The fallacy in this assumption is that homeowners’ incomes do not automatically rise along with housing valuations.
In my recent entry Dear Homeowner: If You’re Paying $260,000 in Property Taxes Over 20 Years, What Exactly Do You “Own”?, I questioned the consequences of high property taxes. Some readers wondered if I was saying all property taxes should be abolished. The short answer is no–what I was questioning is local government reliance on property taxes to the point that owning a home no longer makes financial sense because the property taxes consume any appreciation other than the transitory “wealth” generated by a housing bubble. Continue reading »
It is tax day again.
Chances are, you’re done with the dirty business this year, or laying low in hopes that you aren’t audited or flat out persecuted. If not, the clock is quickly ticking.
At this time of the year, millions of Americans are rushing to file their taxes at the last minute, and we are once again reminded just how nightmarish our system of taxation has become. I studied tax law when I was in law school, and it is one of the most mind-numbing areas of study that you could possibly imagine. At this point, the U.S. tax code is somewhere around 4 million words long, which is more than four times longer than all of William Shakespeare’s works put together. And even if you could somehow read the entire tax code, it is constantly changing, and so those that prepare taxes for a living are constantly relearning the rules. It has been said that Americans spend more than 6 billion hours preparing their taxes each year, and Politifact has rated this claim as true. We have a system that is as ridiculous as it is absurd, and the truth is that we don’t even need it. In fact, the greatest period of economic growth in all of U.S. history was when there was no income tax at all. Why anyone would want to perpetuate this tortuous system is beyond me, and yet we keep sending politicians to Washington D.C. that just keep making this system even more complicated and even more burdensome. Continue reading »
(INTELLIHUB) — According to statistical data researched and compiled by TaxFoundation.org, Americans will spend more in 2016 on taxes than they will on housing, food and clothing combined.
Americans will pay “$3.3 trillion in federal taxes and $1.6 trillion in state and local taxes for a total of $4.9 trillion,” according to the chart.
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By now, not even CNBC’s cheerleading permabulls can deny that the US is in a manufacturing recession: in fact, it is so bad that even the staunchest defenders of Keynesian dogma admit what we said in late 2014, namely that crashing oil is bad for the economy.
And yet, the “services” part of the US economy continues to hum right along, leading to such surprising outcomes as a stronger than expected print in Personal Consumption Expenditures. How can this be?
Simple: one look at the chart below should explain not only how the “services” half of the US economy continues to grow, but just which tax, because that is how the Supreme Court defined Obamacare, is responsible for healthcare “spending” amounting to a quarter of the growth in US personal consumption expenditures, almost 100% higher than the second highest spending category which was… Recreational goods and vehicles?
And that, ladies and gentlemen, is how you convert a tax into a source of economic progress.
I never liked the saying: “We are the 99%.” While admittedly catchy and effective as a slogan, I think it is ultimately divisive and counterproductive. The reason I say this is because the statement itself alienates much needed allies for no good reason.
In a country with a population of 320 million, the 1% represents 3.2 million people, which is a pretty big number. While the 1% certainly have far superior material lives compared to the 99%, that doesn’t mean a particularly large percentage of them are thieves, cronies or oligarchs. In fact, it behooves people interested in transitioning to another paradigm to court as many of them as possible to the cause. It is very useful to have well meaning people with resources and connections on your side. To blithely assume there aren’t plenty of potential allies from a pool of 3.2 million is committing strategic suicide.
Much of my focus throughout 2015 was on the pernicious influence of the 0.01%, i.e., the American oligarchy. Indeed, nothing would please oligarchs more than to define a struggle as the 99% vs. the 1% in order to shift attention away from the real root of the problem, themselves. Continue reading »
Earlier this year, quite a few members of the American electorate were distressed to learn that the Clinton Foundation had apparently suffered what we called a “Geithner Moment.”
For those who might have missed the story, when a Reuters investigation revealed discrepancies, the charity decided to refile five years worth of tax returns and review filings dating back as far as fifteen years. At issue were disclosures around contributions from US and foreign governments which Reuters claimed totaled “tens of millions” of dollars in a typical year but which mysteriously disappeared altogether from the organization’s 990s starting in 2010. As we noted at the time, the Foundation was quick to point out that when it comes to charities, it is exemplary in terms of being forthright, but the missing disclosures will likely serve to fan the flames for Republicans who claim Clinton’s ties to the charities could make her susceptible to the influence of outside interests. Continue reading »
Sometimes you just have to stand in awe at the level of corruption and incompetence in government.
Case in point, the new highway bill in the Land of the Free. And, trust me, you’ll love this.
The latest version of the highway bill is called the “Developing a Reliable and Innovative Vision for the Economy Act.” Continue reading »
When independent traders in a small Welsh town discovered the loopholes used by multinational giants to avoid paying UK tax, they didn’t just get mad.
