No. Really.
In 2006, the latest year for which we have Census data, 220 million Americans were eligible to vote and 89 million — 40% — paid no income taxes. … [T]his will jump to 49% when Mr. Obama’s cash credits remove 18 million more voters from the tax rolls. What’s more, there are an additional 24 million taxpayers (11% of the electorate) who will pay a minimal amount of income taxes — less than 5% of their income and less than $1,000 annually.
In all, three out of every five voters will pay little or nothing in income taxes under Mr. Obama’s plans and gain when taxes rise on the 40% that already pays 95% of income tax revenues.
The plunder that the Democrats plan to extract from the “very rich” — the 5% that earn more than $250,000 and who already pay 60% of the federal income tax bill — will never stretch to cover the expansive programs Mr. Obama promises.
Of course not, which is why he’ll raise taxes on businesses. Big Oil. Big Pharma. Big 7/11.
I mean, faced with rising costs what are they going to do about it? Lay people off? Pass the costs off to the rest of us in the form of higher prices?
As if.
If I were one of the 5%, I’d be making plans for my journey to Galt’s Gulch.
I’m glad I don’t have to buy anything from businesses.
Hey–wait a minute!
Oyster, though I have faith in our Republic, I may be asking you rather soon where Galt’s Gulch is located.
Most of the trouble is the people that don’t pay any taxes. There should be a minimum for everyone. People get touchy when they think “their” money is being wasted.
Might I suggest the Isle of Jersey? It has its own laws, currency (although the Pound Sterling is also in dual circulation) and is nominally independent of the UK for most purposes (see Wiki) I’ve “lived” there for years–also gives me a good excuse to get out of the Country to go visit my money. Is more or less Obama proof as Jers
damn….cont’d…how DOES the keyboard jump by just hitting space bar? Anyway…..most Jersyites are fiercely in-dependent and not likely to bow to international of US pressure to change their tax laws, unlike say, the Caymans which are near enough to the US to be really leaned upon by a US Govt desperate for revenue. Notice that Argentina has just nationalized private pensions in a cash grab? Coming soon to a zip-code near you under an Obama Administration. You do know, don’t you, that just prior to the GOP gaining control of Congress the Clinton Administration was readying legislation that would have taxed the
“inside build-up” of both private pensions and cash-value life insurance–
both of which currently accumulate tax-free. Bet money that this proposal will be revived under Obama.
Wow. Five percent of the people paying 60% of the taxes sure sounds unfair, doesn’t it?
Looking at the IRS tax stats page, the data is broken down with the breaks at $200k and $500k, not $250k.
3% of the people had incomes above $500k. This 3% had 54% of the income, and paid 50% of the taxes.
12% of the people had incomes above $200k. This 12% had 73% of the income, and paid 71% of the taxes.
I’d like to make a sarcastic comment here, but I’m not as good at it as Lex is. So I’ll just say that it does seem unfair: why do we have those with more of the income paying less of the taxes?
If it were true, then it would be troubling, but it isn’t true. In a great head fake, the table you point to has no income data, only tax. The correct table, shows:
>$200K — 2.1% of returns, 37% of income, 51% of taxes
$50K – $200K — 44% of returns, 46% of income, 40% of taxes
< $50K — 54% of returns, 15% of income, 9% of taxes
Crappy intellectual honesty, but a great head fake. Is that you, Allen Iverson?
“A democracy will continue to exist up until the time that voters discover they can vote themselves generous gifts from the public treasury. From that moment on, the majority will always vote for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by dictatorship.” – Alexander Tyler, English Historian.
The notion that a significant percentage of people should pay no tax is destructive, as Quartermaster said.
Gotta hope for change, I think my dollars are history.
George V.
All people do pay some taxes though. They pay sales taxes, excise taxes, gas taxes and FICA. Its not simply income taxes.
Skippy-san,
True enough that there are many forms of taxes. But the personal income tax is the one that gets the most attention in a presidenntial election year. This campaign concept of “vote for me and you won’t pay any income tax” is bothersome. It reinforces the concept of getting something for nothing as opposed to the concept of sharing the load.
I’m not proposing that all workers should pay something in income tax (although an argument can be made in favor of that). I am suggesting that 40% of workers paying no income tax is too many and raising that to 49% is an even worse idea.
If a politician says tax rates on higher incomes should be raised, that’s simply their position.
