On 29th March 2018, the members of Liberty Discussion Group sat down at Gaia Restaurant and Coffee Shop to discuss the article ‘Tax Justice’ by Michael L. Davis.
In the article, the author discusses the op-ed published by two economist duos Emmanuel Saez and Gabriel Zucman published in The New York Times. He states the argument of these two economists on confiscatory marginal tax rates. The author criticizes these economist on claims that they make on increasing the marginal tax rates will reduce inequality around the world.
The discussants were divided among themselves while debating the relationship between economic growth, taxes and inequality. Some of the participants believed that increasing marginal tax rates is the solution for reducing inequality whereas others were of the opinion that investing more on education and health could be a better alternative. The other topic that was discussed is that taxation of the wealthy does not always mean that it is being properly redistributed and benefitting the poor as historically, imposing high marginal rates on the rich hasn’t meant that the rich pay more in taxes.
The article also criticizes the economist on their claim of increasing marginal taxes by stating that it will make government more powerful as it can be able to take power from some citizens and grant power to others. The participants agreed to this part of the article almost unanimously. Further, major issue discussed on the article and by the participants was that an idealized version of democracy is being taken into consideration while talking about issues such as redistribution of wealth. It was also concluded that rate of economic growth is lower than the rate of rising inequality and increase in marginal tax rate is not a proper solution to tackling with inequality.
As, time was limited, members could not discuss more on these issues even though they desired to. But as always, members can always continue their discussion on the Facebook group.