Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
and the top 5 and 10 percent earnings and wealth are disproportionately higher. As of 1998, the top 10% owned 68.8% of the total wealth in this country.
http://www.lcurve.org/WealthDistribution-1998.htm
The percentage is probably even higher today.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
(snip)Here are the wage earners in each category and the percentages they pay:
The top 1% pay over a third, 34.27% of all income taxes. (Up from 2003: 33.71%) The top 5% pay 54.36% of all income taxes (Up from 2002: 53.80%). The top 10% pay 65.84% (Up from 2002: 65.73%). The top 25% pay 83.88% (Down from 2002: 83.90%). The top 50% pay 96.54% (Up from 2002: 96.50%). The bottom 50%? They pay a paltry 3.46% of all income taxes (Down from 2002: 3.50%). The top 1% is paying nearly ten times the federal income taxes than the bottom 50%! And who earns what? The top 1% earns 16.77% of all income (2002: 16.12%). The top 5% earns 31.18% of all the income (2002: 30.55%). The top 10% earns 42.36% of all the income (2002: 41.77%); the top 25% earns 64.86% of all the income (2002: 64.37%) , and the top 50% earns 86.01% (2002: 85.77%) of all the income. (snip)
so by your implied 'fairness doctrine' ... both groups are paying far above their 'fair share' ...
the top 5% of American earners actually earn 31% of all income but pay 54% of total income tax dollars
the top 10% of American earners actually earn 42% of all income but pay 66% of total income tax dollars
... in contrast ...
the bottom 50% of American earners actually earn 14% of all income but pay just 3 1/2% of total income tax dollars
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
We bitch about the weather in Canada...it's our right as Canadians. ;D
In the U.S., I guess it's taxes. But really, we are so fortunate to live where we do. Think of all the crummy places we could have been born in. Most of us have never known extreme hardship.
The wealthy pay a disproportionate amount of the total taxes? Great, that's how it should be. They still get to be...wealthy. They get to have wonderful luxurious lives. That's as it should be too.
Deciding who pays what amount of money, and deciding what is done with that money is the essence of politics. You'll have as many different opinions about that as there are citizens.
Just my two cents on a sunny Saturday morning.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Quote:
Originally Posted by
eagle2
Eric,
I doubt very much that you, or anyone else, pays over half of their income in taxes. Even before Bush's tax cuts, the wealthiest Americans were paying less than 1/3 of their income in federal taxes. I doubt that there are enough state and local taxes to put that even near 50%.
(snip)
On average, each of the 400 top taxpayers paid more than $21 million in federal income taxes last year on income of more than $64 million, according to estimates based on the IRS data.
(snip)
and this article was from Before Bush's tax cuts were passed.
There is much doubt in this one Mhhrrrrmmm Mmhhhrrrrrmm Mhhrrrrmm!!!!
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Quote:
Originally Posted by
Melonie
(snip)Here are the wage earners in each category and the percentages they pay:
The top 1% pay over a third, 34.27% of all income taxes. (Up from 2003: 33.71%) The top 5% pay 54.36% of all income taxes (Up from 2002: 53.80%). The top 10% pay 65.84% (Up from 2002: 65.73%). The top 25% pay 83.88% (Down from 2002: 83.90%). The top 50% pay 96.54% (Up from 2002: 96.50%). The bottom 50%? They pay a paltry 3.46% of all income taxes (Down from 2002: 3.50%). The top 1% is paying nearly ten times the federal income taxes than the bottom 50%! And who earns what? The top 1% earns 16.77% of all income (2002: 16.12%). The top 5% earns 31.18% of all the income (2002: 30.55%). The top 10% earns 42.36% of all the income (2002: 41.77%); the top 25% earns 64.86% of all the income (2002: 64.37%) , and the top 50% earns 86.01% (2002: 85.77%) of all the income. (snip)
http://www.irs.gov/pub/irs-soi/04in06tr.xls
so by your implied 'fairness doctrine' ... both groups are paying far above their 'fair share' ...
the top 5% of American earners actually earn 31% of all income but pay 54% of total income tax dollars
the top 10% of American earners actually earn 42% of all income but pay 66% of total income tax dollars
... in contrast ...
the bottom 50% of American earners actually earn 14% of all income but pay just 3 1/2% of total income tax dollars
The bottom 50% of Americans spend a much higher percentage of their income on necessities, such as food, shelter, and clothing, than the wealthiest Americans. A fair tax system would take this into consideration. The wealthiest Americans are the ones who benefit the most from living in this country so it is only fair that they pay more taxes than everyone else. Asking the wealthiest Americans to pay 39% of their income over $373,000 to taxes is not unreasonable. Even most of the people that make this much money agree. President Obama made it clear during his campaign he was going to raise taxes on incomes over $250,000 and the majority of Americans who make this much money voted for him.
