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Thread: The tax system simplified................

  1. #1
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    The tax system simplified................

    Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this…

    The first four men (the poorest) would pay nothing. The fifth would pay $1. The sixth would pay $3. The seventh would pay $7. The eighth would pay $12. The ninth would pay $18. The tenth man (the richest) would pay $59.

    So, that’s what they decided to do.

    The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve ball. “Since you are all such good customers,” he said, “I’m going to reduce the cost of your daily beer by $20”. Drinks for the ten men would now cost just $80.

    The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still drink for free. But what about the other six men ? How could they divide the $20 windfall so that everyone would get his fair share?

    They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer.

    So, the bar owner suggested that it would be fair to reduce each man’s bill by a higher percentage the poorer he was, to follow the principle of the tax system they had been using, and he proceeded to work out the amounts he suggested that each should now pay.

    And so the fifth man, like the first four, now paid nothing (100% saving). The sixth now paid $2 instead of $3 (33% saving). The seventh now paid $5 instead of $7 (28% saving). The eighth now paid $9 instead of $12 (25% saving). The ninth now paid $14 instead of $18 (22% saving). The tenth now paid $49 instead of $59 (16% saving).

    Each of the six was better off than before. And the first four continued to drink for free. But, once outside the bar, the men began to compare their savings.

    “I only got a dollar out of the $20 saving,” declared the sixth man. He pointed to the tenth man,”but he got $10!”

    “Yeah, that’s right,” exclaimed the fifth man. “I only saved a dollar too. It’s unfair that he got ten times more benefit than me!” “That’s true!” shouted the seventh man. “Why should he get $10 back, when I got only $2? The wealthy get all the breaks!”

    “Wait a minute,” yelled the first four men in unison, “we didn’t get anything at all. This new tax system exploits the poor!”

    The nine men surrounded the tenth and beat him up.

    The next night the tenth man didn’t show up for drinks so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!

    And that, boys and girls, journalists and government ministers, is how our tax system works. The people who already pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.

    David R. Kamerschen, Ph.D. — Professor of Economics
    I do not think outside the box, I do not think inside the box, I do not even know where the box is.

  2. #2
    Merber
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    And how did the rich guy get rich?
    o . o . b . e

  3. #3
    A poor corrupt official
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    Quote Originally Posted by oobe View Post
    And how did the rich guy get rich?
    He probably worked hard, unlike Justin Trudeau who inherited his wealth.
    Strasser: By the way, the murder of the couriers, what has been done?
    Renault: Realizing the importance of the case, my men are rounding up twice the usual number of suspects.
    Heinze: We already know who the murderer is.
    Strasser: Good. Is he in custody?
    Renault: Oh, there's no hurry. Tonight he'll be at Rick's. Everybody comes to Rick's.

  4. #4
    Sol Tee Nutz,

    You sound like a typical right wing conservative. Here is the thing how did the rich get rich. Here are my calculations. The rich who owns hired employees to run his business. Each employee is paid $1/hr... He has like lets say 100 employees. Whatever work they are doing total production cost is $1000 but total profits made from sales are like $1 000 000 per month. So just the cost of labor for all employees provided they worked full time would be roughly $15 000 per month. As you can see the employees do 90% of the work while the owner/CEO takes in 90% of the profits. Now the CEO is greedy and no amount of money is ever enough so he either looks for ways to reduce productions costs by either A)Make the employees work harder and harder thereby increasing production and reducing the amount of employees hired or B)Reduce the pay or C)Send the work to third world countries where labor costs a mere fraction. Either way the rich guy is taking advantage of his power at the workers expense to get richer and richer while the poor get poorer. Now the thing there is a thing as bare necessities and then luxury. The rich guy is still rich whether he earns one million dollars per year or ten mlillion. But to the poor guy that makes so little to the point even $100 extra in his pocket makes a huge difference. So the taxes are a way to moderate things to make things more fairer since the rich guy already exploited the employees and robbed the customers.

    BTW most rich guys nowadays inherited their wealth. Right after WW2 it was a time of prosperity money value was a lot and the work put resulted in large gains nothing like today so most of these large business has been well established since the 1950's.
    One other thing is that the taxes are going to the international bankers who are private got nothing to do with the government and the corporations are the government. Capitalism always results in Crony Capitalism. It is the inevitable effect of having no regulation it is human nature to get corrupt. The greed is eternal.
    There is no knowledge that is not power.