But the politicial who says taxes on the wealthy should be raised and a higher percentage of people should pay no tax is stating that a significant percentage of the electorate deserve something for nothing, and in effect is buying votes.
Scott, sorry, what does % of return mean? % of income and % of taxes each add up to ~100% so I guess it is the share of the national income res. tax payments.
FICA is not a tax. It an “investment” in your social security account. With Pelosi, Reid, Schumer, and Frank managing it, I’m expecting huge returns – just like I got off of my real estate, thanks to their good work.
For those of us who are not (thank God) considered Baby Boomers, Social Security is the great ripoff of our time. The amount we loose by paying for all of our working life into an account that will dry up just about the time we can withdraw from it will make last month’s $700B look like money you throw at a stripper.
hajo-hi — “% of returns” is the percentage of total # of returns filed.
Damn. Too many really short nights this week trying to get not one but two projects out the door for no-longer-patient clients, and I blew the calculation. In a perfect world, one would sleep and not drink before posting, but where would the fun be in that?
The complete publication has the totals “Accumulated from the Smallest Size of AGI” and “Accumulated from the Largest Size of AGI” already calculated in table 1.1 and they’re close enough to Scott’s to not quibble about.
And Scott’s percentages are from the returns owing taxes, but table 1.1 also includes statistics for total returns, which includes the returns which don’t owe tax. The category <$50k is 64.7% of the total returns, compared to 51.6% (IRS) or 54% (Scott) of the taxable returns. Including the ones which don’t owe taxes also changes the percentage of the income from 17.5% (IRS) or 15% (Scott) to 23.5%. All of which appreciably strengthens Scott’s (and Lex’s) point.
Sorry. Honest mistake. Really.
You got it Nose (on the nose, as it were…). I was born in 1963 so technically I’m considered a Boomer, but not for one second do I think I’ll ever see a dime of what I’m putting into SS. We plan our retirement to exclude any kind of SS payment. Seems safer. If we’re wrong, well then hooray for us.
Sadly, I don’t think we’ll be wrong.
Okay, let’s talk about “fair.” With the system we have now, the more you make the higher percentage you pay, up to a point right? ( I know, rich people have all kinds of deductions so pay less, let’s just put that aside a minute.)
So, the argument for a flat tax fixes some of that, we all pay 10% or something, no matter what we make.
But, let’s look at our taxes as paying for something. We’re paying for government services. If you make $50, 000 a year and pay 10%, you pay $5000. If I make $500,000 a year and pay 10% I pay $50,000. Right? So I’m getting 10 times the government service, since I pay 10 times as much. Oh, wait a minute…
And we can carry that on even further. If you want to buy a Toyota, you pay $30,000, but, since I make more money I should pay $300,000, right?
Having the tax rates go up as income goes up has never made sense to me.
And don’t get me started on Social Security. It’s a case of creeping entitlement. What was started a s a supplement, to help people out who lived too long turned into a full blown pension plan, but without the requisite increase in funding.
I say we phase out the whole thing, and mandate that anyone under about 30 invests there own money. But that’s just me.
Idaho Joe wrote:
“If you want to buy a Toyota, you pay $30,000, but, since I make more money I should pay $300,000, right? ”
SHHH!! QUIET!!! Don’t give them any ideas!
George V.
Nose,
I am a boomer and proud of it. I’ll be happy to take your money and spend it. If you would like to cut out the middle man you can just send me a check now.
Oyster — won’t work.
Galt’s Gulch is now solidly Obama territory.
Thanks. Silly me. We weren’t told that meaning of “return” at school.
hajo-hi — I can identify. Like many of my discoveries auf Deutsch en dem Volkshochschule. Such as the difference between meine Freundin, and eine Freundin.
FICA is not a tax per se, it’s a tax with a promise of return that cannot be kept, unless we suffer from a truly destructive plague or start having kids so fast we’ll have trouble remembering all their names.
That said, I don’t particularly mind paying taxes, I just hate the fact that I pay them every two weeks without notice and on April 15th I find out if the government held my money at 0% interest for a year or if I owe money plus some penalty for not giving them the float.
Part of the problem is we don’t know what we pay in taxes, because the confiscation is done for us. Make us each write a check on April 15th for the full amount and you’ll see a rebellion.
Naturally, this course of action will never happen.
– Max