation increases before a dime is even collected, and that additional spending over and above what is projected to be collected will be green lighted based on the passage of a new tax law. So, setting the bar at $250k is an acceptable loss for the government (they would prefer this tax apply to everyone, but they can't due to item 1 above) but there are still sufficient members of the $250k+ group to generate almost $150 million. When considering the number of people who earn over $250k the gradient runs downhill pretty steep as you climb above $250k, with fewer and fewer high income individuals. And since the point is to cast as wide a net as possible, this threshold works well for capturing more individuals in the taxation scheme.

Re:$250K is the definition of the evil 1%

[amiga3D]

I'm done working a steady job. I recently retired and don't plan on doing 6 to 3 kind of work ever again although I will be working different projects. I made 60K a year when I retired which is a lot of money where I live but isn't the lap of luxury. You really manage to hire cooks, maids and pool boys on 230K? You're pretty good with your money then. Or hiring illegals.

Re:$250K is the definition of the evil 1%

[Rob Y.]

Jesus, folks. $250K might not be 'rich' in the billionaire sense, but it's comfortable enough that in the scope of things anything above that is basically a pissing contest. To impose a 2.5 percent tax on the amount above (not on the first $250K) is a mosquito bite that those folks will barely feel. On the other hand, if it reduces the need to impose a higher sales tax, millions will feel relief every day. There's a reason for progressive taxation. You may not like it in principle - and you may not like what the money gets spent on. But don't kid yourself that a small tax on high income earners is the problem.

Re:$250K is the definition of the evil 1%

[amiga3D]

I rank living in a townhouse a couple levels lower than a trailer on a dirt road. But to each his own.

Re:$250K is the definition of the evil 1%

[Cederic]

most slashdotters don't even know anyone who isn't rich

I don't know anybody that is rich.

I have a higher disposable income than most of my friends, and I can't afford a Tesla, a house with a pool, a summer home, a property portfolio for future income.

I dance with people that car share to dance events because they can't afford the fuel themselves. My cleaner wont skip a week because the 90 minutes a week of earnings she gets from me are important to her family. I work with people that earn barely more than the minimum wage and buy coffee at work from people that do earn the minimum wage.

Maybe you live in an isolated little bubble but most of us are part of the real world. $250k/year feels pretty rich to me but I have no kids, don't pay $2000/week on a mortgage, didn't get married and divorced three times and don't feel the need to eat a pound of fillet steak every evening.

Well, scratch the last one. I'd rather enjoy that. It's just not within my budget.

Re:$250K is the definition of the evil 1%

[Cederic]

Last I heard Bill Gates' house was about the same size.

(as Omaha, Nebraska)

Re:$250K is the definition of the evil 1%

[Rob Y.]

Warren Buffet and Bill Gates are such outliers that they don't belong in this discussion at all. And the point of the two Americas meme is that in one of them, you don't get the most basic needs met, and in the other you do. Anything beyond that is fluff. In the case of Buffet and Gates, some very high-priced fluff. But non-essential fluff nonetheless.

Buffet and Gates seem to realize this - having pledged to give most of it away. It's those deluded folks that 'aspire' to be Buffet and Gates that don't get the point. You get to try to live a decent life, accomplish something, and then you die. And if you have any sense, you hope your kids will do the same - instead of inheriting a vast fortune and having no idea how to live.

Re:$250K is the definition of the evil 1%

[James Carnley]

In *every* part of the US, that will define you as rich. If you can afford a $50,000 car, you are rich. If you can afford a 2000+ sqft home, you are rich. If you can afford to buy a decaf latte grande every day, you are rich. *Most* americans live paycheck to paycheck and are vastly in debt. Slashdotters are not typical people. Moreover, most slashdotters don't even know anyone who isn't rich. They will live in a rich neighborhood, and work with rich people, and buy everything online, or from stores staffed by the children of rich people.

You are mistaking middle class for rich. And you apparently think poor people (who work at wal mart and other retail jobs) are middle class. I feel like you need to brush up on what actually defines the economic classes we use in America. Most lawyers and office professionals are middle class. The 1% big shot partner lawyers and leading trauma surgeons are rich.

Rich means not having to worry about money. Losing your job isn't a big deal. Rich means having investments that provide you with income regardless of what you do for "work".

Middle class means a two story house in a major suburb with 2.5 kids. That's not rich. If the people you are calling rich lose their job tomorrow then they would be scrambling to find a new one before their 3-6 months of buffer runs out (if they're lucky).

Poor means living paycheck to paycheck. You lose your job today and you could literally be homeless in a week.

Re:$250K is the definition of the evil 1%

[Cederic]

Well, there's also Central America, and Latin America. Or the Americas if you want to nuke the whole bunch.

Re: $250K is the definition of the evil 1%

[Cederic]

Hmm. Skip the marriage entirely, just sponsor a student every year. $1k/month renting her an apartment, $1k/month on gifts and entertainment, access whenever you want and no baggage.

Shit, even I could afford to do that if I wanted, and it's a hell of a lot cheaper than handing half your cash to a woman you hate.

Re:$250K is the definition of the evil 1%

[lars5]

Wrong, so wrong, so very, very wrong.

A person's income (if they work for someone else) is based ENTIRELY on how much the employer views their effort is worth.

THAT'S IT. It's not about "oh, poor Jonny works so hard at the mill and it's back-breaking labor," it's about how much someone else is willing to pay him to do it.

If my effort is valued as higher than another person's, why should I be punished (taxed) for that? People who feel this way (key word FEEL) are unable to distinguish effort from value.

Re:$250K is the definition of the evil 1%

[amiga3D]

Not really. 250K requires you to be frugal to have all that. It's a significant part of your budget, not pocket change. No super exotic car or any of all the other things plus, you have to work. Rich people don't have to work, their money works for them.

Re:$250K is the definition of the evil 1%

[chaotixx]

Warren's day-to-day lifestyle is actually less extravagant than many other people's in Omaha where he lives. He has a nice house (I drive by it on my commute), but it is no mansion. Not even the nicest house on the block. He drinks Coke, not lattes, and eats at old-school Italian steakhouses that are reasonably priced. He does travel much, much better than most though, since Berkshire Hathaway owns NetJets. He used to prefer to fly commercial, but I'm not sure if that is still the case.

Re: $250K is the definition of the evil 1%

[OhPlz]

If one person has to pay more than the other just because they earn more, then the tax isn't fair. We should all have an equal responsibility to fund our communities.

Re:$250K is the definition of the evil 1%

[Rakarra]

Did he work 5x longer or harder than the median Joe who only makes $51k? Or the guy working two full-time minimum wage jobs to make $32k?

Almost certainly not. He was in the right place at the right time, had the right connections, etc. Income in the US is based more on luck than effort or skill.

It's about how much value you bring, not the physical effort involved or the number of hours you work. Any idiot can be a ditch digger, which is why someone with a shovel doesn't earn much (or usually doesn't have a job anymore). Now someone talented at operating the heavy machinery that digs the ditches these days, that might be another matter.

Compensation is based on how hard you would be to replace. If your industry is full of folks willing to do the same job but cheaper, that will drive your salary down.

Re:$250K is the definition of the evil 1%

[h4ck7h3p14n37]

I have a hard time believing you have all of that with one person making $125,000 in Seattle. You must be carrying a lot of debt?

I'm in Chicago and make a bit more than you. New single-family construction on the south-side is going for $575,00; $250,000 gets you a fixer-upper. It would be a stretch for me to buy a single-family home, I'd be looking at a $130,000 down payment and then about $3000 in home owner expenses each month. I was happy to recently find a unique coach house behind an old mansion for sale for $379,000, but there's no real yard or views from the property.

Re:$250K is the definition of the evil 1%

[Magius_AR]

And the point of the two Americas meme is that in one of them, you don't get the most basic needs met, and in the other you do

I'm sorry, but I don't qualify "getting the most basic needs met" as "rich". Nor do I qualify "basic needs + some level of comfort" as rich either. Yes, I agree there's actual poor people who don't have enough money to survive and deserve to get a leg up. But similarly, people who get a degree in skilled labor and bust their ass working in a 9-to-5 high-salaried worker bee role to try to give their families more than a "subsistence" lifestyle don't deserve to be treated like they're driving around in limos and smoking cigars with the Rockefellers (which is what the "rich" connotation implies). And they don't deserve to be forced to live a subsistence lifestyle just because you believe they should be living in a closet and denied fancy coffee.

Re:$250K is the definition of the evil 1%

[painandgreed]

So, if that is your definition of "rich", what do you define Warren Buffet and Bill Gates as?

'Filthy rich', or perhaps 'obscenely rich'.

Re:$250K is the definition of the evil 1%

[Rob Y.]

I didn't say rich. I was talking about the Two Americas meme - and making the bottom line value judgement that once your basic needs (and future security) are taken care of, the rest of it is a form of excess. Not that that's bad - just that it's not 'necessary'. Feel free, if you must, to include those lattes in your bag of basic necessities. It doesn't change the basic formulation. I'm in no way talking about a subsistence lifestyle.

One of the two Americas (in my opinion) includes the rich and the upper middle class. And, if we had decent national health insurance so that the potential for medical Armageddon didn't hang over our heads, might well include the rest of the middle class...

Re:$250K is the definition of the evil 1%

[MyrddinBach]

It's 250k for an individual and 500k for a couple.

Re:$250K is the definition of the evil 1%

[losfromla]

Not sure why you were flagged troll, I thought it was a reasonable rejoinder. I guess the wealthy trolls got a lot of mod points today.

Re:$250K is the definition of the evil 1%

[losfromla]

How about some data to put these arguments into context?

Its less fashionable neighbor, Queens, outearns Brooklyn at $54,373 per year. New York City's most suburban borough, Staten Island, is also its richest, with a median household income of $70,295, while the suburban counties surrounding New York are all richer than any of the boroughs.Jan 9, 2014
https://www.google.com/url?sa=...

The ACS 1-year data shows the median family income for San Francisco was $103,237 in 2015. Compared to the median California family income, San Francisco median family income is $29,656 higher. As with the median household income data, 2016 family income data for San Francisco will be released in September of 2017.
http://www.deptofnumbers.com/i...

Based on those numbers, a "family" composed of 2 earners would be making 5x the median income for a familly in San Fran and 6x that in Staten Island. I'd say that definitely qualifies as rich. Now whether that affords one a "Lifestyles of the Rich and Famous" type of living, would be a different question. No doubt though that $250K is a lot even on the wealthy coasts. That housing costs are outrageous is a whole other issue.

Re:$250K is the definition of the evil 1%

[losfromla]

We're already there:

Bob Slydell: You see, what we're actually trying to do here is, we're trying to get a feel for how people spend their day at work... so, if you would, would you walk us through a typical day, for you?

Peter Gibbons: Yeah.

Bob Slydell: Great.

Peter Gibbons: Well, I generally come in at least fifteen minutes late, ah, I use the side door - that way Lumbergh can't see me, heh heh - and, uh, after that I just sorta space out for about an hour.

Bob Porter: Da-uh? Space out?

Peter Gibbons: Yeah, I just stare at my desk; but it looks like I'm working. I do that for probably another hour after lunch, too. I'd say in a given week I probably only do about fifteen minutes of real, actual, work.

Re:$250K is the definition of the evil 1%

[mysidia]

but that doesn't mean he didn't have significant advantages afforded to him based entirely on which womb he popped out of

Your parents' are also a predictor regarding whether you will have integrity and follow the straight and narrow path OR whether you will take up a life of crime. Perhaps we should then say it is unfair that we have prisons and criminal justice, because some people had bad parents, and thus say we need to either excuse all of these offenses, or impose a 2.5% tax on innocent people --- Every citizen will have to pay this tax as a 2.5% of their otherwise free days will have to be spent in prison, Because some people disadvantaged were destined by their parents to become prisoners at birth, therefore this "Is Unfair", And for some unknown reason, the Government has now decided one of its jobs is to fix all manner of Unfair things.

What womb you popped out of does not determine your future, because there are plenty of kids raised as adopted.

Peoples wealth can be largely affected by their parents' attitude and parenting abilities, And how their parents influence their development, however.

Maybe you should just say: We live in a meritocracy, BUT some people will not become wealthy no matter how hard they work, because they make mistakes and don't know how to recognize an admin mistakes, or didn't get the needed education, or didn't have the right drive, AND Parents can affect all these things for the better or for the worse.

