Information Is BeautifulHow rich people avoid paying tax
(Originally by Instgram user @newmoney.blog)
ℂ𝕖𝕝𝕖𝕤𝕥𝕖@infobeautiful Isn't 3 outlawed in most countries?
Eric Maugendre about carbon@rogue_cells
I would not bet on a ban of "borrowing money against the value of their stock, spending the borrowed money as if it were income, and then claiming they have no income for tax purposes."
Solitha@maugendre @rogue_cells Stocks are collateral, like any other collateral. The bank agrees that it is an item with value, that it can claim should you default.
@solitha @maugendre I get that part. I'll have a look into German tax law, whether this would count as tax evasion or not.
If not, that's crazy. Oftentimes, I find such gaping holes in legislation being a typical USian thing. But there are fucked up things all over the world, I guess
If not, that's crazy. Oftentimes, I find such gaping holes in legislation being a typical USian thing. But there are fucked up things all over the world, I guess
@rogue_cells It'd be interesting to know what you find.
I see there are a double handful of German billionaires. I don't know if they aren't as profligate due to taxation, or less wealth imbalance, or both.
@solitha @maugendre I asked a friend of mine, who worked at EY for a long time and he said that in Germany that "hack" is far less powerful than in the US.
What the sharepic is unclear about is that this is only deferring the tax payments, not eliminating them. Due to US tax law, at your death, the deferred taxes are deleted.
In German tax law, there is apparently an upper limit to how long you can defer the payment with that method, so at one point, the tax office will come after you.
@solitha @maugendre Essentially, this is about the "only pays tax when he sells his assets." You can't do that indefinitely here, because at one point the tax office will notice what that you're generating untaxed profits and will drag you to court over it and most certainly win on the basis that you're trying to avoid taxing your income. German law is built in a way that intent matters. There does not need to be a law that sais "you can't do that one specific method."
@rogue_cells That was very enlightening! Thank you so much!
I imagine that kind of law is constantly under assault, but as long as it holds up it seems to be working pretty well.
And I guess the US gives Germans a good reason to keep it strong.
@solitha @maugendre I've not seen anyone try to touch that stuff yet, since I don't think there is a specific law against that specific method (other than some form of "you shall not evade taxes"), but our conservatives/libertarians are constantly trying to lower taxes for companies and prevent everyone from even looking at how low our tax ceiling for rich people is. Raising the tax ceiling would bring in billions that you could use for social welfare and retirement funds, but... yeah.
@rogue_cells The never-ending battle between the don't-have-enoughs and the can't-have-enoughs.
It's so exhausting.