The only people who have a problem with these tax increases on people making more than $250,000 are the conservative ideologues who are adamantly opposed to tax increases of any kind. Conservative ideologues making $30k or $40k are more outraged about tax increases on people making over $250k than the people who actually pay the taxes themselves.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Why do we need a tax increase when it is a spending problem we have.
Maybe if we got spending under control everyone would pay less in taxes.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
I agree government should get rid of any wasteful or unnecessary spending, but I doubt it would be nearly enough to eliminate the deficit. There is a significant amount of money being spent on things the government has no control over, such as interest on the national debt. Right now we're paying around 300 or 400 billion dollars on national debt interest alone.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Quote:
Originally Posted by
eagle2
I WISH I was "wealthy" . I most certainly am NOT !
Wealthy people get to pay about 12 to 15 % of their income in Federal income taxes. I pay close to the top rate.
Wealthy people get all sorts of tax breaks and "welfare" for the rich. I don't.
Most, not all but MOST, wealthy people inherited some to all of what they have. I have WORKED for every nickel I have.
You're confusing two different things. I am NOT talking about the overall % of taxes paid by various income groups. I am NOT one of the 40,000 odd "rich people" Bloomberg was talking about who pay the overwhelming majority of the taxes in NYC. Wish I was.
Somewhere around 1/3 of American pay NO Federal INCOME Tax. BUT they pay payroll taxes and all sorts of regressive taxes that hit the rich and poor alike- sales taxes, gasoline taxes, utility taxes.
I also get hurt by living and working in NYC. That means I have to pay a 12.5% NYC Corporation Tax on GROSS Profits. There are NO Credits or Deductions. None .Zero. Zip. Nada. Mike Bloomberg is my 1/8 partner.
So when you add it all up, I get to keep 47 cents of every dollar I earn, NOT including sales taxes and corporate taxes that are passed down to me and every other American consumer, rich or poor.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Quote:
Originally Posted by
Paris
I'd happily pay those kinds of taxes if I was making $250K a year! Hell, I'd happily pay the 39% if I was making $100K a year.
You'll do fine and dandy so long as : You don't own a house, don't have children and don't get sick.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Quote:
Originally Posted by
Paris
Yes, I have done this. Actually, in the past if I am creeping up on the higher tax brackets, I take a vacation. Just like the dentist in the OP, I value my time and relaxation more than I value a huge bank account.
What happens if dancers stop going into work to avoid hitting a higher tax bracket? More money in the club for you!
I actually think that it is a fabulous idea that people become self regulating in regards to income caps. People will have more free time, and be under less stress. The work load will be spread around to a greater number of workers, meaning industry isn't so dependent on a vital few individuals. Less risk to industry, less stress on individuals, more opportunity to a greater variety of workers and all because a dentist decided to cut back his client list leaving an opening for new dentist to expand his/her business. Heck, this new business person can even benefit from the highly experienced staff the seasoned dentist has just cut back on!
I've always opted for more free time if the taxes were getting too expensive. I'm sure that the other dancers in the club didn't mind at all that my regulars were sitting there just waiting to spend their money on some hottie while I was taking a break.
This is the European Socialist model. It results in lower GDP and HIGHER, not lower unemployment. Why ? Because the incentives to work, save and INVEST are warped. Britain learned this lesson the hard way in the 1970's. Business after business went under and were NOT replaced by start-ups. British tax exiles multiplied. It took Maggie Thatcher and her tax cuts ( continued by Blair and the Labor Party ) to help create the "New Britain". Inter alia it resulted in an explosion of STRIP CLUBS and jobs for DANCERS. Even Denmark and Sweden eventually CUT tax rates.
The classic example of what you advocate is India from Independence through the end of the last century. The government literally stifled innovation and technological advances to try and preserve jobs. There's a famous story about Milton Friedman touring India and watching a large irrigation project under construction. ALL the work was being done by hand with picks and shovels. He
asked why they weren't using modern earth moving equipment and was told that such equipment would reduce the need for so many workers. Friedman responded : "Well then take away the shovels and hand out spoons."
India is experiencing the economic boom that it is IN SPITE of such government policies. The private sector just got fed up and went ahead with modernization WITHOUT government help.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Quote:
There is a significant amount of money being spent on things the government has no control over, such as interest on the national debt
Forgive me for calling BULL$#!T on the canard that somehow governments 'have no control' over national debt service payments. In fact such debt service payments are directly related to
- government spending levels versus tax revenues received
- gov't policies affecting international currency valuation i.e. 'printing money out of nowhere'
- gov't policies affecting price inflation i.e. the promotion of 'subprime' mortgages
Stoner is also totally correct that 'very rich' Americans have historically paid much lower overall tax rates than entrepreneurs earning high incomes. This is a 'dirty little secret' of those advocating income tax rate increases on entrepreneurs earning high incomes, while preserving (and actually increasing interest rates paid on) tax free government bonds, tax advantaged investment in select gov't subsidized industries (like alternative energy), trust laws, and other 'legal' means of tax avoidance that are readily available to the multimillionaire 'very rich' but less available to entrepreneurs earning high incomes.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Melonie,
I'm referring to interest on government debt that is already owed. Even if our government were to balance the budget tomorrow, they're still responsible for interest payments on debt that was run up in the past. Our government is contractually obligated to pay back the money it has already borrowed along with the interest promised to the lender.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Quote:
Originally Posted by
Eric Stoner
I WISH I was "wealthy" . I most certainly am NOT !
