Tuesday, December 14, 2010

Lottery Winnings & The Estate Tax

What's a fair rate of taxation for lottery winnings? Should society be entitled to any share of manna that falls into our laps because we had the good fortune (or foresight) to be standing in the right place at the right time? 35% on anything over $5 million sounds a bit low to me.

There's the concept of "noblesse oblige" in a moral economy where privilege needs to be balanced with a duty towards the less fortunate. Progressive taxation (including the taxation of estates) is the method of seeking such balance in civilized societies.

Those who are born into great wealth and privilege didn't do anything to earn the same. To paraphrase the late great Molly Ivins, if you're born on third base don't go around claiming to have hit a triple.

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