Re: $250K is the definition of the evil 1%

[KGIII]

I am well within the wealthy category. I pretty much do all that stuff, and more, for myself. Well, no pool. I hate pools.

Re:$250K is the definition of the evil 1%

[david_thornley]

A person's income (if they work for someone else) is based ENTIRELY on how much the employer views their effort is worth.

Actually, no. That's a cap. The income is based primarily on the cost to replace that person or what that person does. Do you think a company is going to pay an employee more than they need to to retain his or her services or a replacement thereof?

Re:$250K is the definition of the evil 1%

[david_thornley]

Having lived with varying income, it's easier to get out of paycheck-to-paycheck on a higher income than a lower one. It feels to me like standard of living tends to be fixed to some extent, so by not increasing my living expenses as fast as my income I was in a better place. Given less income now, I'd try clinging to my present standard and not do so well.

Re:$250K is the definition of the evil 1%

[Immerman]

Close, but not quite - as another mentioned it doesn't matter how much value you provide, but how difficult/expensive you are to replace. As an example consider exactly how valuable is it to have working water, sewer, electric service, and other utilities. Then ask yourself, are the people actually on the ground maintaining those systems being paid more in line with the value they provide to society, or the ease with which they could be replaced?

And that is the heart of the discussion about the difference between the income you make (a market concept), and what you earn (an ethical/moral concept).

When those two concepts are deeply out of balance, as they are in the US, then it's appropriate for society to ask how, and to what degree, that imbalance should be corrected.

Re:$250K is the definition of the evil 1%

[bingoUV]

Is a 150 kg barbell heavy?

1. If yes, what would you define a super-massive black-hole some thousands of light-years away, as ? For some reason you just love forgetting an actual "heavy" exists, by calling many of the earth objects "heavy" and just lumping in the super-massive black-holes, as if those two classes are even remotely comparable.

2. If no, tell it to people and see them laugh at you.

Re:$250K is the definition of the evil 1%

[dcw3]

Agree w/parent & others that $250k is far from rich. Between my wife and I, we make about that much in the DC suburbs, and are comfortable. The avg. household income here is in the low $100ks, and a small home can run you north of $500...there are many at double that. While we're a dual income, one kid (I paid her college, and just married her off a few days ago), we still support our moms who only have social security as income...otherwise, I'd be looking to retire after 40 yrs of working so far. Everyone has different financial circumstances, and income is just one factor that shouldn't be the sole identifier of the "rich".

Re:$250K is the definition of the evil 1%

[lsatenstein]

Yeah, that was my first thought, when did $250K a year define you as rich?

In *every* part of the US, that will define you as rich. If you can afford a $50,000 car, you are rich. If you can afford a 2000+ sqft home, you are rich. If you can afford to buy a decaf latte grande every day, you are rich. *Most* americans live paycheck to paycheck and are vastly in debt. Slashdotters are not typical people. Moreover, most slashdotters don't even know anyone who isn't rich. They will live in a rich neighborhood, and work with rich people, and buy everything online, or from stores staffed by the children of rich people. On the rare occasion when they do go into a walmart, they look at the cashier with pitty thinking that these are the only poor people. They never see the 5,000 people who would kill just to get that walmart job. They never see the people working the warehouse jobs, or the folks living in the places where you joke about being unsafe to drive at night. They simply don't understand that their world is the exception not the rule.

The other side of that are the working class and poor. They know the rich exist, but they never see them, they never get to go into those neighborhoods. Their kids don't go to the same schools with the rich kids so they never have a reason to meet with the rich parents at PTA meetings (assuming they could even get enough time off work to go).

The simple truth is there are two Americas. There is the one you live in, and the one they live in. I sincerely hope you never have to live in their world because it is a pale shadow of the America you live in. In spite of that fact, their lifes work means you can get your stuff cheap online and in store. They buy the products that directly or indirectly fund your huge paychecks. In a very real sense, they are very nearly modern day slaves who's entire existences fuels your lifestyle.

The average American watching TV is looking at a lifestyle that is beyond their own. They can only aspire to have the kind of wealth they see on their nightly sitcoms and dramas, but they watch anyways always dreaming that they live those lives instead of their own.

I could give you a million places to look where you could peel back the veil of abject poverty and see the new slave class this country has embraced, but it is probably better that you continue to live the fantasy so that you can pursue the things that just might actually make a better tomorrow for everyone. If you had to face the demons that comes with your own wealth, it might destroy the fragile innocence that allows you to sleep at night.

Last year my last car cost me $750 (Honda Civic 2005). My cellphone was recycled, $30.00 for a Motorolla. It too is good for about 6 hours of youtube gazing.
My flat screen TV was end-of-clearance sale 1080p 55 inche for $450.00

I rarely want to be first with new technology. I did live on the "I must have that toy" world until I got smart. All my kids went to university and graduate school, and with no debts. -- Wonder why? No expensive toys.

Re:$250K is the definition of the evil 1%

[beastofburdon]

Almost certainly not. He was in the right place at the right time, had the right connections, etc. Income in the US is based more on luck than effort or skill.

Sadly this is true, but I would also add "what family you are born into" as the most significant factor. Though there is an argument that "had the right connections" would include this.

Re:$250K is the definition of the evil 1%

[dcw3]

You seem to make it very black and white, rich vs. poor, with no grey area. That's simply not the case. Your definition of rich is far south of anything used by the government, or the vast majority of people, but it may simply be relative to your spot in life. My mom and mother-in-law are, by my definition poor, both living on only Social Security, and what they can get from things like Meals on Wheels...everything else comes from my wife and I. If you live in a trailer park, nearly everyone else looks rich to you. It's not two Americas, there's a lot of space in between, but you clearly haven't experienced it.

Disclaimer:
I say this, as someone who grew up with a single mom, renting homes in Detroit...I know what poor is. I lived on PB&J and Tang for a while, so tell me about it. And, after 40+ years of working my way out, I've managed to make it to the level we're discussing, though it's in the high cost area of northern VA, where the avg. household income is well over $100k, and a 2000+ sqft home is hard to find.

Re:$250K is the definition of the evil 1%

[beastofburdon]

Your parents' are also a predictor regarding whether you will have integrity and follow the straight and narrow path OR whether you will take up a life of crime.

True, the less integrity and more criminal behavior of your parents the more you are likely to make. Unless you started out poor of course.

Re: $250K is the definition of the evil 1%

[kenh]

Social security is a SUPPLEMENT, only intended to provide for 40% of a persons needs. It's not intended to provide for 100% of your needs.

This is the same stupid argument people have about SNAP payments (formerly know as Food Stamps) - the very first letter in SNAP belies the intent of the program "Supplemental Nutritional Assistance Program."

Re: $250K is the definition of the evil 1%

[kenh]

This tax applies to INCOMES of $250K/500K depending on filing status, all this discussion of households earning slightly less than $250K are irrelevant, they would need to more than double their household income before they paid a penny of this new tax.

Most people earning that kind of money (mid six-figures) typically has the ability to shift compensation to avoid taxes, and many do.

Re:$250K is the definition of the evil 1%

[werepants]

$50k/yr will allow you to live a luxurious (but not conspicuously wasteful) lifestyle in most areas of the country. If you can put away enough money such that 4% of it will provide for your annual needs ($1.25M in this case) you never have to work a day in your life ever again, because on average you can safely withdraw that amount from invested funds and still be ok after accounting for growth and inflation. If you were making $250k/yr, you live off of $50k, save the rest towards your $1.25M, and retire within 10 years, easily.

The fact that many people choose not to do this doesn't mean they aren't rich - it means that they irrationally attempt to impress their friends with nonsense status symbols, instead of wisely investing their excessive incomes to buy freedom and self-sufficiency.

Re:$250K is the definition of the evil 1%

[dcw3]

Let me help you, because you seem to be putting everyone who makes that much in the same bucket, and leaving a few things out. Not everyone has the same circumstances. As a couple, my wife and I earn about that much. We have a $3700+ mortgage (upper middle class neighborhood), $800 car pymts..both 2012 Chrysler products that we got the employee discount on through family), about to be paid off, We max out our 401k deposits (6%, so roughly $15k). We support two mothers, both who live on only Social Security, to the toon of roughly $30-40k/year, and that will go up once we have to put them in homes. We paid roughly $140k to put our kid through college up through a couple years ago, an just married her off last weekend...~$25k for that. I'll end up spending over $9k in medical insurance, and probably another $10k in medical bills this year (I had a near fatal fall just a few months ago). Our state taxes will be about $15k, along with personal property tax of ~$2k. We typically donate to charities, $1-2k/yr. ~$1k for LTD & AD&D & Term Life. We splurged and spent double our normal vacation budget this year because YOLO, and we're not getting any younger...~$8k on a Nat Geo tour...we squirmed at the cost.

So, yeah, we're comfortable...as someone nearing retirement after 40+ years of work should be, but rich?...far from it. I know rich people...my uncle, my dad's best friend...both were multi-millionaires years ago. You can't really lump us in with people like that.

Re:$250K is the definition of the evil 1%

[Moridineas]

Hi dcw3,

Reply is late, but I just saw your message. My entire message did assume that the >$250k being targeted was indeed one of those techie types, filing singly. Married filing jointly (along with child deduction, tuition deductions, etc) would pay substantially less tax, but would obviously have more expenses.

I had thought about including retirement account in my ballpark above, but decided to leave it out. Probably should have included it.

Even for you--a two person household--your house mortgage numbers plus car payments are pretty much dead on my estimate for what could easily be afforded.

Where I do disagree with your assumption is that having all these things--an 800k house, two 30k+ cars, presumably 100k's+ in retirement accounts, ability to pay cash for 8k vacations, ~250k annually salary, ability to drop 25k on a wedding, ketc., does not put you in the rich category. Now please note, I'm not judging that at all--I'm in a similar boat (though I do live in a much, much, much lower cost area of the country. My ~3000 sq foot house in a nice neighborhood costs 250k). BUT, statistically speaking, that's rich. 3x or 4x the mean household salary nationwide is getting up there!

Also, going by the numbers, most people who would be described as "rich" don't have that much cash on hand. The "rich" tend to live more extravagantly than they should. Paradox of the the Millionaire Next Door. Like I said, we're not talking wealthy like NBA players (many of whom do go broke) or movie stars (many of whom do go broke), but compared to the vast majority of Americans? rich.

Sorry to hear about your health problems. Out of curiosity, did you have insurance through work or exchange?

I would also add, that even in Seattle, people can live in housing that is substantially cheaper than 800k. People can easily spend less than $100/day for food (even for a multi-person household). People can easily drive a 20k (or less) car that is perfectly fine.

Taxes and housing costs are by the far biggest variables in local costs. Have you considered selling that 800k+ house and moving to a lower cost state? Texas? Georgia? NC? etc? There's a reason so many people are moving south!

Re:$250K is the definition of the evil 1%

[dcw3]

To answer just a couple of your questions...

Yes, medical insurance took care of much of my costs. Total bills were nearly $60k, but didn't cover everything. We lost our "Cadillac plan" at the beginning of the year, just three months before my fall.

As for moving, I've been with the same company for 35 years, and my wife grew up here. Her divorced parents both live nearby. But yes, we will be moving once we retire (within the next 2-5 yrs), in order to downsize, and get to a lower cost area (we've been scouting for several years already), and away from the rat race that is northern VA.

Re:$250K is the definition of the evil 1%

[Moridineas]

My father in law's company just dropped their cadillac plans too. Really unfortunate, as he's had some chronic health issues develop over the last couple of years.

I used to live just outside of Falls Church. Nice area with a lot of options for food, culture, etc., but man, I just could not deal with the traffic. My commute was ~9 miles, and I could never know whether it was going to take 15 minutes or 1.5 hours. The record was 2.5 hours (an 18-wheeler truck carrying office supplies overturned coming onto the Beltway blocking all lanes. Paper, pallets, boxes, etc., were EVERYWHERE.)

This was around 10 years ago, and yy wife and I were making about 120k while living in a tiny one bedroom apartment (1200/mon). Kids were not yet in the picture. We were living fat then and stashed a lot into savings, but once we started looking at a house, daycare, private school tuition, even going down potentially to one salary, a lot of the "fun" things about the area then seemed out of reach.

