Nearly half of U.S. households escape federal income tax

[oldjones]

Well there's been the usual niggling about details, important and not so, and some passing of information, some useful. But the stats-laden article OTB posted makes no point (perhaps due to editing), so I wonder what it's all in aid of. But I do note this in the article:

The vast majority of people who escape federal income taxes do pay other taxes, including federal payroll taxes for Social Security and Medicare, and excise taxes on gasoline, aviation, alcohol and cigarettes. Many also pay state or local sales, income and property taxes.

So if 53% pay income tax, and the "vast majority of the" other 47% pay other types of tax, then depending how you define 'vast' we're talking tax 'avoidance' by only a small minority of Americans. One might censure the legislators who have failed to tap this untaxed pool, but, if they don't owe, these few Americans don't seem a real problem.

The article does make it clear that US Income Tax is not the 'universal fair tax' that it perhaps was intended to be, but no one seems up for discussing A Universal Fair Tax for Americans. And given how peculiarly American such a topic would be and how misplaced on this board, that may be good.

But in general terms, what's so bad/good about this situation? Over to you OTB, you're the OP.

 

[onthebottom]

Well there's been the usual niggling about details, important and not so, and some passing of information, some useful. But the stats-laden article OTB posted makes no point (perhaps due to editing), so I wonder what it's all in aid of. But I do note this in the article:
So if 53% pay income tax, and the "vast majority of the" other 47% pay other types of tax, then depending how you define 'vast' we're talking tax 'avoidance' by only a small minority of Americans. One might censure the legislators who have failed to tap this untaxed pool, but, if they don't owe, these few Americans don't seem a real problem.

The article does make it clear that US Income Tax is not the 'universal fair tax' that it perhaps was intended to be, but no one seems up for discussing A Universal Fair Tax for Americans. And given how peculiarly American such a topic would be and how misplaced on this board, that may be good.

But in general terms, what's so bad/good about this situation? Over to you OTB, you're the OP.

The fact that half the country has no responsibility for the finances of the country because they will not have to pay the bill but can vote themselves social programs - that is the issue.

OTB

 

[fuji]

The fact that half the country has no responsibility for the finances of the country because they will not have to pay the bill but can vote themselves social programs - that is the issue.

OTB

Wait a minute, your article asserted that the vast majority of them pay other taxes, how is that "no responsibility"?

Moreover some large fraction of them are retired people who spent a lifetime paying income taxes and don't pay that tax anymore only because they are now living off their savings.

It seems to me that you are misrepresenting what the article wrote, moveover, that the article itself contains a bit of a distortion by failing to address an obvious question about the number it presents.

 

[danmand]

The fact that half the country has no responsibility for the finances of the country because they will not have to pay the bill but can vote themselves social programs - that is the issue.

What kind of nonsense is that farting around in your brain, that people who do not pay federal income tax has no responsibility for the country's finances? Where do you get this notions from? Do you want to restrict voting to only rich people, them come out and say it. It would be an insane idea, but you are entitled to your opinion.

And I remember you posted in the thread about GE not paying income tax, that of course GE has the right to avoid paying tax, if the tax laws support it. Do voters not have the same right?

 

[WoodPeckr]

And I remember you posted in the thread about GE not paying income tax, that of course GE has the right to avoid paying tax, if the tax laws support it. Do voters not have the same right?

LMAO!
It seems like bottie is getting tripped up in his own 'smoke & mirrors' machine!...

 

[ig-88]

So what's the point of this thread?

1) Poor shouldn't be able to vote. Ahhh ... plutocracy.

2) Taxes for the rich should be cut. I'd be for that ... if the govt cuts spending, which it can't seem to do, regardless of who's in the WH.

 

[oldjones]

The fact that half the country has no responsibility for the finances of the country because they will not have to pay the bill but can vote themselves social programs - that is the issue.

OTB

But your OP article says they do pay taxes. So what are you talking about? That Income Tax is special? That's the only non-payment mentioned. But why is it special, and therefore a sort of moral failing not to pay it, as compared with other taxes they do pay?

Could it possibly be that the Income Tax is some sort of socialist leveller to extract from each according to his ability to pay and redistribute to each according to his needs? If so, I could certainly see that there is a problem with the citizenry when there are so many needy (from whom we take no tax, as they have so little after buying the bare necessities) and so few who have the wealth to pay. Is that your point?

 

[WoodPeckr]

Originally Posted by onthebottom
The fact that half the country has no responsibility for the finances of the country because they will not have to pay the bill but can vote themselves social programs - that is the issue.

OTB

With a smug plutocratic position like that I'm surprised you don't support 'death panels' to cull the population! Think of all the additional tax cuts the top 1% could get from it!....

 

[Aardvark154]

What kind of nonsense is that farting around in your brain, that people who do not pay federal income tax has no responsibility for the country's finances? Where do you get this notions from?

It has been a while but I seem to recall not just Benjamin Franklin, but Plato in The Republic worrying about the problem of those receiving money from the government while not paying enough in taxes to the government to be concerned about government spending.

 

[WoodPeckr]

It has been a while but I seem to recall not just Benjamin Franklin, but Plato in The Republic worrying about the problem of those receiving money from the government while not paying enough in taxes to the government to be concerned about government spending.

How about companies and corporations who are even worse offenders here?...

 

[danmand]

It has been a while but I seem to recall not just Benjamin Franklin, but Plato in The Republic worrying about the problem of those receiving money from the government while not paying enough in taxes to the government to be concerned about government spending.