Now local businesses in Crickhowell are turning the tables on the likes of Google and Starbucks by employing the same accountancy practices used by the world’s biggest companies, to move their entire town “offshore”. Continue reading »
– Tax Rebellion in Denmark? (Martin Armstrong, June 4, 2015):
In Fredensborg, Denmark, ten official cars from the Tax Administration Office were set on fire and destroyed overnight in a protest. Police received notification Wednesday night at 3:09 a.m. that the Tax Administration offices on Kratvej were on fire. So far, there are no suspects. The police will undoubtedly hunt for someone retaliating against the Tax Man. Continue reading »
– IRS Admits Refunding Billions On Fake Tax Returns (ZeroHedge, May 29, 2015):
Just hours after being force to admit that they were hacked (by Russians apparently), an inspector general’s report shows that The IRS has rather remarkably continued to pay refunds on hundreds of thousands of fraudulent tax returns in recent years, and sent dozens of checks to the same addresses, including in Eastern Europe and elsewhere. While some progress has been made, $2.3 billion of real US taxpayer’s money was wrongfully refunded to fake US taxpayers… but with this new cyber-attack, we suspect that number will soar.
– Australia To Start Taxing Bank Deposits (ZeroHedge, March 29, 2015):
Up until now, the world’s descent into the NIRPy twilight of fiat currency was a function of failing monetary policy around the globe as central bank after desperate central bank implemented negative and even more negative (in the case of Denmark some four times rapid succession) rates, hoping to make saving so prohibitive consumers would have no choice but to spend the fruits of their labor, or better yet, take out massive loans which they would never be able to repay. However, nobody said it was only central banks who could be the executioners of the world’s saver class: governments are perfectly capable too. Such as Australia’s.
– In Italy, They’re Now Taxing Shadows (ZeroHedge, March 20, 2015):
As Greece struggles to convince the world it’s serious about adopting a series of reforms designed to bolster its economy including cracking down on rampant tax evasion, the Syriza government may want to look to Italy for creative ideas on how to boost government revenue. As Italian newspaper Leggo reports, store owners in Conegliano are now faced with the unfortunate (albeit comically absurd) proposition of paying taxes on shadows.
The rationale appears to go something like this: an awning casts a shadow on public property and therefore you must pay to use that property. Here’s more: Continue reading »
Flashback and an absolute must-watch for all those that haven’t seen this yet.
Feb 14, 2014
America: Freedom to Fascism is a 2006 film by Aaron Russo, covering a variety of subjects, including: the Internal Revenue Service (IRS), the income tax, Federal Reserve System, national ID cards (REAL ID Act), human-implanted RFID tags, Diebold electronic voting machines, globalization, Big Brother, taser weapons abuse, and the use of terrorism by the government as a means to diminish the citizens’ rights.
Tags: Aaron Russo, Banking, Congress, Constitution, Documentary, Dollar, Fascism, Fed, Federal Reserve, Fraud, Global News, Government, IRS, Microchip, New World Order, Politics, Rockefeller, Rothschild, Society, Taxpayers, U.S.
– The Cost Of Obama’s “Free” Community College Plan To Taxpayers? $60 Billion (ZeroHedge, Jan 9, 2015):
>Yesterday, to much shock and dismay, Obama revealed his latest “noble” grand vision: provide a free community college education to millions of folks. Apparently now, far too late, even the community organizer-in-chief realized that with $1.2 trillion in student loans, almost double the total outstanding credit card debt, which as the TBAC warned will rise to a mindblowing $3.3 trillion in one decade all else equal…
… and of which already one third will likely end up unrepaid …
… there is simply no way the US economy can grow and absent a major overhaul of the educational system, the Millennials will never be able to take their rightful place as the dynamo of US economic growth.
What is Obama’s solution? Another free lunch. Continue reading »
– Lawyers Scalp $1.2 Billion From Social Security In 2013 (ZeroHedge, Dec 8, 2014):
Social Security Disability Insurance (SSDI) is no small program, costing taxpayers more than the combined cost of federal welfare payments, housing subsidies, food stamps and school lunches. Attorneys receive taxpayer-funded fees each time they successfully place a client in the program, which incentivizes them to encourage clients to file disability claims. The fees are capped at 25 percent of the successful client’s SSDI award, or $6,000, whichever is less. Attorneys took in $1.2 billion in such fees in 2013, up from just $425 billion in 2011.
