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I think that taxation of earned income should be relatively low, but taxation on unearned income should make up for it.

It is not the owner of a productive asset who earns money, but rather the asset, and there is no reason whatever why privileged property rights - such as exclusive rights over the commons of land or knowledge; or 'free' limited liability on investment through joint stock limited liability corporations - should not be taxed.

It is a misleading canard to say that people are taxed twice: they are taxed once (too highly IMHO) on earned income and then the income from the asset is taxed.

There is a bonus here in that taxation of such property rights is much less avoidable, and much easier to collect. Friedman himself considered Land Value tax to be the 'least worst' and most economically efficient tax.

So I would (if I did not regard taxation as pretty Last Century)  advocate drastic cuts in taxation of earned income and commensurate increase of taxes on unearned income from privileged property rights.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Fri Jan 20th, 2012 at 11:17:54 AM EST
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