Anyone with a basic knowledge of maths understands that people who earn more pay more tax.
To illustrate that, let’s keep it simple and work off a theoretical 10% rate.
Someone who earned $50,000 would pay $5,000; someone who earned $500,000 would pay $5,ooo,000 and someone who earned $5,000,000 would pay $500,000.
Of course the one who earned more would have a lot more left after paying their tax and would be much more likely to have investments that gain in value, at least on paper, but don’t incur tax.
The government might calls that economic income. Most of that is more commonly known as unrealised capital gains, the taxing of which would be very unfair.
That doesn’t bother the government which set the IRD the task of researching high wealth individuals.
There is no surprise in what the research found:
The Government has wasted $5 million dollars…
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