Wealthy people get to pay about 12 to 15 % of their income in Federal income taxes. I pay close to the top rate.
Wealthy people get all sorts of tax breaks and "welfare" for the rich. I don't.
Most, not all but MOST, wealthy people inherited some to all of what they have. I have WORKED for every nickel I have.
You're confusing two different things. I am NOT talking about the overall % of taxes paid by various income groups. I am NOT one of the 40,000 odd "rich people" Bloomberg was talking about who pay the overwhelming majority of the taxes in NYC. Wish I was.
Somewhere around 1/3 of American pay NO Federal INCOME Tax. BUT they pay payroll taxes and all sorts of regressive taxes that hit the rich and poor alike- sales taxes, gasoline taxes, utility taxes.
I also get hurt by living and working in NYC. That means I have to pay a 12.5% NYC Corporation Tax on GROSS Profits. There are NO Credits or Deductions. None .Zero. Zip. Nada. Mike Bloomberg is my 1/8 partner.
So when you add it all up, I get to keep 47 cents of every dollar I earn, NOT including sales taxes and corporate taxes that are passed down to me and every other American consumer, rich or poor.
The only way I can see someone paying half their income in taxes is if they're a business owner or self-employed, as you seem to fit in one of those categories. I agree that payroll taxes are high, especially for those who pay 15% because they are self-employed or own a business.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
well, just wait until Obama's latest tax increase proposal takes effect ,,,
(snip)"Mr. Obama’s own idea for raising revenues for health care — limiting the income tax deductions that the most affluent taxpayers claim — has run into opposition not only from Mr. Baucus but also from his counterpart in the House, Representative Charles B. Rangel, Democrat of New York, who is chairman of the Ways and Means Committee.
Mr. Obama’s proposed limit on deductions would raise an estimated $318 billion over 10 years, or half of his proposed “health care reserve fund.” That is a fraction of the revenues that could be raised from taxing employer-provided health benefits.
In the campaign, Mr. McCain estimated that taxing all health benefits would raise $3.6 trillion over a decade — “a multitrillion-dollar tax hike,” one Obama advertisement said.
The Congressional Budget Office says that including health benefits in taxable income could mean $246 billion in additional revenue for a single year. Stopping short of full taxation, as Mr. Baucus and others suggest, would mean less new revenue.
The latest government figures, for 2007, show that 70 percent of the 253 million people with health insurance received at least some of their coverage through employers. Employment-based insurance covers three-fifths of the population under 65. "(snip)
Depending on how this proposal actually comes down, it is likely to
A. increase tax and regulatory compliance burden on US businesses
B. significantly increase tax rates on US workers whose earnings ( which will soon also include the cash value of employer provided health insurance coverage) place them near AMT territory (i.e. $75k per year singles living in high tax states)
C. marginally increase tax rates on certain low income US workers (which will soon also have to include the cash value of employer provided health insurance coverage when calculating their gross income)
Keeping with the original point of this thread, making employer provided health care benefits part of taxable income forms a double whammy. It further lowers the theoretical amount of work effort / earnings level beyond which the effective overall tax rate becomes confiscatory. In other words, if the equivalent cash value of their HMO family coverage is $20,000, that only leaves $230 in 'regular' income before confiscatory tax rates will kick in (at the $250k combined gross income level which the gov't now deems to make one 'rich').
But it also further widens the moral hazard 'gap' between the overall standard of living of unemployed Americans that are fully eligible for social welfare benefits (including medicaid) versus the overall standard of living achievable by working full time at an unskilled or semi-skilled job that includes some measure of employer provided health benefits (and paying all pertinent taxes).
Based on campaign positions and Washington scuttlebut, the most probable way this change will come down is to include an offsetting 'health insurance' tax credit as part of the package ... which will cancel out the taxability of employer provided health care benefits for workers earning below the $75k per year level at which the AMT will start to kick in, and will make the cash value of employer health insurance benefits fully taxable for those whose earnings place them well into AMT territory i.e. $150k per year income level.
Re: 'When Taxes Penalize People Making Money, Money-Making People Cut Back"
Quote:
Originally Posted by
eagle2
The only way I can see someone paying half their income in taxes is if they're a business owner or self-employed, as you seem to fit in one of those categories. I agree that payroll taxes are high, especially for those who pay 15% because they are self-employed or own a business.
Ding ... ding... ding.... ding. BINGO !
Not only am I a business owner but I am also an EMPLOYER who pays wages and provides benefits including Health Insurance !