The Internal Revenue Service has been making the news (and blogs) recently for its efforts to get more money from wealthy taxpayers.
The new IRS revenue collection initiatives — new audits of business aircraft use and collection notices to wealthy non-filers — piqued my curiosity about other tax matters that focus on the rich.
I found a few — seven actually — and am sharing them in this weekend's Saturday Shout Outs.
Let's start with the man who heads the IRS.
After the aircraft audit announcement, CNBC Wealth Editor (what a cool job title!) Robert Frank talked with IRS Commissioner Danny Werfel. There's a video of their conversation.
But if you prefer reading to watching, check out the CNBC article, which gets the first shout out of the weekend. In it, Werfel says U.S. millionaires and billionaires are evading more than $150 billion a year in taxes, adding to growing government deficits and creating a "lack of fairness" in the tax system.
Shout out #2 goes to an article on an international group's examination of a global minimum tax on billionaires. British newspaper The Guardian reports that G20 leaders gather in Brazil to explore solutions to hypermobile super-rich avoiding tax.
The group, which represents the world's most powerful countries, is looking into a proposal that would levy a minimum tax on the world's 3,000 billionaires, which would end a "race to the bottom" that has enabled the super-rich to pay less than the rest of the world's population.
CNN offers a U.S. take on the international confab, noting in shout out #3 that while a global tax on billionaires is on the agenda, the big question is, "Will it ever happen?"
The G20 global billionaire tax talk was prompted by a report last month from Oxfam, a British-founded confederation of 21 independent non-governmental organizations that focuses on alleviating global poverty. Nearly 80 percent of the world's billionaires live in G20 countries, according to the nonprofit's report (shout out #4), and they pay an effective tax rate lower than the average worker.
Rich push back: Naturally, the wealthy aren't too happy with such suggestions. They also have some support from groups who are opposed to such moves.
The Manhattan Institute notes in its position paper The Limits of Taxing the Rich, which earns shout out #5, that the U.S. federal tax code is already the most progressive in the Organisation for Economic Co-operation and Development (OECD) and has become sharply more progressive over the past 40 years.
Plus, says the New York City-based conservative think tank focused on domestic policy and urban affairs, "an aggressive tax-the-rich agenda that targets high earners and corporations could raise, at most, 1.5% or 2.0% of GDP in revenues—and likely significantly less than that."
Raising taxes on the wealthy often is cited as a way to help stabilize the Social Security program, which most rich people don't have to worry about relying on when they retire. In this weekend's shout out #6, the Tax Foundation looks at a Democratic legislative proposal to raise taxes on people earning more than $400,000 to help bolster the national retirement system.
But, says the Washington, D.C.-based conservative tax policy think tank, relying solely on taxes hikes for the top 1 percent will not fully solve the entitlement crisis, and will hurt economic growth. Rather, the Tax Foundation argues in its analysis Sustainably Reforming Social Security and Medicare Will Need More than Just Tax Hikes.
State burden, too: Finally, we head west for this weekend's final #7 shout out to a MoneyWise report published by Yahoo Finance about wealthy Californians.
The Golden State's 14.4 percent individual tax rate on those earning more than $1 million has prompted those taxpayers to move, according to the article 'We're leaving!': Rich Americans are ditching California and taking their tax dollars with them — and now the tax rates they're fleeing have been raised even higher.
This glimpse of the tax downside of being wealthy is something for the rest of us to ponder. But even given higher taxes, I'd sure like to give being ultrarich a shot!
You also might find these items of interest:
- Mansion taxes in Chicago and L.A. imperiled
- 17 states & D.C. collect an estate or inheritance tax
- A global wealth tax on billionaires would bring in $250B a year, says EU tax group
- Inflation eases tax bites in 2024 on capital gains, estates, and other wealth-related income
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