Tags: bill gates | extreme | wealth | tax | plans

Bill Gates: Dem Wealth Tax, Economic Theory 'Crazy Talk'

Bill Gates: Dem Wealth Tax, Economic Theory 'Crazy Talk'

By    |   Tuesday, 12 February 2019 02:44 PM

Microsoft founder Bill Gates says he supports "more progressive" taxes on the rich, but proposals targeting high income brackets, like a plan from Rep. Alexandria Ocasio-Cortez, are missing the point.

Ocasio-Cortez, a freshman Democrat from New York, floated a 70 percent top tax rate on incomes of $10 million or more, an idea that 59 percent of people supported in a Hill–HarrisX poll conducted Jan. 12-13, Bloomberg reported.

Such an approach is "a misfocus," Gates told The Verge.com.  "If you focus on that, you're missing the picture," he said without mentioning the Democratic socialist congresswoman by name.

Before You File Your Taxes, You Must Read This

Gates suggested that tax policies should focus on taxing wealth rather than income since the rich, wealthy and famous tend to have more of their wealth tied up in assets instead of income.

"In terms of revenue collection, you wouldn't want to just focus on the ordinary income rate, because people who are wealthy have a rounding error of ordinary income," Gates told The Verge. "They have income that just is the value of their stock, which if they don't sell it, it doesn't show up as income at all, or if it shows up, it shows over in the capital gains side. So the ability of hedge fund people, various people — they aren't paying that ordinary income rate."

Gates said lawmakers should focus on things like the estate tax, taxes on capital and Social Security.

But instead, there have been radical wealth-tax ideas, such as what Ocasio-Cortez seeks.

"Now, you finally have some politicians who are so extreme that I'd say, 'No, that's even beyond,'" Gates said, without mentioning anyone's plan by name.

"You do start to create tax dodging and disincentives, and an incentive to have the income show up in other countries and things. But we can be more progressive without really threatening income generation — what you have left to decide how to spread around."

Gates spoke approvingly of a general wealth tax, the estate tax, and changes to Social Security in order to increase tax revenue.

“But we can be more progressive, the estate tax and the tax on capital, the way the FICA and Social Security taxes work. We can be more progressive without really threatening income generation.”

Gates also took exception to “modern monetary theory,” which is an economic theory with growing prominence on the policy teams of Ocasio-Cortez, Bernie Sanders, and others.

MMT, as it’s known, suggests that governments need not worry about deficits because they can simply print their own currency, and should instead manage inflation with interest rates, the Verge explained. “That is some crazy talk,” he told me. “It will come back and bite you.”

However, the concept of higher taxes on the wealthy hasn't been universally rejected.

JPMorgan Chase Chief Executive Officer Jamie Dimon, who leads one of Wall Street’s biggest banks, recently said that the ultra-rich could afford to pay more taxes as a wider political debate rages over increasing taxes for the wealthy.

“I believe that individuals earning the most can afford to pay more, and I have no problem paying higher taxes to address some of the fundamental challenges and inequities in our society,” Dimon said in a statement emailed by JPMorgan, in response to questions posed by reporters, Reuters reported.

“However, we need to ensure that our tax dollars are going where they can be most effective - like expanding the earned income tax credit and other programs that support the people and communities who really need it,” Dimon added.

Trump’s April 15 Deadline: Tax Loophole Saves Thousands

Material from Bloomberg and Reuters has been used in this report.

© 2021 Newsmax Finance. All rights reserved.


StreetTalk
Microsoft founder Bill Gates says he supports "more progressive" taxes on the rich, but proposals targeting high income brackets, like a plan from Rep. Alexandria Ocasio-Cortez, are missing the point.
bill gates, extreme, wealth, tax, plans
610
2019-44-12
Tuesday, 12 February 2019 02:44 PM
Newsmax Media, Inc.
 
Newsmax TV Live

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved