Assuming billionaires were going to get a special tax, how would you actually determine how much to tax them? Sure some would be straightforward like Musk where it’s entirely derived from a few companies with known ownership stakes, but what about all the others?

We don’t even know the names of most of the billionaires. With all the games they can play to hide money, now made even easier thanks to the changes Trump made in his first few months, how would you even figure out who and what amount to tax? They don’t have a normal salary or easily documented income like everyone else.

  • AstroLightz@lemmy.world
    41·
    16 hours ago

    EDIT: formatting

    A potential mathematical approach to equal taxation that works in any country:

    1. Calculate the average income of every citizen. Let A = the average income (amount per year)
    2. Set a baseline tax amount for the average (e.g. 10%). Let P = baseline tax percentage
    3. Given a person’s income, calculate how far above or below they are compared to the average. Let I = a person’s income. We can calculate the difference, D, with D = I - A. A positive value means the person’s income is above average, whereas negative is below.
    4. Calculate the difference as a percentage. Let Q = D / A
    5. Calculate the percentage of the tax percentage. This will determine how much more or less a person will have to pay: R = Q * P
    6. Finally, calculate the person’s unique tax amount: T = P + R. If R was a positive value, that means the person will pay more. If R was a negative value, they pay less. If R = 0, they pay the base amount.

    Example: Let’s say the average income per year is $50,000 USD, and the baseline tax rate is 10%

    So A =50,000 and P = 10% / 100 = 0.1

    Given a person’s income: $30,000/yr:

    I = 30,000

    Calculate the difference:

    D = 30,000 – 50,000 = –20,000

    Q = –20,000 / 50,000 = –0.4 (–40%)

    Calculate how much more/less the person pays:

    R = –0.4 * 0.1 = –0.04 (–4%)

    Calculate the unique tax amount:

    T = 0.1 + (–0.04) = 0.1 – 0.04 = 0.06 (6%)

    There might be a better set of formulas, but this is what I came up with. Let me know if I made a mistake in my math.

    • ExperimentalGuy@programming.dev
      2·
      12 hours ago

      I really like this approach. The only problem I see with this is that the measure of center you’re using for the calculation would have to be chosen well. Maybe a weighted average towards lower incomes or using a median, but properly choosing the measure of center would be really important along with verifying that a linear increase or decrease in percentage is also the best solution.

      I think figuring out the rate at which taxation should increase relative to ones income should be the first step, then mapping that onto a set of equations that could calculate taxes would be the best approach.

    • crwth@piefed.zipEnglish
      4·
      15 hours ago

      So someone with an income of $1M (20A) has a tax liability of $2M, and earning $10M means you owe $200M? At least with traditional tax brackets, it’s hard (but not impossible) to accidently get marginal rates over 100%.

      • AstroLightz@lemmy.world
        1·
        11 hours ago

        Yeah, there’s probably a better set of formulas to use.

        The main idea behind my idea is that people who make more pay more, whereas people who make less pay less. Additionally, those who don’t make money pay no tax as it works out mathematically.