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Wednesday, August 4, 2021

Zelenak: 1924, 2021 — Taxes Of The Ultrarich, And Mark-To-Market Reforms

Lawrence Zelenak (Duke), 1924, 2021: Taxes of the Ultrarich, and Mark-to-Market Reforms, 172 Tax Notes Fed. 583 (July 26, 2021):

Tax Notes Federal (2020)On this article, Zelenak tells the story of Treasury’s disclosures of the revenue tax funds of plutocrats virtually a century in the past, which mirror the latest ProPublica revelations of the revenue tax funds of the 25 richest Individuals, and he explores why these earlier disclosures — not like the latest ones — didn’t spark curiosity in mark-to-market taxation of the ultrarich.

In early 1942 Irving Berlin contributed to the battle effort by composing a tune, “I Paid My Earnings Tax As we speak,” and donating the copyright to the federal authorities. The lyrics included the strains, “You see these bombers within the sky / Rockefeller helped to construct them / So did I.” Twelve years earlier, “On the Sunny Aspect of the Road” (music by Jimmy McHugh, lyrics by Dorothy Fields), among the many largest well-liked tune hits of the early Melancholy, featured the strains, “If I by no means have a cent / I’ll be wealthy as Rockefeller.” Within the Twenties, and persevering with by means of the Melancholy and World Battle II, Rockefeller was the songwriters’ apparent option to signify each the most important revenue taxpayers and the ultrawealthy. As we speak, names resembling Bezos, Bloomberg, Buffett, and Musk may properly change Rockefeller in an up to date model of “On the Sunny Aspect of the Road” (at the very least if the names occurred to scan), however the identical names won’t work practically in addition to Rockefeller replacements in “I Paid My Earnings Tax As we speak.”

Rockefeller, Ford, and their fellow plutocrats of a century in the past had taxable sources of revenue — particularly dividends — in quantities at the very least considerably reflective of their web value and of the unrealized appreciation of their inventory. That isn’t true of the American plutocrats of the twenty first century. Absent a most-unlikely sea change within the dividend insurance policies of the firms whose shares are the supply of the wealth and financial revenue of immediately’s multibillionaires, mark-to-market taxation will be the solely option to obtain even the very tough congruence of the Twenties between lists of the payers of the best revenue taxes and lists of the wealthiest Individuals.

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