  5. #5
    Quote Originally Posted by CLOUD 500 View Post
    BTW most rich guys nowadays inherited their wealth. Right after WW2 it was a time of prosperity money value was a lot and the work put resulted in large gains nothing like today so most of these large business has been well established since the 1950's.
    Not true...

    Microsoft and Apple are not even 40 year-old businesses... Warren Buffet is a self-made man... So is the guy from Facebook and other techies...

    Did you know that TFSA is only a 6 year-old program? The ten biggest savers in Canada each have over 200 000$ in their own TFSA...

  6. #6
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    Quote Originally Posted by Sol Tee Nutz View Post
    And that, boys and girls, journalists and government ministers, is how our tax system works. The people who already pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.
    With all due respect, this is so poorly tought out it's not worth the time to rebuke point by point. This is the same line of thinking "since humans come from monkeys how come monkeys are still around?". It only makes sense if you don't understand the most basic concepts of what you are discussing - i.e. in this case how taxation works and its purpose in a fonctioning democracy. Seriously dude, put some efforts in your thinking.

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    Quote Originally Posted by Titilleur View Post
    Not true...

    Microsoft and Apple are not even 40 year-old businesses... Warren Buffet is a self-made man... So is the guy from Facebook and other techies...

    Did you know that TFSA is only a 6 year-old program? The ten biggest savers in Canada each have over 200 000$ in their own TFSA...
    For the record Bill Gates was born a Millionaire, his parents were Millionaires and his grandparents were also Millionaires but he did make his Billions from Microsoft.

  8. #8
    Gorgeous ladies Fanatic
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    Quote Originally Posted by Joe.t View Post
    For the record Bill Gates was born a Millionaire, his parents were Millionaires and his grandparents were also Millionaires but he did make his Billions from Microsoft.
    Hello all

    Where they operations revenues or capital gain revenues for the grandparents?


    Cheers


    Booker

  9. #9
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    No clue, I don't have access to their financial records.

  10. #10
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    Quote Originally Posted by oobe View Post
    And how did the rich guy get rich?
    Going to school and working his ass off.
    I do not think outside the box, I do not think inside the box, I do not even know where the box is.

  11. #11
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    All the dippers who believed that only the 1% of the wealthy will see a tax increase crack me up. Already JT is planning a CPP increase that will see a person who makes $42 K a year pay an extra $850, do the math with your own wages, the carbon tax plus cap and trade tax given only to big business will be passed on to you also ( Germany had a 15% cost of living increase ), the increased gas tax will be passed on to you, the cost of trying to go green will be passed on to you and your kids, grand kids, great grand kids,,, well, you get the message. BTW, how is ontario doing ( total job loss of 400,000 due to the liberal government with extra taxes and unions running the government ) 300 billion in debt... fucking idiots and JT wants to follow in Kathleens footsteps, repeat myself, fucking idiots.
    Yes, I am a conservative, I work hard, feed and take care of my family, pay over $75 K a year ( that is with a damn good accountant ) in taxes and do not get my monies worth, getting sick of feeding other people with no ambition or who can not even speak English.... Conservative and proud of it because they gave me the opportrunity to do something with myself.
    Taxing the wealthy does not work because the wealthy have excellent accountants or they will leave, when JT can not get the revenue he wants from the rich he will have no one else to turn to than you...... And again, how is Onario doing and none of it is the Conservatives fault.
    Also note: Ask any economist, having both federal and provincial parties the same is complete stupidity, they will fuck you and turn you over and fuck you again.
    My rant for the week. Enjoy the Liberal term because in 2-3 years you will realise what you did and not make the same mistake again....
    I do not think outside the box, I do not think inside the box, I do not even know where the box is.

  12. #12
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    Quote Originally Posted by eviltmp View Post
    With all due respect, this is so poorly tought out it's not worth the time to rebuke point by point. This is the same line of thinking "since humans come from monkeys how come monkeys are still around?". It only makes sense if you don't understand the most basic concepts of what you are discussing - i.e. in this case how taxation works and its purpose in a fonctioning democracy. Seriously dude, put some efforts in your thinking.
    Pardon! This is a simple breakdown of how it should work with taxes, not the way it is going to happen. You can not tax the wealthy only and give breaks to the middle class, I thought the beer example would not be over anyones head.
    I do not think outside the box, I do not think inside the box, I do not even know where the box is.

