The Wealthy Do Pay Their Fair Share

[train]

A few days ago I repeated that I had heard many comments that in the US 50% of the people paid no taxes which I thought was scary Fuji said this wasn't true. Knowing that fuji is usually wrong and has a tendency just to make things up I was curious as to what the real facts were.

Somewhat by accident I came by the information. It was quoted in a CIBC newsletter and I traced it to the source linked below, which tables information obtained from the IRS.

The bottom 50% pay about 2.6% of their income in taxes. Given that they earn a very low proportion of the total income the percentage of the total taxes paid becomes a rounding error of zero rather quickly.

http://mjperry.blogspot.com/2011/07/warren-buffett-is-wrong-on-taxes.html

The data for the table actually comes from the IRS so don't try the typical blog excuse

 

[fuji]

Train, the OTB's claim that 50% of people pay "no taxes" is false because it refers to only one type of tax. Those people pay many other taxes, including other Federal taxes, other income taxes, and so on.

To be a true claim it needs to be qualified. It is not "50% of people pay no taxes" it is "50% of people do not pay one specific tax to one specific level of the government, but do pay other taxes".

Not nearly so headline grabbing when you state it accurately.

 

[onthebottom]

A few days ago I repeated that I had heard many comments that in the US 50% of the people paid no taxes which I thought was scary Fuji said this wasn't true. Knowing that fuji is usually wrong and has a tendency just to make things up I was curious as to what the real facts were.

Somewhat by accident I came by the information. It was quoted in a CIBC newsletter and I traced it to the source linked below, which tables information obtained from the IRS.

The bottom 50% pay about 2.6% of their income in taxes. Given that they earn a very low proportion of the total income the percentage of the total taxes paid becomes a rounding error of zero rather quickly.

http://mjperry.blogspot.com/2011/07/warren-buffett-is-wrong-on-taxes.html

The data for the table actually comes from the IRS so don't try the typical blog excuse

I think the 50% number you hear is really 48% of households and net of benefits (food stamps....) not including payroll taxes (as they supposedly fund entitlements to yourself as forced savings vs help pay the bills). Those rates look low at the top end, heavily influenced by capital gains taxes.... I paid 31% tax last year - not marginal but tax, plus state, plus local, plus payroll tax plus property tax. My tax payments almost qualify as the top 5% themselves.

OTB

 

[danmand]

I think the 50% number you hear is really 48% of households and net of benefits (food stamps....) not including payroll taxes (as they supposedly fund entitlements to yourself as forced savings vs help pay the bills). Those rates look low at the top end, heavily influenced by capital gains taxes.... I paid 31% tax last year - not marginal but tax, plus state, plus local, plus payroll tax plus property tax. My tax payments almost qualify as the top 5% themselves.

OTB

Why are you whining? You are so damn proud of the mighty US military, and you are not paying your fair share as long as the US has to borrow money to support itself.

 

[oldjones]

So the median income of US households is just $38,000 which means roughly half don't make even that much, according to that CIBC newsletter, which also says the lowest bracket folks average out at 2.6% taxes paid. Leaving them a bit over $32,000 after taxes. Could they pay more?

The other 50% of all the taxable income in the US is taxed at anywhere from 13.6% to 23.3%, so at the bottom rate for those above the median (33K to 67K) you get to keep from 28.5K to 58.5K. Should they pay more?

Let's ignore the top 1% of taxpayers making more than $380K—assuming they do pay, after all this is about rates and averages charged not sums collected—and look at the second tier, $160K and up, taxed at 20.7% leaving the poorest among them a mere $126,880 after taxes to scrape by. The richest at just under $390K would have to make do on a mere quarter million. Could they afford more?

Their country is broke, half the housholds—father, mother and kids—make taxable incomes under $38,000, and the best and only solution to their unbalanced books the GOP can come up with is to cut taxes!!

Jesus wept.

Try this: Get everybody's income you possibly can up to that second or third tier, by giving them decent schools and medical care to start them off, and thoughtful supports when they go adrift. It's been demonstrated over and over, that such stuff is cheaper and more effective than the punitive, favouritism of the current set up whether it's the for profit medicine, the stupid law'n'order agendas, budget-starved social services. If you have to tax the top coupla tiers a bit more to do it, they've got the money. When the books balance, they can collect their cuts.