Future proof

[lucm]

In 10 years, the Seattle City council will complain about the impact of commuters on its road infrastructure, with larger and larger numbers of tech workers living outside the city where they are not subjects to Seattle taxes

Re:Future proof

[superwiz]

No, it won't. It will complain about the impact of all unfinished construction projects and will to unsuccessfully sue corporations which abandoned them. The office space will be useless in Seattle because it will be impossible to hire anyone after they left for jobs on the Eastside or other parts of the country. Seattle has always been a ghost city. Even the Space Needle is usually empty. It has all the build out to welcome crowds of people minus the crowds. In the recent years, it's enjoyed a sprawl mostly due to growth of Amazon. But Amazon is so spread out around the country, that they can shift positions to different locations as their employees leave. That's one of the rules to running a company town -- don't chase out the company.

Re:Future proof

[Lumpy]

MOST large cities have an income tax.

I don't see rich people fleeing Chicago or NYC.

Re:Future proof

[Chris Mattern]

No, in ten years there won't be an income tax, because the courts will have struck it down. The Washington state constitution seems to be pretty clear on the matter. The city government will be noticeably poorer, however, what with not having the tax and being stuck with a bunch of legal fees.

Re:Future proof

[lucm]

MOST large cities have an income tax.

I don't see rich people fleeing Chicago or NYC.

What? Can you post a link to support that? Income tax is usually state, not municipal.

Re:Future proof

[superwiz]

I don't see rich people fleeing Chicago or NYC.

You must be joking. Why do you think drove the real estate boom in NJ? Companies leaving NY. NY has failing schools and hasn't been able to afford a new subway line in many, many years. Oh, and you should take a drive through Chicago if you ever look to get depressed. It's certainly the nastiest place in the country that I have ever been to. And I have been to many.

You also missed the whole point about company town. This is specifically a tax on Amazon developers. They the main block of new residents driving up all the prices. And once a large enough percentage of them go, Amazon will have no reason, heck no ability, to stay. If even 5% or 10% of Amazon employees will leave because of this, Seattle will turn into Detroit. It's population will not reduce significantly, but the financial commitments it has already made will not be met. Future planning always projects best-case scenario. And city planners overcommit based on the bast-case scenario. So when the worst case scenario comes about, its impact on the cities' budgets is multiples of its impact on cities' overall economy. And, of course, infrastructure and schools are effected first.

Re:Future proof

[JonStewart]

It's the fastest growing city in the nation for a few years running now, which doesn't exactly add up to "ghost city." I guess it's actually not "built out to welcome crowds of people" since it is singled out for world-class traffic congestion, and its housing/homelessness crisis. That's why they're levying an income tax on the super wealthy, as other cities have.

Re:Future proof

[guruevi]

In 10 years, all those 'homeless people' will have been replaced by gang members and Seattle will turn out like Chicago. We call what Seattle's calls homeless "hipsters".

Re:Future proof

[Balthisar]

I won't bother to look for NYC or Chicago, but Detroit has an income tax: http://www.michigan.gov/taxes/...

I think some of our great state's other shitty cities have them, too.

Re:Future proof

[schnell]

In 10 years, the Seattle City council will complain about the impact of commuters on its road infrastructure

More likely they will be complaining about why there isn't enough usage of the mandatory tandem bicycle ride-sharing service that they instituted when they turned all the city's North-South streets into seven-abroad bicycle lanes.

I proudly call Seattle my home. And its mayors and city councils really do believe they're doing the right thing, bless their hearts. But they are pretty much all blithering idiots. Because Seattle is a tech boom town filled with generally liberal people, they have the money and political backing to do well-meaning but impractical things.

You know, things like spending hundreds of thousands of dollars on a bike share program in a city that is full of huge f***ing hills and where it rains half the year. Or mandating a $15 minimum wage without studying it first and then seeing it decrease earnings of those it was designed to help, at least according to one recent study (more research over time is still needed to say for sure). There's a much longer list for someone crankier than me to make.

It's well meaning but it's almost universally poorly thought out in terms of unintended consequences. Like this income tax idea, which will perversely drive out the people who pay the most in property taxes and push them into driving into work from the suburbs. And Seattle already has miserable traffic. But, again, while the economic sun is shining the city has the leeway to try these grand but foolish experiments. Unfortunately, at some point the tech boom here will end and there will be a nasty bill to pay for it.

Re:Future proof

[superwiz]

Oh, it will be poorer for other reason, too. Because the insurance companies are extremely risk-averse. It will be much more difficult to get funding for new business or new construction while the litigation is going on. Insurance companies will not underwrite because there will always remain a chance of losing in courts (because the judges are beholden to politicians). And then the newly-built properties' values will drop into oblivion. All new development is done with overcommitted money. It's usually more than 10:1 or even 20:1 of borrowed money to existing capital. So if the values drop by even 5%, the properties will be underwater (lenders will start losing on principle).

Re:Future proof

[Rockoon]

That might explain what happened to Detroit.

Re:Future proof

[WhiplashII]

I can verify that Chicago does not have one. We would string them up...

Re:Future proof

[R3d M3rcury]

It's been years, but I believe NYC has an income tax.

Ages ago, I worked on payroll software in NYC. Of course, to test that I was doing things correctly, I used my own paycheck. I couldn't get it to balance out. Turned out my boss was taking NYC taxes out, even though I didn't actually live in NYC (I lived out on Long Island and took the train in). She calculated everything out for my co-worker, who lived in the city, and then just used the same numbers for me (since we were paid the same).

He was a little annoyed when I got a "raise" and he didn't...

Re:Future proof

[superwiz]

NY has a few good public high schools which are very competitive to get in. The rest are failing. NY elites most certainly do not go to public schools in the city. They go to private schools.

Re:Future proof

[superwiz]

You guess, and I am telling you about how the city actually feels when walk down its streets. Imagine all the built-out at the level of modern Tribeca, but with day-time crowds at the level of Manhattan at 5am on Tuesday. This is every-day Seattle.

Re:Future proof

[amiga3D]

They don't, and for one simple reason. To avoid the tax all you have to do is move outside the city. Which is of course what happens. Only an idiot would allow themselves to be extorted if they could avoid it. I knew a lot of senior NCOs when I was in the Air Force that retired to states with no state income tax for that very reason.

Re:Future proof

[amiga3D]

https://www.priortax.com/filin... A list of cities to avoid.

Re: Future proof

[superwiz]

For who? SDE? If you are a principle and making less than 200k, there is more than 2 people dipping into your salary (agents, agents' managers, etc.).

Re:Future proof

[Anonymous Coward]

You know this tax is going to spread if this not shot down by the State Supreme Court. 100k will be the new rich making it deep. Then the other areas like Everett, Kent, Federal Way, Burien will see that pot of money making it wide.

King County might have ideas too, ST3 sure hit the pocketbooks eh.

Re:Future proof

[PrimaryConsult]

NYC absolutely has an income tax. To partially avoid the whole "people will leave the city!" adjacent Yonkers also has a city income tax.

That said, Nassau and the non-Yonkers parts of Westchester county are great for commuters. In addition to avoiding the city tax, the same unlimited Metrocard that works for the subways also works out there, so bus-commuter rail-subway trips are significantly cheaper than they would be anywhere else outside the city.

Re:Future proof

[PrimaryConsult]

The NYC private schools aren't that expensive, though. Many are subsidized by the Catholic church and offer scholarships. The best motivation I got to study hard was when my mom warned me "We have no money. If you don't get a scholarship into a private school, you're going to have to go to {local public school} where the crack dealers recruit from". Studied my ass off and got 2 out of 3 scholarships. Our three person household lived in NYC on 15k/yr in the late 90's, failure was literally not an option.

Re:Future proof

[PrimaryConsult]

It will be worse. They will have been collecting the income tax for 10 years and will need to pay it back. The administrative overhead of tracking down everyone they collected it from and cutting them checks will be more than they ever got in the first place.

Re:Future proof

[TooManyNames]

I don't see rich people fleeing Chicago

The average annual income of taxpayers leaving Illinois was $77,000 while the average income of people entering Illinois was $57,000 in 2014; the vast majority of the outflow hailing from the Chicagoland area. So yeah, it's pretty much exactly "rich" people fleeing Chicago.

Re:Future proof

[TooManyNames]

I've been to Seattle several times -- in the past couple years -- and my experience is far more in line with the GP's than yours. I've never seen it anywhere close to empty and, while I've seen worse traffic congestion, to imply that there's little traffic (both auto and foot) is a flat-out lie.

When's the last time you were actually there? Or were you perhaps comparing it unreasonably against ultra-crowded cities?

Re:Future proof

[XopherMV]

Or mandating a $15 minimum wage without studying it first and then seeing it decrease earnings of those it was designed to help, at least according to one recent study (more research over time is still needed to say for sure). There's a much longer list for someone crankier than me to make.

It's well meaning but it's almost universally poorly thought out in terms of unintended consequences.

Bullshit. I was part of the effort to raise the minimum wage in Seattle to $15. The effort was studied and argued ad nauseam. We looked at all the data. Study after study shows that paying people a living wage is not only feasible, but improves the economy. It may be shocking to learn, but putting money into the hands of people who'll actually spend it in the community boosts the economy. Your spending is my income, my spending is your income. You get paid more, then you spend more. Then I make more and pay you back. That's how economies work.

(What hurts an economy? A few rich assholes sucking up all the money for themselves and then sending that money out of the economy to their Swiss bank accounts.)

This recent study came out contradicting previous results. It stated that increasing the minimum wage hurts workers. Turns out the new study wasn't peer reviewed. Another shocker. One problem of many is that the new study excluded minimum wage employers with multiple locations. Why? No good reason. If a restaurant was successful and opened a second location, it wasn't included in the study. No surprise that increasing the minimum wage looks bad if you methodically cut out the successful businesses.

http://www.epi.org/publication...

Like this income tax idea, which will perversely drive out the people who pay the most in property taxes and push them into driving into work from the suburbs. And Seattle already has miserable traffic.

Everyone wants to live close to downtown. Part of that is precisely because of the miserable traffic. We've got the hottest housing market in the nation. If a few people leave over the income tax, there's 10 times the number of people who'd love to buy their homes, move in, and pay that income tax. Our housing market will be completely fine with this tax change.

But, again, while the economic sun is shining the city has the leeway to try these grand but foolish experiments. Unfortunately, at some point the tech boom here will end and there will be a nasty bill to pay for it.

Yeah, sure. The internet is just a fad. It'll end soon. Keep telling yourself that.

Re:Future proof

[superwiz]

When's the last time you were actually there?

About a month ago. You've seen foot traffic somewhere other than the Pike market? From my experience even the Space Needle is always empty... with the possible exception of Christmas.

Or were you perhaps comparing it unreasonably against ultra-crowded cities?

I am comparing it to Manhattan because that's the rate of sprawl it's been experiencing... close to that of Manhattan in the 90s. The foot traffic puts it on the level of Cleveland or so.

Re:Future proof

[Maxo-Texas]

This took me 2.5 seconds to google and I don't even give a crap about the issue.

Could people stop being so damn lazy when the information is easy to verify?

https://www.google.com/search?...

New York Taxable Income Rate
$25,000 - $50,000 3.591%
$50,000 - $500,000 3.648%
$500,000+ 3.876%

https://www.thebalance.com/cit...

Alabama: Birmingham levies an income tax of 1%
Arkansas: Seven Arkansas school districts assess an income tax surcharge equal to 10% of state income tax before tax credits. They are Berryville, Green Forest, Westside, Hope, Huntsville, Waldron, and Marshall.
Colorado: Three cities impose flat taxes on compensation. Aurora charges $2 per month on compensation over $250, Denver charges $5.75 per month on compensation over $500, and Greenwood Village charges $4 per month on compensation over $250.
District of Columbia: D.C. has a bracketed income tax system. The rates are 4% for the first $10,000 of income, 6% for $10,000 to $40,000 of income, and 8.5% for income over $40,000.
Delaware: Wilmington has a flat 1.25% tax on income.
Iowa: 666 school districts impose an income tax surcharge ranging from 1% to 20% of state income tax owed.
Indiana: All 92 counties in Indiana have an individual income tax. Tax rates are in the process of being changed and will be announced on the Indiana Department of Revenueâ(TM)s website once they are finalized.

