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Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by newbie12 on Tuesday May 15, 2012 @10:06PM (#3980025)
Saverin's exit is a warning sign, a symptom of a growing sickness in America. All of the envious, hateful attacks on the "top 1%" and the likely prospect of punitive new taxes to support our out-of-control entitlement state make entrepreneurs like Saverin a target, and he knows it.
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by Aloisius on Tuesday May 15, 2012 @10:15PM (#3980049)
Yes, the out of control entitlement state which collects... significantly less taxes than most of the 20th century.

I hate to sound like a populist, but for goodness sake some perspective is necessary.

Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by orangecat on Tuesday May 15, 2012 @11:01PM (#3980244)
Yes, the out of control entitlement state which collects... significantly less taxes than most of the 20th century.

Spending is just deferred taxation, and spending keeps going up. Yes, after adjusting for population and inflation: http://www.usgovernmentspending.com/spending_chart_1970_2017...

Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by dantheman on Tuesday May 15, 2012 @10:46PM (#3980171)
There's a difference between tax rate and effective tax rate; the high taxes of yore were never really paid by anyone with money.
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by eli on Tuesday May 15, 2012 @11:45PM (#3980380)
Prett sure the effective tax rate is declining as well...
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by romeodelight on Wednesday May 16, 2012 @12:19AM (#3980462)
The average effective corporate tax rates last year was 12.1%
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by javert on Tuesday May 15, 2012 @10:48PM (#3980188)
AFAIK your claim is factually untrue by a very large margin. Care to explain?
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by Aloisius on Wednesday May 16, 2012 @12:23AM (#3980471)
The top marginal tax rate averaged about 54% for the 20th century: http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Doc...

It peaked at 94% during WW2, but even absent of any wars, it was significantly higher than it is now (35%).

It was even worse once you work out how much more progressive our tax is now than it used to be. In 1982, you were paying 50% federal tax on all income above $106K (about $200K in today's dollars). Now the top tax rate doesn't even kick in until after $388K.

People today are paying historically low tax rates mostly because of the Republican's cynical attempt to "starve the beast" in order to reduce spending - which I might add is entirely backwards as it gives everyone what they want and no one feels any pain. If they really wanted to reduce spending, they'd force tax raises so everyone felt the consequences of every new government program.

Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by 13rules on Wednesday May 16, 2012 @12:04PM (#3982597)
Completely agree! This is the result of the short-sightedness of a liberal, progressive, tax-the-rich policy. California has already seen what happens when you keep raising taxes, now it's happening countrywide. Wouldn't we rather keep Eduardo and his billions in the US to spend and invest here?
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by mikeash on Tuesday May 15, 2012 @10:22PM (#3980071)
Is it really that awful to want wealthy people to pay at least as much in taxes as the middle class?
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by dantheman on Tuesday May 15, 2012 @10:47PM (#3980180)
They pay way more total money, and most people are complaining about capital gains taxes but that's not really income is it? It's risked capital that has already been taxed at the corporate rates.
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by Drbble on Tuesday May 15, 2012 @11:21PM (#3980313)
Salary isn't income either, it's risked labor that should be deductible as a business expense.
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by dantheman on Wednesday May 16, 2012 @10:29AM (#3982153)
I have always gotten paid for every hour I've ever worked, but I've lost money on investments. In fact, one of the reasons for a wage is so that your risk is limited. In theory you could get paid purely in stock grants and bear the risk that entails.
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by mikeash on Tuesday May 15, 2012 @11:34PM (#3980346)
Can you explain the bit about already having been taxed at the corporate rates? I've seen others mention that but I never quite got it. Say a person buys $1 million of AAPL at $50, then sells at $500, netting $9 million of capital gains. Where and when were the corporate taxes paid on that $9 million?
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by sokoloff on Wednesday May 16, 2012 @12:18AM (#3980458)
If you assume (as many do) there is a relationship between the stock price and the profits of the company, then corporate taxation serves to reduce profits, reducing the stock price. So, instead of rising to $500, it may have risen to $750. The forgone (and invisible) $5 million of appreciation was the loss due to corporate taxation.

(Obviously, the above is too simplistic to actually rely upon, but that's how corporate taxes reduce investor returns, effectively resulting in double taxation in many people's mind, including my own. I still believe that's part of the reason LTCG are and should be taxed at a lower rate than ordinary income.)

Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by seanpreston on Wednesday May 16, 2012 @09:21AM (#3981892)
Stock prices are also influenced by supply & demand. The situation you describe works for just one company paying no corporation tax, but if every company suddenly has no corporation tax, every company's profits increase, so relative demand should stay the same, leaving prices the same.
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by dantheman on Wednesday May 16, 2012 @10:25AM (#3982139)
Stocks can pay dividends which are a direct result of their profits, and so the corporate tax rate effects the amount of actual money that gets paid out. Stocks that don't pay dividends are an interesting case, that is the investors allow the company to reinvest their earnings for growth with the expectation of future dividends.
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by mikeash on Wednesday May 16, 2012 @12:00PM (#3982570)
I can see how this can work, for a stable domestic company that's not reinvesting its profits, but don't both foreign earnings (which affect the stock price but are not taxed by the US) and profit reinvestment defeat that whole idea?
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by waterlesscloud on Wednesday May 16, 2012 @12:12AM (#3980447)
"The average tax rate, including payroll taxes, for the middle 20 percent of U.S. families will be 15.9 percent in 2015, according to an estimate by the Tax Policy Center, a nonpartisan research group in Washington."

Saverin's paying 15%. Sounds like the goal is met.

Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by eropple on Wednesday May 16, 2012 @12:22AM (#3980469)
This is hilariously disingenuous. He's paying 15% on current value and renouncing his citizenship to avoid paying his taxes on its fair market value when the IPO hits.

I'm not by any stretch of the imagination against people making money, but you have an obligation to pay it forward to the society that enabled you to do it. Defending this sort of behavior smacks of the wealth-worshipper disease and there's not a lot worse than that.

Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by waterlesscloud on Wednesday May 16, 2012 @12:46AM (#3980522)
In what way is he not paying back the society that enabled him? He's paying the designated rate, which will be hundreds of millions of dollars, on the present value of the what he's earned.

What would be satisfactory? That he paid based on the ipo price? What the stock is worth at the end of ipo day (likely inflated)? What it's worth a year from now? 5 years? 10 years? What would be fair?

Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by mikeash on Wednesday May 16, 2012 @12:02PM (#3982579)
What would at least be better would be to pay the designated rate when he sells, rather than paying the designated rate on a severely deflated valuation of the company, but only after being given the opportunity to sell his shares at a much higher price.

If I understand the situation correctly. He is basically going to be allowed to pay capital gains on $X after selling for something like $10X, making his rate more like 1.5%.

Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by hnwh on Wednesday May 16, 2012 @02:20PM (#3983295)
Why do you care? really?
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by mikeash on Wednesday May 16, 2012 @02:47PM (#3983417)
Because taxing rich people at or below the rate of middle-class people is part of what allows wealth to become more and more concentrated as time goes by, which has bad consequences for the country in which I live.
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by hnwh on Wednesday May 16, 2012 @03:16PM (#3983544)
Are you really that unaware of how taxes work? Have you never paid taxes before? He's not being taxed at a certain rate because he's rich. The taxes are for capital gains income. If you as a middle class person, or someone on welfare had 100k shares of FB stock, they'd be taxed at the same 15% as if a billionaire had them. If a billionaire went out and earned their income with a job paid at $10m cash a year... then guess what? They're going to pay the same 35-38% rate on that income that you would pay. Its not about the wealth, its about how its made. If you really are concerned about wealth, try to figure out how the system works first before criminalizing those who have
Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by mikeash on Wednesday May 16, 2012 @03:32PM (#3983616)
I'm fully aware of how this stuff works. The fact of the matter is that wealthy people are likely to obtain the vast majority of their income from capital gains, and middle class people are likely to obtain the vast majority of their income from labor. Thus, by taxing capital gains less, you wind up taxing the rich less. No, it's not written into law that way, but that's how it works out.

If you want to continue the discussion, do you think you could try to do without the personal attacks? They're very irritating and completely uncalled for here.

Re:Renouncing citizenship: Did Eduardo Saverin do anything w... by bsimpson on Wednesday May 16, 2012 @01:00AM (#3980562)
A rate is not the same thing as a value. 15% of $1B is a hell of a lot more than 15% of $50K.