Published: Monday, April 15 2013 12:00 a.m. MDT
"The report said the United States has the most progressive tax burden of
any industrialized nation."That may well be true, but the U.S.
also has, by far, the most unequal distribution of wealth of any industrialized
nation. You also leave out the fact that since 1983, working Americans have been
paying significantly higher payroll tax rates, and that the government has been
borrowing these excess payroll taxes to pay for functions that would normally
have been covered by income taxes. Also, the percentage of Americans paying no
income tax is quite close to what it was back in the 1940's. There are many ways to frame an argument. To get a true picture you need to
include all of the details.
The Tax Foundation is funded by big oil and the Koch Brothers. As a seasoned
tax prfessional, I do not trust anythig they write. It figures that the DN would
feature their "report" ( which is really a series of charts) rather than
reports by Tax Analysts and others.
"Of interest as well today should be a report from the Tax Foundation,
released late last week. It provides a detailed breakdown of federal income
taxes in terms of who pays and what, if any, inequalities exist. The results may
surprise many Americans." Where did they get their data? Did the IRS
provide data dumps on all filers, or did the IRS sample filings for the Tax
Foundation, or did the Tax Foundation perform their own sample survey. Before
you parrot this stuff you should do a little checking.
Many corporate leaders have noted that other OECD countries have lowered their
corporate tax rates in recent years, but fail to mention that these countries
have also closed corporate tax loopholes while the U.S. has expanded them. As a
result, the U.S. collects less corporate taxes as a share of GDP than all but
one ofthe 26 OECD countries for which data are available. In
1965, U.S. corporate income taxes were 4.0 percent of our GDP, compared to 2.3
percent of GDP in other OECD countries. But by 2009, U.S.
corporate taxes had fallen to only 1.3 percent of our GDP, while corporate
income taxes of the other OECD nations collectively stood at 2.4 percent. Many countries experienced unusually low corporate tax receipts in
the last couple years due to the recession. But even when U.S. corporate taxes
recently peaked in 2007 at 3.2 percent of GDP, the average for the other OECD
nations was well ahead, at 3.8 percent of GDP. In 2009, only
Iceland had lower corporate taxes as a share of GDP than the U.S.-Citizins for
Most of Utahans are disconnected from funding the government. Large families
many deductions. It is the Utah culture. Utah is ranked in the top 5 of states
with the fewest federal income tax payers.Editorial board "pot
meet keetle" start stating that Utahans and Mormons need to stop bashing
taxes and start paying so they fund their large families which are a drain on
our education systems and health care.
@ Mark. Comparing taxes to GNP is meaningless. Who cares what taxes compared to
the GNP might be? We still have the highest corporate taxes in the world and the
GNP doesn't reduce or change these taxes on penny. They still must be paid
and because they are the highest in the world, corporations and jobs leave and
go overseas where they can survive regardless of any country's GNP. Its all
about competition in the world market place and high taxes makes it impossible
to compete with countries that have lower taxes even if that country has a lower
GNP. Taxes are still taxes and the GNP affects them not a bit!
The simple fact is that high tax rates reduce business expansion and reduced
business expansion reduces revenues to the government. High tax rates create a
revenue death spiral. More businesses export jobs to offshore companies.
Exported jobs mean fewer Americana are working. Fewer workers mean less payroll
taxes are paid to the treasury. High tax rates mean more welfare checks are
paid from the treasury.The greatest disservice the government can do
is to take money from the public that is needed by the public to create tax
paying jobs.Yes, the wealthy should pay taxes, but they should pay
the same RATE as the poor. Government services, at least those authorized by
the Constitution, benefit all Americans equally. All Americans should at least
pay the same rate. Paying the same rate still shifts the burden
disproportionately onto the wealthy.
People need to understand the difference between tax rates and EFFECTIVE tax
rates.I am all for closing ALL Corporate loopholes and lowering tax
rates.When you compare the actual tax rates that corporations pay to
what they pay in other countries, you get a much truer picture.Remember all the carping about GE paying ZERO corporate taxes?Additionally, many people like to only tell part of the story. Many countries
that have a lower corporate tax rate than ours, have a significantly higher
personal income tax rate.
Short memory Mike,Can you imagine when you were picking and choosing
which bills you would pay, if you lost all of your 9 deductions and had to pay
10-20 % of your income to state and federal taxes?Would you have
@ Joe Blow. You are right that GE pays no corporate taxes, but they sure donated
handsomely to Obama's two elections! They get huge tax breaks because
supposedly, GE is doing research on green energy and receive generous tax breaks
provided by the Obama administration. Indecently, GE has produced nothing in the
green energy arena but they have moved thousands of jobs to China. If we close
that "corporate loop hole" what would Obama do? Corporate loop holes are
not created equally!
I am amazed the Editorial Board elects to write an article about the
exploitation of the wealthy. In the United States we have 35% of world's
billionaires, 30% of the world's millionaires with less than 5% of the
world's population. If that isn't enough Warren Buffet has even
recently asserted with all his tax breaks and loopholes he believe his secretary
still pays a higher tax rate. by the way the Tax Foundation, a pro business
funded organization. is hardly objective in these matters.