Kentucky: Eight cities in Kentucky levy income taxes on residents and non-residents. They are: Bowling Green (1.85%), Covington (2.5%), Florence (2%), Lexington-Fayette (2.25%), Louisville (2.20% for residents and 1.45% for non-residents), Owensboro (1.33%), Paducah (2%), and Richmond (2%). Lexington-Fayette Urban County Government and Louisville - Jefferson County also impose taxes on businesses.

Maryland: All 24 Maryland counties levy income taxes on residents and non-residents. Tax rates range from 1.25% to 3.20%. Baltimore also has an income tax of 3.05%.
Michigan: Several Michigan cities impose income taxes with rates ranging from 0.50% to 2.50%. Detroitâ(TM)s income tax rate is 2.50% for residents and 1.25% for non-residents.
Missouri: Both Kansas City and St. Louis have an income tax of 1%.
New York: Yonkers and New York City both have individual income taxes. New York City's income tax rates range from 2.907% to 3.648%. Yonker's income tax rate is equal to 10% of your net (after credits) state income tax.
Ohio: 235 cities and 331 villages in Ohio have an income tax, including Columbus, Toledo, Cincinnati, and Cleveland. Ohio law requires a flat rate that cannot exceed 1% unless it is approved by the voters. Ohio local income tax rates range from 0.40% in Indian Hill to 3% in Parma Heights.
Oregon: The Tri-Met Transit District (includes Portland) assesses an income tax of 0.6318% and the Lane County Transit District (includes Eugene) assesses an income tax of 0.60%. Multnomah County (Portland) also assesses a 1.45% business income tax.
Pennsylvania: Most municipalities in Pennsylvania assess a tax on wages, known as the Earned Income Tax. This tax is usually split between the municipality and the local school district. The local Earned Income Tax is only assessed on earned income, like wages. Unearned income like interest and dividends are not taxed. Pennsylvania state law limits the Earned Income Tax to a maximum flat rate

Re:Future proof

[Rockoon]

So the only verified citation he gave is from a city that destroyed itself by attacking the upper incomes with taxes?

Hilarious. Fucking dumb lefties.

Re:Future proof

[FooAtWFU]

No, the Yonkers thing is the aftermath of the city's complete and total bankruptcy in the 1980s. It's not designed as a meaningful incentive.

Re:Future proof

[squiggleslash]

Yeah, I'm sure a whole 2.5% in taxes for people with huge amounts of disposable income (with the first 250k untaxed) will mean they'll be moving out into the suburbs.

Just a example, but property prices, whether rented or bought, are typically 1.5-5x the cost in a decent city compared to the suburbs. If a less-than 2.5% drop in income is going to significantly affect someone's willingness to live in a city, they're probably already not living in one.

People live in cities because they want what cities provide that suburbs don't. They're generally willing to pay for that. Oddly enough, suburbanites historically aren't willing to pay for the benefits of living in a suburb, which means the latter have always been heavily subsidized, but that's another story...

Re:Future proof

[lucm]

This took me 2.5 seconds to google and I don't even give a crap about the issue.

Could people stop being so damn lazy when the information is easy to verify?

I don't see Chicago in your list, yet it was one of the two examples given. If you want to be a non-lazy person, good for you, but at least do it right.

Re:Future proof

[lucm]

a whole 2.5% in taxes for people with huge amounts of disposable income

That's 2.5% on the income *before* other leeches have taken their cut. It's not 2.5% of the disposable income. It's a lot of money for no added value.

Re:Future proof

[Talderas]

I wouldn't be surprised to find that there are many states which prohibit city income taxes but that doesn't mean an effective city income tax cannot occur. It's only in states like Washington which prohibit income taxes entirely or reserve taxing income for the state where a city income tax cannot occur. There's plenty of cities which are entirely bound within counties which generally results with the lionshare of the county's population residing within the city. This can end up with a few outcomes including a special county taxing district that only covered the city limits or the poor sods not in the city that reside in the county having to pony up more cash to pay for the city they don't live in. In either case, while the tax is applied at the county level, it is basically a tax or tax increase that only exists because of the city and therefore makes it effectively a municipal income tax.

While there are some larger metropolitan areas which exist within multiple counties (Atlanta, Columbus, New York).there's plenty more which do not (Detroit, Seattle, any metropolitan area in California). It would be interesting to find out how city income tax permission coincides with multi-county status for cities but of course we would need to determine how much of a controlling share the city generally has over the county board which determines county taxes.

Re:Future proof

[Talderas]

Those are just the cities that do it themselves and the advice to move to a state that prohibits city income taxes is unhelpful unless the state also prohibits county income taxes. Cities do draw income from county taxes. Since cities tend to have a majority of the population in a county they frequently have control of the county board that deals with taxes. I'm aware of one city income tax that is being proposed right now that is being levied as a county income tax. My guess is that the encouragement for a city income tax is going to depend on how many counties the municipality exists in and whether there are some counties where it hasn't managed to successfully gain control of the taxing board therefore the city level income tax is a much simpler method to increase taxation.

Re:Future proof

[drinkypoo]

Like this income tax idea, which will perversely drive out the people who pay the most in property taxes and push them into driving into work from the suburbs. And Seattle already has miserable traffic.

All the better for the coming fleets of self-driving minivans, which are a certainty at this point. I agree with you about the bike program but not the income tax. Sure, some people will leave. They will be replaced just as rapidly.

Re:Future proof

[Anonymous Coward]

Insightful? Really? I guess you children don't learn civics or history anymore. There are dozens of books written about the causes of Detroit's decline. Put simply, Detroit is the poster child for "white flight."

Re:Future proof

[mr.mctibbs]

I live and work in NYC and I can confirm we do, in fact, have an income tax.

Re:Future proof

[mr.mctibbs]

And, just for good measure, it's fifty percent higher than the one that Seattle's proposing.

Re:Future proof

[bluefoxlucid]

It may be shocking to learn, but putting money into the hands of people who'll actually spend it in the community boosts the economy. Your spending is my income, my spending is your income. You get paid more, then you spend more.

Wages come from consumers. You're pulling largely from the middle-class consumer base, and preventing them from spending elsewhere; effectively, you're taking money out of middle-income-earner hands and moving it into low-income-earner hands.

This is only a net-gain if you have a lot more spending on those goods from tourism than from local consumers.

(What hurts an economy? A few rich assholes sucking up all the money for themselves and then sending that money out of the economy to their Swiss bank accounts.)

What percentage of McDonalds food purchases are made by top 10% income earners?

Re:Future proof

[bezpredel6]

Secular private schools in NYC run around $40K/year, not counting after school programs or transportation. And at that price, they fill up like a year before school starts (at least elementary ones seem to).

Re:Future proof

[MSG]

You visited Seattle Congratulations. I live here. The city you're describing is nothing like Seattle.

Re:Future proof

[Anonymous Coward]

https://taxfoundation.org/local-income-taxes-city-and-county-level-income-and-wage-taxes-continue-wane

Most U.S. cities and counties do not impose a local income tax, but they are imposed by 4,943 jurisdictions in 17 states, encompassing over 23 million Americans.

I assume an apology is in the mail.

Re:Future proof

[superwiz]

You visited Seattle Congratulations.

Thanks. I spend (as in present tense -- not past tense) quite a bit of time there. Lovely place. Real Estate prices are too much for me. I live on the Eastside. And yeah, I haven't had a reason to visit for about a month now.

I live here. The city you're describing is nothing like Seattle.

May I suggest that you are not exactly objective and just a tad bit defensive?

Re:Future proof

[superwiz]

The Space Needle is tourist trap.

Yeah, without the tourists.

If you're going to pretend to have some local knowledge, at least name drop neighborhoods where people actually live and work.

Seriously?

Re:Future proof

[sysrammer]

I like what Mr. Rogers had to say about it:

  "The money was all appropriated for the top in the hopes that it would trickle down to the needy. Mr. Hoover didn’t know that money trickled up. Give it to the people at the bottom and the people at the top will have it before night, anyhow. But it will at least have passed through the poor fellow’s hands.”
-Will Rogers in the St. Petersburg Times - Nov 26, 1932

Re: Future proof

[sysrammer]

If you think his posting or TFA is about price controls, you should move to the remedial class.

Re:Future proof

[PrimaryConsult]

That is because you are looking at secular. About 25% of the students at the catholic schools I went to were not Catholic. They basically got a gym period while we were in church. They still had to go to religion class but it wasn't indoctrination (no school that could be called "good" would do that, and they all want to be called good). Grade school was $400/month, I walked, "after school" was hang out with friends or walk home, use my key and watch TV until someone got home. Later on I was allowed to wander down to the public library and read. High school gave us a free 3 rides+3 transfers/weekday Metrocard. A lot of these expenses people put themselves through are because they apply suburban rules to city living - city kids simply do not need to be watched all day.

Re:Future proof

[Anubis IV]

Chicago doesn't have one. That's why he didn't list it.

Re:Future proof

[Ichijo]

If Chicago turns $57,000 workers into $77,000 workers, then does it also turn $77,000 workers into $97,000 workers?

Re:Future proof

[Scroatzilla]

This. It's tremendously short-sighted to just raise the minimum wage. It inevitably makes jobs disappear. So there will be a few people for a short period of time who have more cash in hand, but-- assuming that their jobs are low-skilled and not meant to provide a *career*-- they'll soon be out of work, thus sucking money *out* of the economy, rather than *into* the economy.

The whole "fight for 15" is such a silly "feel good" issue for liberal elitists; and, like other economic issues, the elitists will ignore real-world results and make abstract excuses for any signs of failure.

Re:Future proof

[bongey]

NYC has some of the most complex tax returns you can imagine for a city.

Re:Future proof

[bongey]

Seattle isn't the fastest growing city by population, it is only if you compare population density large cities http://q13fox.com/2017/05/25/u... .

Re:Future proof

[david_thornley]

Raising the minimum wage can be a bad idea, or it can be a good idea. Typically, a minimum-wage worker is minimum-wage because there's a fairly small cost to replacing him or her, and typically the minimum-wage worker provides enough value to justify a raise.

Suppose I'm an employer, and I hire someone for a minimum-wage job. I pay that worker minimum because I can get someone who'll do the job for minimum wage. If I make $30/hour because the employee is there, I'm not going to pay better than minimum wage, because I don't have to . If, suddenly, the minimum wage goes to $15, I still make money on the employee, so the employee winds up making more money. Further, the employee is likely to spend more money in the community that I was, stimulating the economy and providing more jobs.

Real-world results tend to be favorable for the sort of minimum wage we're talking about.

Re:Future proof

[Maxo-Texas]

And what would you conclude from that?

Chicago doesn't have a tax.

I didn't have a position on whether it had a tax or not. I just took a couple seconds to look it up before posting "cite please".

Re:Future proof

[Jack9]

> That might explain what happened to Detroit.

But it doesn't, because it didn't contribute meaningfully. This is a case of revisionist FUD modded as insightful.

Re:Future proof

[cthulhu11]

I've never known the Space Needle to not have a healthy visitor stream.

The summary above is misleading in that it implies that Amazon and other tech employees would be taxed even if $250k.

By any measure King County is rife with rich people. Years ago I heard a list of the top counties in the country by millionaire population. King was fourth, with 68,000. That was before Amazon got huge, so it's no doubt more now. Microsoft's compensation and personnel policies had already created a haves vs have-nots scenario twenty years ago, and it's only getting worse. As in, Seattle really has become San Francisco.

Amazon will not be harmed by this tax if it goes through. They are rife with cash. The rich will still be rich, their rank & file will still be slaves who are accustomed to being abused. Nobody will go anywhere, Amazon is staunchly Facebook-like in their insistence on employee locality. Even 15-20 years ago they turned me away because I didn't live downtown, within 5 minutes of their DC.

Re:Future proof

[geowash01]

Here you go: "Illinois’ out-migration rate per 1,000 residents is the worst in the region by several multiples." Maybe you can "see" the data even if you can quite make out all the moving vans. https://www.illinoispolicy.org...

Re:Future proof

[im_thatoneguy]

Maybe in downtown commercial districts. But that's true of every major city where the office buildings empty and nobody remains. South Lake Union and Cap Hill are active 24/7.