– Wall Street Moves to Put Taxpayers on the Hook for Derivatives Trades (Liberty Blitzkrieg, Dec 5, 2014):
Wall Street has for some time attempted to put taxpayers on the hook for its derivatives trades. I highlighted this a year ago in the post: Citigroup Written Legislation Moves Through the House of Representatives. Here’s an excerpt:
Five years after the Wall Street coup of 2008, it appears the U.S. House of Representatives is as bought and paid for as ever. We heard about the Citigroup crafted legislation currently being pushed through Congress back in May when Mother Jones reported on it. Fortunately, they included the following image in their article:
Unsurprisingly, the main backer of the bill is notorious Wall Street lackey Jim Himes (D-Conn.), a former Goldman Sachs employee who has discovered lobbyist payoffs can be just as lucrative as a career in financial services. The last time Mr. Himes made an appearance on these pages was in March 2013 in my piece: Congress Moves to DEREGULATE Wall Street.
Fortunately, that bill never made it to a vote on the Senate floor, but now Wall Street is trying to sneak it into a bill needed to keep the government running.
You can’t make this stuff up.
From the Huffington Post:
WASHINGTON — Wall Street lobbyists are trying to secure taxpayer backing for many derivatives trades as part of budget talks to avert a government shutdown.
According to multiple Democratic sources, banks are pushing hard to include the controversial provision in funding legislation that would keep the government operating after Dec. 11. Top negotiators in the House are taking the derivatives provision seriously, and may include it in the final bill, the sources said.
The bank perks are not a traditional budget item. They would allow financial institutions to trade certain financial derivatives from subsidiaries that are insured by the Federal Deposit Insurance Corp. — potentially putting taxpayers on the hook for losses caused by the risky contracts. Big Wall Street banks had typically traded derivatives from these FDIC-backed units, but the 2010 Dodd-Frank financial reform law required them to move many of the transactions to other subsidiaries that are not insured by taxpayers.
– An Appalling Practice Used In Only Two Nations, Of Which The US Is One (Doug Casey’s International Man):
It’s sort of an obscure story, but it’s also incredibly instructive.
That’s the story of how Eritrea—a tiny, mostly unheard-of country in East Africa—taxes its citizens who live abroad.
Eritrea is one of only two countries in the entire world that taxes its nonresident citizens on their global income. Specifically, Eritrea levies a flat 2% tax on the income of its citizens who reside abroad.
Nearly every other country in the world bases its tax system on residency rather than citizenship. Continue reading »
Taxpayers are footing a bill of nearly £1 million so that civil servants can listen to the radio at work.
Government departments and quangos have been using public money to pay music royalties to allow staff to listen to music in the office. Continue reading »
– Christine Lagarde – The Most Dangerous Woman in the World – IMF Advocates Taking Pensions & Extending Maturities of Gov’t Debt to Prevent Redemption (Armstrong Economics, June 28, 2014):
I have gone on record that the most dangerous organization is the now French led IMF with Christine Lagarde at the helm, which has presented a concept report that debt cuts for over-indebted states are uncompromising and are to be performed more effectively in the future by defaulting on retirement accounts held in life insurance, mutual funds and other types of pension schemes, or arbitrarily extending debt perpetually so you cannot redeem. Yes you read correctly, The new IMF paper is described in great detail exactly how to now allow the private sector, which has invested in government bonds, to be expropriated to pay for the national debts of the socialist governments.
I have been warning that there is an idea that has been running around behind the curtain that the national debt of the USA could be settled by usurping all pension funds in the country. Here is a remarkable blueprint that throws all previous considerations concerning the purchase of government bonds over the cliff. The IMF working paper from December 2013 states boldly:
“The distinction between external debt and domestic debt can be quite important. Domestic debt issued in domestic currency typically offers a far wider range of partial default options than does foreign currency–denominated external debt. Financial repression has already been mentioned; governments can stuff debt into local pension funds and insurance companies, forcing them through regulation to accept far lower rates of return than they might otherwise demand.”
id/Page 8 (IMF-Sovereign-Debt-Crisis)
Already in October 2013, the International Monetary Fund (IMF), suggested the Euro Crisis should be handled by raising taxes. The IMF lobbied for a property tax in Europe that should be imposed where there are no such taxes. The IMF has advocated for a general “debt tax” in the amount of 10 percent for each household in the Eurozone, which also has only modest savings. Continue reading »
– NIRP Strikes: Spain To Create Tax On Bank Deposits (ZeroHedge, June 26, 2014):
It was a little over a year ago, just as the Cyprus deposit confiscation aka “bail in” was taking place, when we asked, rhetorically, if “Spain is preparing for its own deposit levy” when an announcement by Spain’s Finance Minister, Montoro, hinted at the imminent arrival of just that.
Specifically we said: Continue reading »
– Internet Freedom’s Expiration Date (Wall Street Journal, May 13, 2014):
Sales taxers are holding hostage the renewal of a rare bipartisan success.