  13. #13
    Quote Originally Posted by Sol Tee Nutz View Post
    Yes, I am a conservative, I work hard, feed and take care of my family, pay over $75 K a year ( that is with a damn good accountant ) in taxes and do not get my monies worth, getting sick of feeding other people with no ambition or who can not even speak English.... Conservative and proud of it because they gave me the opportrunity to do something with myself.
    Taxing the wealthy does not work because the wealthy have excellent accountants or they will leave, when JT can not get the revenue he wants from the rich he will have no one else to turn to than you...... And again, how is Onario doing and none of it is the Conservatives fault.
    Also note: Ask any economist, having both federal and provincial parties the same is complete stupidity, they will fuck you and turn you over and fuck you again.
    My rant for the week. Enjoy the Liberal term because in 2-3 years you will realise what you did and not make the same mistake again....
    So what if you own a business does that give corporations the right to exploit poor working people just in the name of profits? When does the greed end? With your mentality life would pretty much be like it was during the industrial revolution read up on it-> https://www.q-files.com/history/brit...ntury-britain/

    And btw I am not talking about white collar professionals here they actually worked their ass off and deserve it if you ask me I think they are underpaid and over worked. I am talking about corporations. Corporations are not people. Right wing government leads to Crony Capitalism. This is what Harper was all about. Since he came into power Canada has went into a major recession. Whenever there is a conservative in power the economy turns into a mess. Look at Brian Mulroney another example. Harper rather spend money on the military then on education. Why is work being outsourced to third world countries? There is also the foreign worker program. Since you are in Alberta you must know of this very well. They are getting foreign workers to work as slave laborers. They are guaranteed a full time job as to replace Canadian jobs. So lets us see the corporation reduced their cost of production but when they sell their product the price is higher and so is the quality lowered? Does not make sense. Canadians are loosing jobs because of this. All those working people are now out of the job now. We are living in the jobless generation and the ones paying are the young people. The only thing the conservatives do is protect the riches of the elite and corporations. They let them exploit people further. Then they use chemicals in foods to increase yield all in the name of profits. Corporations are paying a fraction of the taxes that working people do. It does not matter who pays the price or who gets sick so long as a profit is made. When does it end?? When is it enough.

    Taxes are a good thing when uses correctly. It allows the guy who is not born into a rich family to go to school and get be well off. Or you end up with the US type system where you got to pay $10, 000 a year in school. It also allows most to have access to health care. Ya it is not great but at least they can. Furthermore who is to pay to maintain the infrastructure? Maintenance? Picking up garbage. I say good Justin Trudeau tax those damn corporations and they should be strictly regulated. Even outsourcing of work should be completely banned. Want to do business here you must employ Canadian workers. We got a minimum wage yet we do not have a maximum wage? There should be one.
    There is no knowledge that is not power.

  14. #14
    Quote Originally Posted by Titilleur View Post
    Not true...

    Microsoft and Apple are not even 40 year-old businesses... Warren Buffet is a self-made man... So is the guy from Facebook and other techies...

    Did you know that TFSA is only a 6 year-old program? The ten biggest savers in Canada each have over 200 000$ in their own TFSA...
    Here is an example of what I am talking about. If it were not for the CRTC the big three telecommunication service providers would crush any entrants attempting to start a business-> http://www.theglobeandmail.com/repor...ticle27030604/

    Corporations use their power and resources to regulate the economy to exploit their workers and rob their clients. Bell was here before all these companies. Bell is massive no other company will ever be able to compete with Bell or even Rogers. Not fair. They will use their power to muscle out any other company = Less Competition = Higher prices. Bell has been around since the 19th century. This is what I am talking about. CRTC made a ruling that Bell allow independent service providers to use their network and also Rogers to allow for competition. Had it not been for Wind Mobile or Public Mobile none of these companies would have ever brought the unlimited airtime plan. They were gouging customers with airtime. There are many other things but this is just the tip of the iceberg. The market is already saturated opportunities are very limited now.

    The TFSA is BS. It is great for people who already have money but for a lot of people they are living paycheck to paycheck the way they charge very high prices and pay them so less they got no savings.
    There is no knowledge that is not power.

  15. #15
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    Quote Originally Posted by Sol Tee Nutz View Post


    And that, boys and girls, journalists and government ministers, is how our tax system works. The people who already pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.

    David R. Kamerschen, Ph.D. — Professor of Economics
    The rich don't paid enoug tax.
    They can leave, there will be another one to take their business.
    They will never leave, because they still make money.

    Man911, Ph.D. - Logic

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