Re:Future proof

[im_thatoneguy]

I am comparing it to Manhattan because that's the rate of sprawl [Seattle has] been experiencing

LOL Wut!? Ok, sure, compared to Manhattan Seattle is a "ghost town". But so is every other city in North America. You're expecting foot traffic in Seattle to be similar to Manhattan because "it's the same rate of sprawl". That's the dumbest fucking metric I've ever heard. So a small town of 50 people which quadruples to 200 people should see Manhattan foot traffic rates because their rate-of-sprawl metric is similar?

There is one statistic that affects foot traffic, it's called density. Manhattan has a population density of 70,517/sq mile. Belltown is the *most dense* Seattle neighborhood and it has 13,516/sq mile. Seattle as a whole is around 7,000/sq mile or 1/10th of Manhattan's density.

Re:Future proof

[dcw3]

I grew up in Detroit. The rich don't live in the city, they live in suburbs like one of the Grosse Pointes, Bloomfield Hills & Rochester. Detroit has been run into the ground, and is not a good example of what you're looking to find.

Re: Future proof

[dcw3]

Can you name one that does so with other than city employees?

Re:Future proof

[dcw3]

I'm honestly happy Seattle is running this experiment so that we can have some actual data to base future decisions on instead of whining opinions from one side or another. All that said, it appears you guys didn't do such a good job studying...

https://fivethirtyeight.com/fe...

Re:Future proof

[dcw3]

Also, searching for the "hottest housing markets", Seattle isn't close to the top in any of the searches I looked at...

http://www.marketwatch.com/sto...

http://webcache.googleusercont...

You made I to #15 here...
https://www.nationalmortgagene...

Is this additional income tax?

[Gabest]

I mean where I live you are happy to get 50% of your income after tax.

Re:Is this additional income tax?

[superwiz]

Washington state doesn't have an income tax. But it has 10% retail sales tax and 2% tax on all real estate sales (not on the profit -- on the full amount of the sale).

Re:Is this additional income tax?

[anegg]

The state of Washington doesn't have a state income tax, but gets the money it needs for operating from a myriad of other fees, sales tax, etc.

Re:Is this additional income tax?

[anegg]

The "liter" tax on liquor is obscene; not so much a sin tax as a "sure, we'll privatize booze sales as long as we get to keep collecting an amount equivalent to the profit we were making" tax so its a 20.5% tax in addition to the regular sales tax. Can't speak to cigarettes; I don't smoke. Don't know about a special tax on chips and salsa or a tax on fast food other than the "prepared foods tax" that is similar to other state's restaurant taxes but is 10%. Groceries (including candy and soda) are not taxed. But - the state sales tax is pretty stiff at 6.5%, and most local governments (county, and city) throw in their own sales tax, so you might see a sales tax of 8.5% to as much as 10% in some places. You can pay a whole lot for gas, or you can pay a lot, but it's not as bad as California! Buying gas at CostCo helps.

It is a trade-off... no state income tax, but a stiff sales tax, stiff real estate taxes, and lots of little fees. I moved here from another state, and I did so because I wanted to, so I guess from my point of view there are worse US states to live in.

Re:Is this additional income tax?

[Enigma2175]

Maybe a state versus federal thing? I don't know, from a non US standpoint 2.25% income tax on $250k seems almost comically small, so intuitively I'd guess it's in addition to existing income tax(es). Heck I get less than half that and I'm paying over 30%.

If you make $250,000 you fall into the 33% bracket (between $191,650 and $416,700), so you nominally one would pay $65,899.25 or 26.4%. Of course that is before any deductions and is different if you are married, but overall someone making $250k will generally pay 20-25% in federal income taxes (plus 6.2% for Social Security and 1.45% for Medicare) .

Re:Is this additional income tax?

[markdavis]

>"I mean where I live you are happy to get 50% of your income after tax."

In reality, it is probably far, far less than that but in a way most people don't think about. Most people still believe the only taxes they pay of any real meaning are income taxes, sale taxes, and perhaps gasoline and property taxes (forgetting sin taxes, communications taxes, tickets, taxes hidden in water and sewer bills, entertainment taxes, "death" taxes, hundreds of different licensing fees which are all taxes, tolls, waste disposal taxes on repair bills, etc). But the huge hidden tax burden is what happens with taxes we don't see that are passed through to us as reduced wages and higher prices of goods and services. Corporate taxes, payroll taxes, operational fees, and materials taxes are not only paid by YOUR employer, but everything you buy is taxed over an over and over and over again through the entire chain of production. The ore mine, the refinery, the company that built the refinery equipment, the logistics company, the company that built the trucks and computers for the logistics company, the parts stamper, the distribution chain, the assembler, the retailer, etc. There can be hundreds and hundreds of companies all involved in just about every single one product and service in a complicated web.

My wild-ass-guess is that everything we buy costs at least double due to taxes all along the way that accumulate. Couple all that with all the taxes we directly see, and your earning-power-to-purchasing-power probably represents something like you get to keep/use 20% or less of what you could have earned.

Re:Is this additional income tax?

[AmiMoJo]

The percentage of tax you pay is not all that relevant... What matters is what you get in exchange. If you paid 80% tax but had no bills at all (energy, water, telecomms, good food, lavish housing etc. provided for you) then you probably wouldn't mind too much. Similarly, if tax was 5% but you got nothing, had to pave the road to your house yourself, had to pay the cops to protect you, dispose of your own rubbish and stop people disposing of theirs on your property etc. you probably wouldn't be too happy.

Of course some people would love either of these scenarios, but most people want something in the middle and so the important question to ask is if the balance of benefits vs. tax paid is acceptable, adjusting for income.

Re:Is this additional income tax?

[JesseMcDonald]

The percentage of tax you pay is not all that relevant... What matters is what you get in exchange.

The system is involuntary, so what what you get is irrelevant. Someone else decides that, not you, which means it's all to their benefit, not yours. Perhaps you would have chosen to pay for those things, perhaps not. Either way, those in power cannot take any credit for providing goods and services of their own choosing, payed for with stolen funds. If you would have chosen to purchase those same goods and services freely then forcing you to do so adds no value; if not, they have only made you worse off by making you pay for something you didn't want, or couldn't afford.

Re:Is this additional income tax?

[AmiMoJo]

The system is involuntary, so what what you get is irrelevant.

If there was some way for you to avoid using any tax funded services you could opt out of paying it, but unless you want to move to the libertarian paradise of Somalia I can't really see how that is going to happen. You would be stealing from the rest of us.

You can't opt out of society, any more than you can opt out of breathing the same air as the rest of us. It's just not physically possible.

Re:Is this additional income tax?

[mjwx]

Maybe a state versus federal thing? I don't know, from a non US standpoint 2.25% income tax on $250k seems almost comically small, so intuitively I'd guess it's in addition to existing income tax(es). Heck I get less than half that and I'm paying over 30%.

If you make $250,000

If your taxable income is at 250,000, you are more likely making 350,000.

Re:Is this additional income tax?

[Enigma2175]

That's why my comment said "Of course that is before deductions".

Re:Is this additional income tax?

[david_thornley]

You don't seem to get how prices are set. Prices are set to get the optimum income. If a business could get more profit by raising taxes, it would already have done so. They aren't charities.

Taxes on corporate income don't affect the sales prices, since the price to optimize profit also optimizes .60*profit (or whatever). Similarly, taxes that represent fixed costs don't affect the optimal price.

Owners (including stockholders) absorb all of those taxes.

Re:Is this additional income tax?

[markdavis]

>"Taxes on corporate income don't affect the sales prices[...]Owners (including stockholders) absorb all of those taxes."

Nonsense! Taxes are an operational expense, just like any other- electricity, water, rent, paying employees, raw goods (which are all taxed already too), paying for auditors, advertisements, etc. Expenses (of which taxes are one) absolutely determine how much something costs to produce (either goods or services). In the long term, prices MUST be set higher than expense, or there is either no profit, or there is unsustainable loss. Market pressure and competition will force prices to be a low as reasonable for most markets, but how low they go is a function of how cheaply they can be produces, which is the cost (of which taxes are one).

Re:Is this additional income tax?

[david_thornley]

There are different types of costs.

Costs that have to be paid no matter what do not affect the optimum price. They determine how profitable (or not) the business is. If they don't cause businesses to drop out (thereby changing the supply curve) there is no effect on optimum price. Aside from that, the price that optimizes P also optimizes P - N.

Costs that are a fixed percentage of profit do not affect the optimum price. The price that optimizes P also optimizes 0.6P. These costs can't make a business unprofitable.

Costs that scale with number of units sold do affect optimum price.

Re:Is this additional income tax?

[im_thatoneguy]

My wild-ass-guess is that everything we buy costs at least double due to taxes all along the way that accumulate.

That would be true with a straight revenue tax but almost nobody does that. Let's say you charge a 20% tax rate. That's not 20% of the ore that's 20% of profit on the ore. So if your margin is 5% on mineral extraction your effective tax on the ore is actually 1%. Add up say 20 steps and that's only 20% not 50%. That's where your logic fails. The next place to do a quick sniff test on your assumption is total taxes / GDP. Thankfully someone has already done that.

http://www.justfacts.com/image...

It's around 25% of GDP. So about 33% of the price of goods and services is tax. But that's the maximum not the minimum. A lot states like mine charge a 10% sales tax. So you can't double count that tax. It would be 15% of GDP or about 17% more expensive.

Washington Policy Center

[MountainLogic]

Worth noting that according to Source Watch, the Washington Policy Center receives funding from the Koch brothers and pushes agenda items from American Legislative Exchange Council (ALEC) in the state.. Take that as you will per your political leanings.

Re:Washington Policy Center

[argStyopa]

Just because they say it, doesn't mean they're wrong. That said, I see no mention of the word income in the whole WA state constitution.

Re:Washington Policy Center

[CaptQuark]

Wow! Did you not even bother to read the original article? It contained a link to the exact section in the WA constitution the states it.

RCW 36.65.030

RCW 36.65.030
Tax on net income prohibited.
A county, city, or city-county shall not levy a tax on net income.

Searching the Revised Code of Washington for the single word "income" results in 2,266 hits.

Search Results: Total 2,266 >Query: 'income'

Please penalize yourself 10 Karma points for sloppy research.

---

Re:Washington Policy Center

[coinreturn]

But can they get around that with a tax on GROSS income?

Re:Washington Policy Center

[bongey]

Red Herring much? Just because the Koch brothers funded some group suddenly makes the information false.

Re:Washington Policy Center

[MountainLogic]

Bongey, Fair enough, but information about the source does provide context for their point of view and point to where a critical mind might look for faults and omissions in their argument. The fact is that the Washington supreme court last spoke on an income tax during the great depression. That was a tied decision due to an incapacitated judge. When a new member was dubiously appointed, the court overruled the personal tax 5 to 4, but changed their mind the next day on a similar business income tax (B&O) and in the supporting opinion on the B&O tax noted that the court had changed their mind from the previous day. Seems like they were just begging to have the topic revisited. There is a second question of law regarding the rights of cities to impose an income tax. For those looking to dig deeper, our local Seattle NPR station, KUOW, did a great in depth story in this today.

I notice the American Right wing

[rsilvergun]

is all in favor of local government right up until they do something they don't like. Then they want the State gov't to step in and outlaw it. The State gov'ts seem about perfect. Big enough to oppress but not so big they can't just buy them all out.

Re:I notice the American Right wing

[MBGMorden]

They're in favor of SMALL (ie, less) government moreso than local government.

In general most conservatives have no issue with a higher level of government saying to a lower level "No, you can't do that".

You know how when Linux geeks say "I just want the OS to be unobtrusive and stay out of the way so I can work."? Apply the same logic to government.

Re:I notice the American Right wing

[El Cubano]

I notice the American Right wing is all in favor of local government right up until they do something they don't like. Then they want the State gov't to step in and outlaw it. The State gov'ts seem about perfect. Big enough to oppress but not so big they can't just buy them all out.

I think that Seattle gets it wrong, but I support the ability of a local or state government to make this determination for themselves. In fact, I think that the federal income tax should be abolished entirely and that states should be funding the federal governments out of their tax revenues. Of course, this would mean that states would have to tax income more at levels like what the federal government does. In fact, if you study the federal republic concept that forms the basis of the US, that is how it should be. The federal government today is far larger, more bureaucratic, and more powerful than the founders could have imagined.