The idea of taxing email is no more popular today than when President Bill Clinton signed the Internet Tax Freedom Act into law. But a dedicated congressional minority now wants to allow states and localities to tax email—unless these governments are given new powers to collect sales taxes on e-commerce.
On Nov. 1—three days before Election Day—the Internet Tax Freedom Act is due to expire. In place since 1998 and renewed three times, it wisely prohibits taxes that discriminate against the Internet. State and local governments can’t impose burdens online that don’t exist offline. And multiple jurisdictions can’t tax the same online transaction—a critical consumer protection in a country with more than 9,600 taxing authorities. The law also bans email taxes and new taxes on Internet access services. Continue reading »
– Cameron, Confiscation, And “What’s Yours Ain’t Yours!” (Armstrong Economics,, May 10, 2014):
David Cameron has come out and argued that taxes will rise unless he can raid bank accounts in the UK. Cameron argues he will “have to put up taxes” unless tax officials are given draconian powers to raid people’s bank accounts if they think they even owe money. Trust me – all politicians share ideas. Obama is already conniving a way to do the same thing – you can bet on that.
There is no elite private conspiracy of some dominating group. That implies some comprehension of what is even possible. I have sat in the room with such people and these conspiracy stories give these people way too much credit for being intelligent. Nobody smart enough to handle the job ever seeks such positions. Governments are run by lawyer-politicians who think they need only decree some law that solves the problem. They understand nothing. Why should people keep money in a bank in the UK after Cameron makes such a statement? He is way too stupid to realize people act in anticipation. Continue reading »
– The Taxpayer Cost To Maintain Obama’s Golf Handicap: Over $3 Million (ZeroHedge, May 11, 2014):
As the nation shivered through February and March and saw it’s gross domestic product collapse as humans hibernated, President Obama sought sunnier climes to ensure US supremacy on the world-leader’s golf handicap rankings. As The Washington Times reports, however, Obama’s trips this year to the golfing playgrounds of Palm Springs and Key Largo cost taxpayers nearly $3 million for flight expenses alone on Air Force One.
– Exclusive: U.S. Taxpayers To Spend $400,000 For A Camel Sculpture In Pakistan (BuzzFeed, March 31, 2014):
A camel staring at the eye of a needle would decorate a new American embassy — in a country where the average income yearly is $1,250.
– Apple, Microsoft hoard cash – US taxpayers pay the bill (The Bureau of Investigative Journalism, March 17, 2014):
In recent years, America’s technology giants have increased profits to epic levels. So you’d think this good fortune would prove a boon to the fragile American economy.
In theory, a river of tax dollars from America’s cash-rich technology firms ought to contribute towards a significant reduction of the US $17.5 trillion debt mountain.
Only it hasn’t quite worked out that way.
Today, the 1,067 biggest non-financial firms in the United States, according to Moody’s the credit rating agency, have amassed cash and liquid investments totalling $1.48 trillion – a sum equivalent to the entire economy of Spain.
Of this $1.48tn corporate cash mountain, 22% is held by just four companies. Combined; Apple, Microsoft, Google and Cisco Systems retain $331bn in cash, with $255bn held in foreign subsidiaries sheltered from US tax.
But instead of this cash sitting idly in a Bermudan bank vault, new research by the Bureau shows that a substantial amount of the tech giants’ offshore cash is in fact lent to the US government.‘US taxpayers pay interest to tech giants on their offshore cash held there for tax reduction purposes
– A List Of 97 Taxes Americans Pay Every Year (Economic Collapse, March 24, 2014):
If you are like most Americans, paying taxes is one of your pet peeves. The deadline to file your federal taxes is coming up, and this year Americans will spend more than 7 billion hours preparing their taxes and will hand over more than four trillion dollars to federal, state and local governments. Americans will fork over nearly 30 percent of what they earn to pay their income taxes, but that is only a small part of the story. As you will see below, there are dozens of other taxes that Americans pay every year. Of course not everyone pays all of these taxes, but without a doubt we are all being taxed into oblivion. It is like death by a thousand paper cuts. Our politicians have become extremely creative in finding ways to extract money from all of us, and most Americans don’t even realize what is being done to them. By the time it is all said and done, a significant portion of the population ends up paying more than half of what they earn to the government. That is fundamentally wrong, but nothing will be done about it until people start demanding change.
The following is a list of 97 taxes Americans pay every year: Continue reading »
– British Tax Authorities Just Out-Mafia’d The IRS (Sovereign Man, March 21, 2014):
In its 2013 annual report to Congress, the Office of the Taxpayer Advocate wrote that the IRS shows “disrespect for the law and a disregard for taxpayer rights.”
Further, the report says that the current system “disproportionately burdens those who [make] honest mistakes,” and that “tax requirements have become so confusing and the compliance burden so great that taxpayers are giving up their U.S. citizenship in record numbers.”