Get that graph evened out, and spend the addtional tax money you'd take in wisely, on results for people instead of profits for corporations and cuts for the rich. Balancing the books isn't hard when you have lotsa taxpayers. Even if you forgave every taxed cent for that poorest tier—and they're almost half of all your taxpayers—you'd be giving them just a coupla bucks a day. Whoopee! They'd rather have a doctor and not lose a day's pay for illness, thanks.

But thanks for illustrating how stupid the 'only tax-cuts' agenda is and who it benefits, train. Although I'd have to quibble and say until the books balance, nobody's share can be called paid.

 

[mjg1]

I think the 50% number you hear is really 48% of households and net of benefits (food stamps....) not including payroll taxes (as they supposedly fund entitlements to yourself as forced savings vs help pay the bills). Those rates look low at the top end, heavily influenced by capital gains taxes.... I paid 31% tax last year - not marginal but tax, plus state, plus local, plus payroll tax plus property tax. My tax payments almost qualify as the top 5% themselves.

OTB

I knew it, you're a rich fatcat. lol

Too bad you can't be a multi-national corp. and move your headquarters overseas, and pay almost no taxes at all!!!!

 

[onthebottom]

Why are you whining? You are so damn proud of the mighty US military, and you are not paying your fair share as long as the US has to borrow money to support itself.

I think that's the point, many of us are paying more than our fair share but half the country is sitting on it's ass voting for reps who offer them more spending programs.....

I am proud of our military, there is now match for it anywhere in the world.

OTB

 

[toguy5252]

That figure is absurd because it does not separate out the families who make so little money that they do not meet the minimum level of income to be liable for income tax. The figure is actually an indictment of the disparity in income in the US because there are so many families who are living at or near the poverty level. In spite of that they pay a host of other taxes that are entirely regressive.

 

[blackrock13]

I think that's the point, many of us are paying more than our fair share but half the country is sitting on it's ass voting for reps who offer them more spending programs.....

I am proud of our military, there is now match for it anywhere in the world.

OTB

Careful OTB

We've had that discussion in some depth earlier on when americanson, who has gone to ground lately, went off about the mighty US military. I'm not dumping on the individuals, just the machine.

'Offering more spending programs' is over simplistic and you're smart enough to know that.

 

[onthebottom]

Careful OTB

We've had that discussion in some depth earlier on when americanson, who has gone to ground lately, went off about the mighty US military. I'm not dumping on the individuals, just the machine.

The machine is inefficient, costly and incredibly capable.... there are not 5 countries in the world the US military couldn't roll over in a matter of weeks.... it's simply a fact.

'Offering more spending programs' is over simplistic and you're smart enough to know that.

Perhaps but not far off... think House elections and the farm program as a starting point....

OTB

 

[blackrock13]

The machine is inefficient, costly and incredibly capable.... there are not 5 countries in the world the US military couldn't roll over in a matter of weeks.... it's simply a fact.



Perhaps but not far off... think House elections and the farm program as a starting point....

OTB

Being the toughest troll on the bridge doesn't make you the best. When there are legions of whiners bitching about the price of wars in the US after beating the war drums loudly, there's always going to be an elephant in whatever theatre of war the US partakes in.

 

[toguy5252]

The machine is inefficient, costly and incredibly capable.... there are not 5 countries in the world the US military couldn't roll over in a matter of weeks.... it's simply a fact.

That could be the problem. the us has build a military machine which can roll over countries. The only problem is that today our enemies are not countries but insurgent groups for which the us is ill equipped to fight. In the meantime senators and congressman keep pushing thei pet projects for more and better weapons to fight the wrong enemy.

 

[mjg1]

What about tax loopholes, don't the rich still use them!

People like Rush Limbaugh and Paris Hilton, can pay more taxes. Bush's tax cuts could be eliminated, and the rich will still be rich.

 

[danmand]

I think that's the point, many of us are paying more than our fair share but half the country is sitting on it's ass voting for reps who offer them more spending programs.....

That is what any model would predict from only a priviledged class having access to higher education, not to mention adequate preventive health care. You have no right to complain, when the policies you argue for are the cause of this situation.

Enjoy your privileged position, there are many advantages for the rich to have a proletariat class. As a matter of fact, whithout it, being rich loses it's charm.

 

[wigglee]

The machine is inefficient, costly and incredibly capable.... there are not 5 countries in the world the US military couldn't roll over in a matter of weeks.... it's simply a fact.


OTB

that's great if you have the moral code of hitler, but if you are a civilized society you'll have no need of that massive military capability. Look at the economic cost this waste has created at home...the country is ready to default . An ounce of diplomacy is worth a pound of military might. Killing for peace has proven ineffective...time for a new plan.....IMAGINE

 

[oldjones]

I think that's the point, many of us are paying more than our fair share but half the country is sitting on it's ass voting for reps who offer them more spending programs.....