Right now, if the federal government lowers or raises income taxes, then your only choice is to comply or run afoul of the law. In the state-based arrangement I mentioned above, the federal government would have to convince the states that it is in their best interests to fund whatever thing the federal government is proposing. That would act as a very effective check on the ever increasing power and size of the federal government. On top of that, if states choose not to comply it effectively acts as a form of pocket veto (because you cannot through an entire state in jail). Same as when some countries refuse to pay their UN dues, or whatever. If a large enough amount of money gets withheld then the job can't get done. It would make sure only truly worthwhile things get funded.

But then, I also favor a return to state legislatures selecting Senators. I don not think it likely that either popular election of Senators or the federal income tax will be repealed. But I still think they are good ideas.

Note: I don'y really know why I am replying here, as it seems anytime I pop up in anything even remotely political my posts get hit with an avalanche of "overrated" mods; it seems moderators believe "overrated" == "disagree". At least some of them have the intestinal fortitude to mod troll (even if I am not trolling), but then they probably are secure in their thoughts and ideas and can handle their mods being metamoded. So, I'll probably get modded to oblivion, but oh well.

Re:I notice the American Right wing

[Anonymous Coward]

Actually, I think you are mistaken. The right wing (and many independents) are fine with state and city governments implementing taxes like this instead of at the federal level. The key words are "instead of". The states and cities should be the test beds for what works and what doesn't. That being said, those on the right and independents who live and work in Seattle still have every right to petition their local government because they don't like this new tax.

It isn't like anyone on the right is saying: "The city can't do this, this should be left up to the federal government."

They are also complaining because the summary implies that it goes against the state constitution. I don't know that to be fact, but based on the summary, that is the assertion.

Being someone who leans right. I am fine with Seattle doing this if it is constitutional within their state. If it works, great for them. If it doesn't, I hope they learn from their mistake.

Re:I notice the American Right wing

[Uberbah]

They're in favor of SMALL (ie, less) government

They're also a fan of local control - until they're not. Almost like they are hacks that use arguments right up until they can be used against them, at which point they are promptly discarded.

Re:I notice the American Right wing

[Rockoon]

First and foremost they are in favor of Rule of Law.

Unconstitutional things remain unconstitutional regardless of how you feel about it.

On the left tho.... that whole Rule of Law thing just gets in the way.

Re:I notice the American Right wing

[PrimaryConsult]

In fact, I think that the federal income tax should be abolished entirely and that states should be funding the federal governments out of their tax revenues.

I wouldn't go that far, but a cap of something like 2% on the federal income tax would definitely help. States would be free to increase their taxes to the level the federal one was, and fund whatever programs they find important. Vermont, California, Massachusetts and NY can have universal healthcare. Midwestern states can save for their own tornado reconstruction funds. Florida and New Orleans can have universal flood insurance. The farm states will lose their subsidies but in exchange their tax burden would be practically nonexistent. Food might cost more but the non-farm states could give every resident a "raise" to pay for it by keeping their tax rates low.

Re:I notice the American Right wing

[Enigma2175]

They're in favor of SMALL (ie, less) government moreso than local government.

In general most conservatives have no issue with a higher level of government saying to a lower level "No, you can't do that".

You know how when Linux geeks say "I just want the OS to be unobtrusive and stay out of the way so I can work."? Apply the same logic to government.

No, they say they are in favor of small government but when the rubber actually hits the road they never actually shrink the government overall. Here is a graph of the number of federal employees, where are the big decreases when these "small government" Republicans take office? That graph doesn't count the military, which Republicans tend to increase as well. I'm certainly for a smaller government, but neither of the authoritarian parties are going to provide it, they got into this game for power and money and they aren't going to do anything to reduce either of those.

Re:I notice the American Right wing

[bluegutang]

They're not in favor of small government when it comes to abortion or birth control. Those they want restricted.

As always, they are pick and choose with their "principles".

Re:I notice the American Right wing

[lamer01]

It would an interesting experiment with disastrous implications. Liberal states already have an influx of freeloaders that sip at the state's tit. State governments are not much better than the feds when it comes to wasting taxpayer money. The more liberal the state govt the more waste it seems to have. I don't pretend to know how bad this can get, it definitely requires more extensive analysis than what peeps on slashdot can provide.

Re:I notice the American Right wing

[Anonymous Coward]

Liberal states already have an influx of freeloaders that sip at the state's tit.

That talk radio is rotting your brain.Welfare states are conservative.

Re:I notice the American Right wing

[Uberbah]

I see you are projecting with a side order of willful obtuseness.

Re:Illegal?

[Chris Mattern]

It is legal for many cities to collect income tax--you are right, many cities do that. But not in Washington state, because the state constitution expressly prohibits it.

Re:Illegal?

[MikeDataLink]

It is absolutely legal for a city to collect income tax. MANY cities do just that.

You missed the part about the Washington State Constitution banning city income taxes. NY City is not in Washington.

Flat tax

[manu0601]

This is almost flat tax: if you earn much more than the threshold, the impact gets smaller. For a 2.5 million income, 2.44 million remain after taxation.

Re:Flat tax

[MBGMorden]

I don't think you understand how percentages work . . . yes it's a small percentage, but it's pretty much the polar opposite of "flat".

Re:Flat tax

[manu0601]

I don't think you understand how percentages work

It would have been nice from you to lookup flat tax definition before calling me an ignorant.

Should've Kept Their Trap Shut

[mentil]

Washington's constitution states "a county, city, or city-county shall not levy a tax on net income."

Hope the rich enjoy their tax being based on gross income. Those 'tax writeoffs'? Not so writeoff-able anymore. No response to the 'income is actually property' precedent except "bullshit!".

Re:Should've Kept Their Trap Shut

[Anonymous Coward]

it's not a tax on "net income" it's a tax on income over a certain amount. loopholes aren't just for wealthy individuals and corporations to avoid taxes, or for corporations to avoid pesky annoying environmental laws. governments use them too.

Re:Should've Kept Their Trap Shut

[Anonymous Coward]

On the off chance you are still capable of thinking, through all of that ideology:
"The left" and "the right" don't exist the way you think they do. There is no homogeneous "other side" who believe in the stupidest ideas any member has ever put forward. Stop thinking about politics as a fucking football game and start evaluating individual ideas on their merit, or lack thereof.

Not illegal by my reading

[zooblethorpe]

The relevant sections are on pages 26 and 27 of the Constitution's text, available online here:

http://leg.wa.gov/lawsandagencyrules/documents/12-2010-wastateconstitution.pdf

Specifically (italics mine):

Article VII Section 2 SECTION 2 LIMITATION ON LEVIES. Except as hereinafter provided and notwithstanding any other provision of this Constitution, the aggregate of all tax levies upon real and personal property by the state and all taxing districts now existing or hereafter created, shall not in any year exceed one percent of the true and fair value of such property in money. Nothing herein shall prevent levies at the rates now provided by law by or for any port or public utility district. The term "taxing district" for the purposes of this section shall mean any political subdivision, municipal corporation, district, or other governmental agency authorized by law to levy, or have levied for it, ad valorem taxes on property, other than a port or public utility district. Such aggregate limitation or any specific limitation imposed by law in conformity therewith may be exceeded only as follows:...

There follows three long passages describing the conditions under which such a "taxing district" may exceed the 1% aggregate taxation limit defined previously on page 26. Whether Seattle's particular circumstances meet those conditions, I have no particular comment. I post this merely to point out that Seattle, as a city government, does have a constitutionally viable mechanism for imposing its own tax scheme.

Cheers,

Re:Not illegal by my reading

[bongey]

Property tax is NOT the same as income tax. A levy is the ability to seize your property for paying off an owed property tax.
And somehow your nonsense was still modded up, sock puppet much?

Re:Not illegal by my reading

[ooloorie]

You're citing the wrong part of the tax code. Taxation has to be uniform, this is not.

all taxes shall be uniform upon the same class of property within the territorial limits of the authority levying the tax and shall be levied and collected for public purposes only

Re:Not illegal by my reading

[zooblethorpe]

Yes, I saw that too, in >Article VII Section 1 Taxation, on page 26. However, after searching through the entire document for "property" and "class", the state Constitution does not itself define classes of property, aside from noting in that same section:

All real estate shall constitute one class...

... with further explanation that the Legislature may define other property as exempt from taxation.

So while taxation must indeed be uniform as levied upon a single class of property, I see nothing preventing the Legislature from defining other classes, and then setting different tax rates upon the different classes.

Re:Not illegal by my reading

[zooblethorpe]

First off, wow, you're being an ass.

Second off, instead of bashing me as Some Guy On The Internets, put on your critical thinking cap, read the source text, and educate yourself.

I'll even make it easy for you and copy out the relevant section from page 26 (bolding mine):

Article VII Section 1 SECTION 1 TAXATION. The power of taxation shall never be suspended, surrendered or contracted away. All taxes shall be uniform upon the same class of property within the territorial limits of the authority levying the tax and shall be levied and collected for public purposes only. The word "property" as used herein shall mean and include everything, whether tangible or intangible, subject to ownership.

So for Washington state law, as relates to the state Constitution, "property" would include income.

If your beef is with the word "levy" instead, again, read the source text. You'll find that the word "levy" is used in the more general sense of "to impose or collect by legal authority; the imposition or collection of an assessment". See the Merriam-Webster entry if you'd like.

Search the text of the Constitution itself, and you'll find collocations like the one in the blockquote above, where "taxes" are "levied". Notably, this is not the same thing as a federal IRS levy, which is what you seem to be thinking about. It's important to recognize that different branches and levels of government sometimes use the same terms in different ways.

Cheers,

Re:Punishment v revinew

[epyT-R]

Private sector doesn't get to 'create' jobs. That's not how it works.

Re:elections have consequences

[geoskd]

when you vote for socialists/communists you get your money stolen. Have fun.

Democrats steal from the rich and give it to themselves

Republicans on the other hand, steal from the poor and give it to themselves

Democrat, Republican, it doesn't matter, we've all been had.

A tax targering tech employees?

[firbolgar]

I RTF but I didn't see anything in there that indicated the income tax wold be levied on tech employees who earn leas than $250, but the title sure makes it sound that way. If that is the case, there's no way that passes legal review. Given that the city council knows what they're doing is currently illegal (b/c of the state constitution), I wonder if there is a case for damages to he levied upon the city by those impacted by this illegal tax.

$250k in Seattle is NOT rich

[Anonymous Coward]

The average studio condo here is going for at least $500k these days.

Anyway, the tax will fail. It is mostly for show. It is unconstitutional on the state level.

I don't see that

[rsilvergun]

they want big government for their wars, their bail outs. For their corporate welfare and subsidies. To do the basic research they don't want to spend money on.

I think the quote goes something like this: Socialism for the Rich and Dog Eat Dog Capitalism for the Poor.

If it goes into effect it won't stay at $250K

[boguslinks]

I live in Seattle. You can debate the merits of having an income tax, or not. But you'd have to be an outright moron to think they would keep the threshold at $250K. Now they're saying "we'll have an income tax at $250K, we'll solve the homeless problem with the money". In 4 years, homeless issue will be worse, and they'll say "we'll make it $175K and we'll solve the homeless problem". 4 more years, "Let's make it $100K and we'll solve the homeless problem". Once the mechanism is in place they (the gummint) won't be able to control themselves.

Re:If it goes into effect it won't stay at $250K

[boguslinks]

True, Coward, mathematically, but I don't think local Seattle politicians have that kind of patience. We're not talking about the Damned Rothschilds here, patiently hatching century-long schemes.

Says a Leftist...

[s.petry]

Because the sure fire way to up your standard of living is under Socialism right? If you had not noticed, that only works in rare cases with certain people in power. Didn't work out well for most of the world, and sure as hell keeps people wanting to move out of even the best of the socialist countries. Talk to a Fin, German, or Swede about their great economic mobility opportunities. (real people, not fabricated media reports).

Notice that there is no mention of "local" Government in our founding documents or our Constitution. Pushing to re-establish the Constitution is what the majority of people (read Not Politicians) want. This does put more power back into the State, where it was meant to be concentrated. It is much easier for the populace to have control over their State Government. The State is supposed to be a higher authority than a city/local Government.

If your State does not address the issue, it's not magically a Federal issue. It remains a local/city issue. When the majority of people in that income range move and the city loses all that magical revenue they spent, you can vote them out and put in fiscally responsible politicians.

Re:Says a Leftist...

[swillden]

Because the sure fire way to up your standard of living is under Socialism right?