We believe in: "Pay according to ability, receive according to need"

 

[WoodPeckr]

We believe in: "Pay according to ability, receive according to need"

That completely Christian concept of being your 'brothers keeper' is condemned as commie/socialism by the selfish self-centered right!...

 

[someone]

Discussions about the equity of any tax system can be interesting and important. Ideally, one should look at overall taxes and not just income taxes, but I am not saying a discussion of the equity of the income tax system alone is not worth well.

However, I think a more important issue is the level of taxes. The fact is that American taxes don’t come near covering the cost of government. You could argue that a lot of the current deficit is due to the recession. However, the American government was spending more than it took in long before the recession, even when the economy was booming. Over time, American taxes are going to have to go up and expenditures are going to have to come down. Politically, this is going to be hard. Recently, I saw one of those tea party protesters being interviewed. First, she was arguing that government should cut back programs. When the interviewer asked about social security (she was clearly old enough to be collecting), she tried to argue that social security was different. I doubt if she is unique. I think that a lot of Americans want their taxes cut but the cuts to only come out of programs they don’t themselves benefit from. Eventually, they are going to have to accept the fact that they are all going to have to start paying more in taxes and getting less from government.

 

[Asterix]

The fact that half the country has no responsibility for the finances of the country because they will not have to pay the bill but can vote themselves social programs - that is the issue.

OTB

As has been pointed out, lower income people pay all kinds of taxes. Payroll taxes, taxes on goods and services, sales tax, transit taxes, gas, utilities, and dozens of other hidden taxes we barely pay attention to. As a percentage of total income, the less well to do pay more than the rich in these kind of taxes. It would be almost impossible to walk out of your house on any given day and not end up paying a tax on something.

 

[fuji]

Discussions about the equity of any tax system can be interesting and important. Ideally, one should look at overall taxes and not just income taxes, but I am not saying a discussion of the equity of the income tax system alone is not worth well.

However, I think a more important issue is the level of taxes. The fact is that American taxes don’t come near covering the cost of government. You could argue that a lot of the current deficit is due to the recession. However, the American government was spending more than it took in long before the recession, even when the economy was booming. Over time, American taxes are going to have to go up and expenditures are going to have to come down. Politically, this is going to be hard. Recently, I saw one of those tea party protesters being interviewed. First, she was arguing that government should cut back programs. When the interviewer asked about social security (she was clearly old enough to be collecting), she tried to argue that social security was different. I doubt if she is unique. I think that a lot of Americans want their taxes cut but the cuts to only come out of programs they don’t themselves benefit from. Eventually, they are going to have to accept the fact that they are all going to have to start paying more in taxes and getting less from government.

This seems so obvious that I wonder why it has to be said--but apparently, it does have to be said.

The same is true in Ontario as well, and to a lesser but real extent at the Federal level in Canada as well.

 

[onthebottom]

Wait a minute, your article asserted that the vast majority of them pay other taxes, how is that "no responsibility"?

Those taxes (payroll, gas, sales, property) are tied to very specific programs and don't fund most Federal programs or agencies.

Moreover some large fraction of them are retired people who spent a lifetime paying income taxes and don't pay that tax anymore only because they are now living off their savings.

One, you've not substantiated this
Two income from savings, capital gains and social security is taxable.

OTB

 

[Aardvark154]

We believe in: "Pay according to ability, receive according to need"

Yes Herr Marx.

 

[danmand]

However, I think a more important issue is the level of taxes. The fact is that American taxes don’t come near covering the cost of government. You could argue that a lot of the current deficit is due to the recession. However, the American government was spending more than it took in long before the recession, even when the economy was booming. Over time, American taxes are going to have to go up and expenditures are going to have to come down. Politically, this is going to be hard. Recently, I saw one of those tea party protesters being interviewed. First, she was arguing that government should cut back programs. When the interviewer asked about social security (she was clearly old enough to be collecting), she tried to argue that social security was different. I doubt if she is unique. I think that a lot of Americans want their taxes cut but the cuts to only come out of programs they don’t themselves benefit from. Eventually, they are going to have to accept the fact that they are all going to have to start paying more in taxes and getting less from government.

That is sort of the standard in america, as posted by OTB. Everybody only want to pay taxes towards the programs they
themselves benefit from. Clearly that can not work for reasons of mathematics.

In more socially advanced societies, people understand that one purpose of taxes, and in particularly income taxes, is to
redistribute funds from the income group that has a surplus to the income group that needs a subsidy.

 

[WoodPeckr]

In more socially advanced societies, people understand that one purpose of taxes, and in particularly income taxes, is to
redistribute funds from the income group that has a surplus to the income group rthat needs a subsidy.

Our myopic mentally challenged righties, products of FAUX Dumbing Down, call that commie socialism now!...

 

[fuji]

One, you've not substantiated this

You're right, there are no retired people in the United States. None whatsoever. At any rate YOU are the one trying to make a point, and until you close this hole, your point is leaking like a sieve.

Two income from savings, capital gains and social security is taxable.OTB

You're smarter than this. You're well aware that people require only a fraction of their pre-retirement income when they retire, moreover, that investment income is preferentially taxed. Thus a person who had a $75k family income pre-retirement would likely maintain the same lifestile on under $50k post-retirement income, given the lower taxes, and the fact that they are no longer having to save for retirement.