I am proud of our military, there is now match for it anywhere in the world.

OTB

First one must define 'fair' in this context. Taking $30Kfrom eveyone across the board sounds fair and is equal, but it leaves half of all US household with $8,000 to live on all year. While the guys in the top bracket, where it's not even 2%, would hardly notice it. And dont forget the folks with the million dollar incomes, that the chart left out, who pay even less than the folks in that top 1%. Fair?

So do tell us what is "more than [y]our fair share" in your terms.

The real problem is that half the country's been bamboozled into thinking they'll get something for nothing by paying less taxes. And the half who will get the real benefit of the cuts already is.

You guys have had a revenue problem ever since Ronnie's guys invented piss on them economics.

 

[train]

So the median income of US households is just $38,000 which means roughly half don't make even that much, according to that CIBC newsletter, which also says the lowest bracket folks average out at 2.6% taxes paid. Leaving them a bit over $32,000 after taxes. Could they pay more?

The other 50% of all the taxable income in the US is taxed at anywhere from 13.6% to 23.3%, so at the bottom rate for those above the median (33K to 67K) you get to keep from 28.5K to 58.5K. Should they pay more?

Let's ignore the top 1% of taxpayers making more than $380K—assuming they do pay, after all this is about rates and averages charged not sums collected—and look at the second tier, $160K and up, taxed at 20.7% leaving the poorest among them a mere $126,880 after taxes to scrape by. The richest at just under $390K would have to make do on a mere quarter million. Could they afford more?

Their country is broke, half the housholds—father, mother and kids—make taxable incomes under $38,000, and the best and only solution to their unbalanced books the GOP can come up with is to cut taxes!!

Jesus wept.

Try this: Get everybody's income you possibly can up to that second or third tier, by giving them decent schools and medical care to start them off, and thoughtful supports when they go adrift. It's been demonstrated over and over, that such stuff is cheaper and more effective than the punitive, favouritism of the current set up whether it's the for profit medicine, the stupid law'n'order agendas, budget-starved social services. If you have to tax the top coupla tiers a bit more to do it, they've got the money. When the books balance, they can collect their cuts.

Get that graph evened out, and spend the addtional tax money you'd take in wisely, on results for people instead of profits for corporations and cuts for the rich. Balancing the books isn't hard when you have lotsa taxpayers. Even if you forgave every taxed cent for that poorest tier—and they're almost half of all your taxpayers—you'd be giving them just a coupla bucks a day. Whoopee! They'd rather have a doctor and not lose a day's pay for illness, thanks.

But thanks for illustrating how stupid the 'only tax-cuts' agenda is and who it benefits, train. Although I'd have to quibble and say until the books balance, nobody's share can be called paid.

There. You've solved the whole problem in a couple of paragraphs. Perhaps you should fire off a copy of this to the US Senate. Who would have thought someone like you would rely on everyone else to pay your way. Lol

 

[train]

Why are you whining? You are so damn proud of the mighty US military, and you are not paying your fair share as long as the US has to borrow money to support itself.

Is that your definition of not paying your fair share? That the country has a deficit? I think you are only looking at one side of the equation. Thought you were a little brighter than that but you are comparable to Old Jones , never thinking that the spending side of the equation must be examined as well.

 

[oldjones]

There. You've solved the whole problem in a couple of paragraphs. Perhaps you should fire off a copy of this to the US Senate. Who would have thought someone like you would rely on everyone else to pay your way. Lol

If there was a solution in there, it would take a magical thinker like you to find it. I'm a Canadian; if you have anything relevant to say about my tax system, it might apply to what I pay. But you might first reflect on whether it's wise to toss around phrases like 'paying your way', without any actual knowledge to back them up. There's a reason they call that stuff 'intelligence' and you're illustrating the lack of it. But magical train thinking aplenty.

Next time you post three sentences of irrelevant response, you might omit the bandwidth waste of a full-quote.

 

[toguy5252]

Is that your definition of not paying your fair share? That the country has a deficit? I think you are only looking at one side of the equation. Thought you were a little brighter than that but you are comparable to Old Jones , never thinking that the spending side of the equation must be examined as well.

So you think that it adds up for Bush to get into 2 wars and reduce taxes at the same time. The deficit and debt were already out of control. Perhaps you could explain that math.