I don't know that it's clear which is ultimately better; the modern form of socialism (which is capitalism with a strong safety net funded by heavy taxation), or something closer to pure capitalism (pure capitalism exists nowhere). My suspicion is that both approaches work, but which will work in a given country depends on the local culture.

Talk to a Fin, German, or Swede about their great economic mobility opportunities. (real people, not fabricated media reports).

That's stupid. If you want to know about such things, you don't seek out anecdotes, which may tell you very different things depending on whom you encounter, you look for data. Common measures of economic mobility put Swedes, to pick one country, far above Americans. Some more recent research questions those measures which focus only on single-generation changes and look at multi-generational mobility. By those measures, Swedes have roughly the same level of economic mobility as Americans. I don't see any data that indicates they have less mobility than Americans.

That said, I strongly suspect that a regional analysis of the US would yield a different result, because we know very well that mobility varies greatly across different regions of the country. https://www.theatlantic.com/bu.... Perhaps people in Salt Lake City (per that 2014 study, the city with highest upward mobility for moving into the middle class) or San Jose (the city with the highest upward mobility for moving into the top quintile) are significantly more upwardly mobile that people in Stockholm (or whatever Swedish city has the highest mobility). I haven't found any studies that apply the same measurement techniques to make comparison feasible (and even then such things are tricky). But, as a nation, the US is no more mobile than Sweden, and probably somewhat less, which means that extensive safety nets don't kill mobility, and their absence doesn't guarantee it.

Re:Says a Leftist...

[Actually, I do RTFA]

Pushing to re-establish the Constitution is what the majority of people (read Not Politicians) want

Citation very much needed. Leaving aside the fact that most people aren't aware of what the constitution actually says, most people are fine sacrificing their rights for various reasons. That's why we don't just have mob rule.

I'd also say the constitution would be pretty different if developed today. I'm not sure fetishizing it as the unchangeable text from heaven is that great. There are a lot of good ideas, but it's good to approach things from "why, is this still relevant" than assuming what was written must be correct.

Re:Says a Leftist...

[s.petry]

Citations: Read most of Milton Friedman's work. Read anything by Mark Levin. I'm in the middle of Mark's latest, but from there you can find references to countless other sources (he provides hundreds of citations and resources). MSM is controlled media where you won't hear anything they don't want you to hear. This has become a gross propaganda platform. When I was young pro Constitutionalists, such as Milton Friedman, were on TV. Today you hear only what the leftists want you to hear. Even on Fox, you rarely hear a pro Constitutionalist speaking.

Re:Says a Leftist...

[Actually, I do RTFA]

None of that is a citation for "Pushing to re-establish the Constitution is what the majority of people (read Not Politicians) want". What you just said is "here's a good case for why that would be good." But your claim was "people want X".

You then tried to blame the media for determining what people want, which is irrelevant to the question.

In fact, as those are profit-seeking entities, they may have pulled those points-of-view because they were unpopular. That's the whole problem with correlation - if there even is causation, which way does it go.

But I will say most people seem quite happy to sacrifice rights for protection from terrorists and drug dealers.

Re:Says a Leftist...

[Ichijo]

What should we do about our socialized roads?

Re:Says a Leftist...

[david_thornley]

Aside from the roads, the police forces, the fire department, the water, the sewers, education, court system, and defense, what have the Socialists ever done for us?

Re:Says a Leftist...

[bongey]

The problem with socialism is eventually you run out of other people's money. -Margaret Thatcher

Re:Says a Leftist...

[swillden]

The problem with socialism is eventually you run out of other people's money. -Margaret Thatcher

Sweden's debt to GDP ratio is 43.9%, down from 67% 20 years ago.. The United States' ratio is 118.9%, up from 62% 20 years ago.

So, Sweden clearly is not running out of other people's money. Now, perhaps there are other reasons for their situation; I can't remotely pretend to have done an in-depth analysis. Hell, I wouldn't even know where to start, I'm not an economist. But on the face of it, the numbers show Mrs. Thatcher to be wrong.

Again I'll reiterate that I'm not claiming that socialism, in its modern form, is better than something closer to capitalism. The "purest" forms of socialism clearly don't work on anything but a very, very small scale; production falls to nothing and life is hell for everyone except those in charge of enforcing ideological purity. The purest forms of capitalism produce better outcomes overall, but at the expense of heinous conditions for those at the very bottom. So we've already pretty much settled that the right answer is something between those extremes. Exactly where is hard to say... and as I said previously I suspect that the right balance is different for different cultures.

Which rich will be taxed?

[PPH]

Residents of Seattle city proper? Or those who work and earn income within the city? Either way, this will end badly.

I neither work in, nor live in Seattle. But I do live nearby. I wouldn't put it past Seattle to demand income data (and tax returns filed) by everyone living in the region. Just to make sure that a few of the 'evil 1%' aren't trying to slip through the cities tax net with a suburban PO box.

And I see the state being a big pussy and backing Seattle's data demands. To date, I have no obligation to report my income to any Washington State entity, as we have no state income tax. I see this ending. And I see a bunch of local politicians mouths watering when they see the spreadsheet calculations of what they could be taking.

Re:Which rich will be taxed?

[boguslinks]

Note what some folks have said in the past on this... they support the Seattle income tax proposal, as a "test case" to get the entire statewide prohibition on income taxes tossed out, so that Washington can have a state income tax.

Oh Good

[DivineKnight]

Because if it's one thing that the wealthy aren't good at it, it's rewriting these kinds of laws to punish the foolish who try to implement them. /s

May as well have posted that they have finally unveiled a working perpetual motion machine.

You can not tax your way out of wasteful spending

[schwit1]

People are leaving high tax states-rich and poor. Just ask Connecticut, Illinois, New York, California and New Jersey.

https://www.usnews.com/news/be...
http://www.kitsapsun.com/story...
http://www.investopedia.com/ar...

You can also see it in the cost of a 26' UHaul between Texas and California/NY
Los Angeles, CA to Dallas, TX: $2,558
Dallas TX to Los Angeles: $1,232

NY, NY to Dallas, TX: $2,772
Dallas TX to NY, NY: $653

Circle of life

[lucm]

Thanks for the link.

District of Columbia – 4% on the first $10,000, 6% between $10,000 and $40,000, and 8.5% over $40,000

I guess in that instance it's poetic justice, since so many people in DC feed at the public trough. They're basically just a digestive system transforming federal taxpayer money into municipal taxpayer money, removing 91.5% of the value in the process.

Re:Circle of life

[bongey]

DC doesn't have state income tax . Washington State doesn't have income tax either. I could see an issue with a State income tax and city income tax, but comparing it to DC isn't an equal comparison. I do have a general problem with the "tax the rich" , eventually you will run out of "rich people" in the city.

Re:Circle of life

[lucm]

I do have a general problem with the "tax the rich" , eventually you will run out of "rich people" in the city.

In most large cities you can see it immediately at the line between the two jurisdictions: on the core city side the streets are shitty and dirty, and 1 foot away on the suburb city side it's all brand new streets with pretty trees and flowers. Keep fucking the wealthy and they'll move to the suburbs, bringing their tax money with them.

Taxed on business or person location?

[sunking2]

I live in Mass, work in CT. I have to pay state taxes to both jurisdictions. Now I do get to deduct what I pay to CT from the MA, and I admittedly didn't read the article. But is it based on business or employee residence?

Re:Taxed on business or person location?

[sunking2]

Oh, and to add, as this site still doesn't allow editing... NYC I believe is based on employer. At least I believe it's actually a fairly decent reason for players not to go to the Yanks and Mets as regardless where they live they pay a crazy NYC tax. Even if they don't live in NYC.

Fight back

[lucm]

At any rate, those rich aren't really paying much in the way of taxes even if this particular tax is allowed to take effect.

For someone making $250k, that's a $6k tax. It's not bankruptcy but it's like buying the city two venti mochas at Starbucks every day. Just so they can play Social Justice and throw money out the window on misguided programs. Fuck that.

Re:Fight back

[coinreturn]

At any rate, those rich aren't really paying much in the way of taxes even if this particular tax is allowed to take effect.

For someone making $250k, that's a $6k tax. It's not bankruptcy but it's like buying the city two venti mochas at Starbucks every day. Just so they can play Social Justice and throw money out the window on misguided programs. Fuck that.

No, it's not. For someone making $250K, it's a $0 tax. It's called a "marginal tax" - one that applies ONLY to income OVER $250K. Educate yourself.

Re:Fight back

[lucm]

a little extra tax that won't impact their lifestyle but will offset the negative effect they are having on everyone living around them?

That's the dual fallacy of bleeding heart liberals, especially those who don't have themselves a decent income.

First, that wealthy people have a negative effect on people living around them. That's simply not true, you're just demonizing people that *you don't know* for the sake of justifying the theft of their money. Second, tax money doesn't "offset" negative effects, they simply make the city adminisitration fatter and more powerful.

For people who want to help the poor, there's charity and various NGOs. Leave the others alone and take your socialist views to one of those successful socialist countries, as soon as you find one.

Re:Fight back

[AmiMoJo]

First, that wealthy people have a negative effect on people living around them. That's simply not true, you're just demonizing people that *you don't know* for the sake of justifying the theft of their money.

Ah, the poor victim mentality. Note that I didn't demonize anyone, you imagined that because you are unable to overcome your prejudices about me. I don't know exactly who or what you think I am, but I'm certainly not demonizing the well paid people working for Amazon here.

Second, tax money doesn't "offset" negative effects, they simply make the city adminisitration fatter and more powerful.

That's clearly bollocks. I guess when they hire an extra person to collect the refuse from the new McMansions, that's just the city getting fatter and more powerful, not providing a useful and necessary service.

For people who want to help the poor, there's charity and various NGOs.

In other words, you prefer begging. The people who beg the hardest get some cash, the others lose out.

Re:Fight back

[mjwx]

Ahh, one of the many fallacies of the ignorant right who have never earned over US$25,000 and still swallow the line that the rich have it hard whilst they push more of the costs onto you because you wont even question it.

Sorry sunshine, but evidence from London to Singapore to NYC have demonstrated the vaunted exodus of the rich to be false. The amount of tax you pay to live in central London is insane and it's not a ghost town. Same with living anywhere in Singapore or Hong Kong... but people still pay it because they want to live there.

The mega-rich aren't going to move out to Bumfuck, Alamabma with you rednecks because they have to pay a little extra to live in Downtown Seattle... if that were the case Bumfuck would already be full of these people because the market controlled rent prices would have done it long before now. In fact, if they did move out to your precious piece of swamp, you'd instantly start complaining about the amount of tax you're paying to support their uppity, city slicker infrastructure. There are reasons they choose to live in already expensive places, because those places have the standards and amenities they want and they're not going to move out to some god-forsaken shithole in Louisiana for a few extra bucks. Hell, it would probably cost them more to have their amenities shipped in than twice the proposed tax.

You need to abandon these libertarian fantasies, the rich wont just pick up and move and if they did, for a place like Seattle that is a good thing because for every 1 that leaves, 10 more want to take their place. Just like Singapore or Central London.

Re:Fight back

[Ichijo]

For people who want to help the poor, there's charity and various NGOs.

Charities so far have failed to eliminate the cycle of poverty, but maybe if they keep doing the same thing over and over again they will get different results!

How would you eliminate the cycle of poverty? Education is supposed to be the great equalizer but poverty makes it hard to study and learn and so equal access to education tilts the playing field in favor of the wealthy.

Re:Fight back

[AmiMoJo]

The fact that this was modded "troll" is a great example of moderation abuse. It's clearly not trolling, and whoever did it just happens to disagree. Unfortunately, we some people get mod points they use them to censor views that they don't like.

Re:More Taxes???

[LynnwoodRooster]

The Federal Government spends about $1,000 per month per man, woman, and child. And $700 of that is NOT defense/military. If we cannot have your perfect medical/social net for $8500 per year per man, woman, and child - how much more do we need?

Re:tax ALL the rich, no matter WHERE they live

[LynnwoodRooster]

Back in those days, the Federal Government collected less than half it does today, per capita and adjusted for inflation. And the last time it actually lived within its means (no deficit) was 1957. When it was collecting half of what it is today. Perhaps the issue is spending has spiraled out of control - amount and what it's spent on - and that's the problem...

PS: you are part of the rich, at least on a global level...

Hilariously off the mark

[riskkeyesq]

The money lives in Bellevue and Medina, not in Seattle.

What a moronic statement

[Khyber]

"income is property and under the constitution, property tax has to be taxed uniformly and no more than 1 percent."

Yea? Explain why I'm taxed way more than that on my paycheck, please.

Re:What a moronic statement

[bongey]

Me: Seattle is trying to re-define income tax as property tax to get around their state constitution.
CPA Tax Account Wife:.... (nothing but laughing over the phone).

How a City Dies

[LeftCoastThinker]

At 2.25% there probably won't be that big of an impact, but if they ever ratchet it up to 5%, or definitely at 10% you will start to see all kinds of rich homes popping up just outside the city limits, and the city will get no income tax revenue as well as missing out on the property tax revenue, but liberals never quite figure out that the rich are thinking people too who act in their own interest...

MOD PARENT UP

[lannocc]

I already wasted my mods on earlier comments so I'm throwing them away for this reply. I feel as you do, that the states should fund the federal republic directly, and I don't understand why this concept is so underrated. Yes, it's a conservative view, towards reducing bureaucracy.

Re:More Taxes???

[Rockoon]

The sky is the limit....

...because they are very very bad at math. For instance, they think taxing the rich more can balance the budget.

Re:tax ALL the rich, no matter WHERE they live

[iamacat]

Are "the rich" eating all your food, living in all your housing and seeing all your doctors or something? Because if not, you are not going to accomplish anything by reducing the number that the bank keeps for their account balance. Your actual problem is insufficient supply of food, housing and doctors. I would suggest that you look into removing obstacles to provision of more in your area. I bet there are hard working farmers, construction workers and physicians in Mexico that would be happy to help for what for them is good money.

During WWII people were miserable because all resources understandably went to war effort. After WWII, America was propserous because we were able to purchase a lot of raw materials from war-devasted Europe in exchange for domestic manufactured items like cars. We can still do that if we focus on knowledge and capital intensive goods such as genetic engineering and space exploration.

Re:You can not tax your way out of wasteful spendi

[Trailer Trash]

You can also see it in the cost of a 26' UHaul between Texas and California/NY

Los Angeles, CA to Dallas, TX: $2,558

Dallas TX to Los Angeles: $1,232

NY, NY to Dallas, TX: $2,772

Dallas TX to NY, NY: $653

At some point uhaul is going to start paying people to take their trailers back to NY and CA.

Re:You can not tax your way out of wasteful spendi

[Improv]

The best you can do is 1 article that doesn't say what you want it to, another from someone at Heritage, and another at Investopedia?

Washington Police Center?

[bmomjian]

I think the summary meant to say "Washington Policy Center". Wow, only one letter difference.

Inflation will quickly stop only the rich from bei

[SmaryJerry]

They will never change this rule to adjust the limit of the "rich." Over time they will depend on this funding and inflation will make this a tax on everyone and it won't be as long as people think.

Re:You can not tax your way out of wasteful spendi

[rla3rd]

Those U-haul figures have a lot more to do with the higher demand and overhead (rents, higher wages, etc.) of running a franchise in a larger, high cost area with many more locations vs. a low cost area with much less complex coordination requirements than they do with how many people are leaving.

The rental costs are largely set by the originating franchisee, not the central corporate entity.

Yes and there is NO DEMAND to move to New Jersey. I am one of those people leaving New Jersey due to the taxes. I am moving to Florida at the end of the month. What do you think happens to rental truck prices after they have all been used one way leaving the state. The prices have to be much cheaper to entice someone to drive it back.

I hate all taxes with fixed thresholds

[lamer01]

Regardless of who is levying it. It should be indexed for 'real' inflation. In 10 years everyone in Seattle will be making more than $250K.

Re:More Taxes???

[bluefoxlucid]

We can actually get a better social security net with tax cuts everywhere. Not kidding. No tax increases on any individual or business. Decrease in all income taxes, decreased payroll taxes.

Everyone keeps asking for more. People don't want to solve problems; they want to tax someone.

$394k

[whitroth]

That's what it takes for you to be in the 1%.

So, slashdotters, how many folks do you personally know (not from reading about them), that are in the 1%? I know one, count 'em.

But the wealthy and the ultrawealthy need still more tax cuts, because they're job creators, right? Where, other than, say, southeast Asia, have they created these jobs? What percentage are good-paying jobs, equivalent to unionized factory jobs in the US used to be?

Mostly, *not*. What are they doing with the money, other than piling it up like Scrooge McDuck? Why are jobs so hard to find (or haven't you actually had to look for one recently)?

They don't want to pay for quality and experience, they'll outsource to someone who'll get rich by paying the "independent contractors" crap, and making them feel Important by giving them deadlines that mean working 60 or 80 hrs/wk, and being on call 24x7.

No, we don't need higher taxes on the wealthy, and on rich companies (Can you say Microsoft? How 'bout Apple?). They might run away to, um, er, let me get back to you on that.

Wealth is not Income

[WillAffleckUW]

The difference is that you can have a high income and be in debt, or you can have assets which grow.

Most stocks aren't counted as income. This would not tax them. If you work for a startup, most of your compensation is in stocks, so you won't be paying this tax, even if you sell them.

It's a shame how little economics people understand.

If they didn't allow tax deductions to change....

[mark-t]

... the overall level (as in percentage of income) of tax that you pay, then they wouldn't keep needing to come up with shit like this...

People who earn more money are supposed to be paying a higher percentage of their income in taxes than those at lower income levels. I would suggest that while tax deductions can (and should) alter the amount that one may owe in terms of dollars, but the deductions should *not* alter the percentage that they owe.... ie, if before any deductions your annual tax works out to be X% of your total taxable income, then after any deductions have been applied, the annual tax on your taxable income is still X%. The deductions still mean that you pay less overall tax, of course, but they don't get to shelter you from the different overall rates of taxation based on your gross income.

Re:Income Tax is illegal in Washington

[tsqr]

NET Income Tax is illegal.

GROSS is not.

Fantastic. Let me know when you come up with a way to tax my gross income without affecting my net.

hahaha, suck it Seattle

[p51d007]

You want "progressive" garbage? YOU GET IT. What the city council doesn't realize, is a lot of these that can, will move OUTSIDE of Seattle to escape the tax. You'll have more traffic, as people want to travel from OUTSIDE of Seattle to work INSIDE of Seattle. You tax base will go DOWN, not up. Just look at the people that work IN New York City, but refuse to live in NYC because the taxes. Or, a LOT of major "urban" liberal run cities...like Chicago.

Re:You can not tax your way out of wasteful spendi

[Anonymous Coward]

It could also be that individuals in NY and LA don't need a 26' Uhaul because their apartments are so small it fits into a 20' truck nicely. Whereas in Dallas, real estate costs are significantly lower and you are likely to need a larger Uhaul (until you realize all your stuff ain't gonna fit in a NY apartment). I have witnessed that very scenario.

Re:Round vs (Roughly) Spherical

[bcoff12]

Oblate spheroid is the term.

Re:The Next Detroit...

[whitroth]

Wrong. Jobs went, because the car companies, and others, moved them to the non-union South. Then unions started to come in there, and they moved them offshore.

Come on, why waste money paying Americans good wages, when you can get cheap labor elsewhere, and have more profit and salaries for your execs?

All this very heated discussion...

[dddux]

All this very heated discussion because guys who make over $250K will have to pay 2.25% to the city charities? You Americans never stop to amaze me with your sick-minded attitude towards helping people.

Re:All this very heated discussion...

[ooloorie]

You non-Americans never stop to amaze me with your ignorance, and self-righteousness.

the cycle of poverty?

[lucm]

How would you eliminate the cycle of poverty?

The key elements are known but people tend to get their panties in a bunch when it's being proposed.

For instance:

1) Fire the Goldman Sachs puppetmasters at the Fed and raise interest rates to help normal people build a small nest egg instead of providing cheap money to investment bankers.

2) Stop putting single moms on a pedestal; instead, recognize it as a social problem. Children of single moms are immensely overrepresented in prison and welfare populations, while children raised by foster parents are statistically a lot more likely to achieve a good standard of living. There's plenty of competent, financially comfortable foster parents in the country; they're currently "shopping" for children in Asia and Africa because in America we're too proud to consider giving away children.

3) Stop hurting small business owners with federal rackets like Obamacare or unrealistic minimum wages

4) Stop buying products and service from companies that stash obscene amounts of money offshore, like Apple (200 billions => 500% of annual profit) or Microsoft (100 billions => 500% of annual profit). Compare this to Amazon (1.5 billions => 37% of annual profit) or Netflix (650 millions => 20% of annual profit).

Re:tax ALL the rich, no matter WHERE they live

[LynnwoodRooster]

It is? Can you identify which year was the last where the debt went down? The only way the debt increases is if we spend more than we brought in - a deficit. President Clinton had an "on budget" surplus, but that's not the entire budget - there are trillions in off-budget spending every year. And that runs a hefty deficit. Don't take my word for it - look at the link I provided that shows the Federal Government's own numbers. The last time we had an actual surplus - no deficit - was 1957.

Re:More Taxes???

[LynnwoodRooster]

Fully agree! Heck, if we just pegged the budget increases to inflation plus population growth (cost of delivering services plus increase in service demands) we'd grow ourselves out of a deficit in about 12 years (GDP tends to grow faster than inflation plus pop growth, and Hauser's Law gives us faster tax receipt growth over time). But the Federal Government continues to accelerate its spending faster than reasonable, and claims it's not taxing enough.

There are calls always to increase tax rates back up to those of the 1950s and 1960s, but the reality is the Federal Government collects TWICE the tax revenues, per capita and adjusted for inflation, than it did back in those days. It already taxes, effectively, twice as much. And our deficit and debt has only exploded...

Re:tax ALL the rich, no matter WHERE they live

[LynnwoodRooster]

PS: The deficit last year was $1.4 trillion. Of course, that's looking at real numbers, not the made up fantasy shown by the White House. Our national debt for FY2016 went up $1.4 trillion dollars - and that only happens from excess spending. Looking at TreasuryDirect.gov and you'll see the truth.

Re:More Taxes???

[bluefoxlucid]

if we just pegged the budget increases to inflation plus population growth

Not a good strategy. Government shifts strategy continuously, and the amount of service delivered changes year-to-year. In 2011, the amount spent on Federal welfare was 69.8% of the total collected income taxes; in 2016, it was just over 50%.

There are calls always to increase tax rates

I'm more concerned about the "rich need to pay their fair share" complaint. People point at the poor, then point at the rich, then say "they aren't paying enough." No, you fuck sandwich, the problem is the first guy you pointed to doesn't have enough to eat.

You can literally solve that problem and end up with massive tax cuts everywhere. It's trivial. "Tax the rich more" isn't a plan. We need to get aid and stability to the people who need it, not take shit away from the people we think have too much. If that requires raising taxes, fine, so be it; thing is... it doesn't. We can't have a perfect social safety net; we can have a much-more-optimal one for less, though.

When we cut taxes on the rich, we gain the ability to tax them more to fund other efforts. Think about it. We can obviously tax them 40%. If we can get all of our services working and get the poor taken care of while taxes fall on the middle-class, the rich, and the businesses, then what? Suddenly the rich are being taxed 35%, and we ... well, we can tax them 40%. In the future, when someone wants to raise taxes, you have less of that upwards creep to 50%, 70%, 90% taxes; you've gained headroom.

Maybe we should have a plan to lower taxes sometimes, under the assumption that taxes are necessary and sometimes we have to raise taxes, but also that we can't raise taxes endlessly. Consider the tax rate an exhaustable resource and try to reclaim some now and then.

Don't fence me in.

[geowash01]

I understand Seattle also plans to collar all city taxpayers and put up an invisi-fence to keep them from moving to Wyoming.

No, it won't...

[kenh]

"The Seattle City Council estimates that the tax would bring in an additional $140 million each year,"

No, it won't, these 'soak the rich' schemes always over-promise and under-deliver. For example, the State of Connecticut thought their wealthy would happily absorb ever increasing state income taxes, then GE left the state and The Hartford is working on it's exit strategy... and the Gov. is worried.

Down in NJ they have one taxpayer that personally pays so much in state income taxes that if he were to move out of NJ they'd have to reconsider their state spending.

The rich aren't stupid, and they typically have the ability to re-arrange their finances to avoid tax increases like this.