I do agree that the rich should pay as much as the poor and middle class.I am clearly middle class yet I pay 19% in taxes. Now a rich person
will pay less than 10% in taxes.Since I pay a larger percentage of
my wages in taxes than the rich, their taxes need to be increased. Warren
Buffet has been saying the same thing. Why are people against the rich paying
the same rate as the middle class?Putting them at the same rate will
increase tax revenues by $150 Billion a year or $1.5 Trillion in 10 years. I
say raise their rate to the same as the middle class and apply it straight to
debt and deficit reduction.The same tax rate needs to be applied to
those with large families. No more child tax credits. Leave the EIC in place
to help those that are well below the poverty line (Max of 2,000 per year
received in EIC).This will help to cut the debt, reduce the trade
deficit and encourage further savings as people will be forced to live within
their means and not on government handouts.
@ Joe Blow,I was self-employed (and I still am self-employed) when
my children were at home. There is no deduction on Schedule C for the number of
children. There is no deduction on Schedule C for anything related to family or
charity. Believe me when I tell you that I paid my share of taxes, including
the 100% "donation" to Social Security. Believe me when I tell you that
I am still paying off loans that I had to take out more than a decade ago to pay
the taxes that government demanded. Believe me when I tell you that paying off
that loan has kept me from hiring people to help in my business.Believe me now when I tell you that those children all pay taxes now.Believe me now when I tell you that one of my sons is writing out a check
TODAY to the government to cover the difference between what was withheld and
what he owes - a check that is greater than my total income for 2012. Looking short sightedly at deductions gives false impressions. Children grow
up and become tax-paying citizens.
"As the Reuters news agency put it, this was 'a sign that tax hikes
early this year stole momentum from the economy.'""The
much-publicized bottom 99 percent of taxpayers now pays on average less than 10
percent in income taxes, which is the lowest level since before the 1986 Tax
Reform Act was passed. The report raises questions about the wisdom of so many
Americans being disconnected from the primary means of funding
government."So which way is the DN arguing? Are tax hikes
impeding economic momentum, or are the bottom 99% not being taxed enough?
Sounds like you're trying to have it both ways.A Citizens for
Tax Reform report states that taking all income, payroll, and other taxes (sales
tax, gas, alcohol, etc) together, the bottom 20% of taxpayers pay 17.4% of their
income in total taxes, and the top 20% pays 30% of their income in total taxes.
Personally, I don't find that a progressive enough system.
@Mike RichardsSchedule C flows into a the regular Form1040 where
exemptions for children and deductions for charitable contributions offset the
business income from Schedule C. To imply that you were not receiving credit
for your children or charitable deductions against your business income is
ignorant or dishonest.
The real issue lies in understanding the huge gap between the "nominal
rate" (the list price) and the "real rate" (the tax rate that most
companies actually pay.) These two rates diverge widely. The nominal federal tax
rate on the largest corporations is now 35 percent. State taxes, on average,
bump this to 39.2 percent. This nominal rate ranks as the highest among
developed countries.However, no major company really pays the
nominal rate. . . Big companies enjoy a huge buffet of credits, shelters,
deductions, and other preferences that reduce their rate to an average of 13
percent. Many profitable companies pay no federal income tax at all. Regardless
of our nominal rate, OUR REAL CORPORATE TAX RATE IS AMONG THE LOWEST. Further
cuts cannot stimulate growth. -The Truth About Corporate Tax Rates, By David
Brodwin | April 4, 2012, US News and World ReportYou guys do
understand the difference between nominal tax rates and effective tax rates
Every year the IRS releases tax data on the 400 wealthiest households. These 400
households have an average annual income of 300 million dollars, and a pay an
average tax rate of 16.6%. That's not overtaxed. Also, Seven of these
households were among Romney's 47% who paid zero income taxes.
By showing about 1/3 of the tax picture, this very poorly constructed DN
editorial is both inaccurate and misleading. Yes, if you look at the aggregate,
the wealthy in America may pay a larger percentage of income taxes than the
wealthy in other countries. But in spite of this, somehow the wealthy keep
accumulating a larger piece of a pretty slowly growing pie. Even Republicans
don't dispute all the studies showing that inequality in America is growing
rapidly. The reason the wealthy pay the lion's share of the income taxes is
because they earn a massive and growing chunk of the income and their portion of
overall wealth is expanding exponentially. Our problem is not a progressive tax
code. Our problem is the initial distribution of wealth. The bulk goes to the
top few. The rest are getting less each year.But if you want to talk
about progressive tax codes, Germany's is far more progressive, especially
if you count several taxes they pay that we don't. Their wealthy probably
pay a lower percentage of the whole because they earn a lower percentage of the
income. Silly, biased editorial.
@TaxMan,You've really shown your ignorance of tax laws.
Schedule C shows the profit/loss of a business. Schedule C requires that you
pay self-employment tax on the profits earned from that business. Because you
pay Social Security taxes on the profits of a business BEFORE deducting
exemptions and donations, you pay the FULL 15% required for Social Security
BEFORE deducting exemptions for children and BEFORE deducting donations to
charity.That 15% is on top of the income taxes owed. That 15% is on top of property taxes owed.That 15% is on top of
any other taxes owed.If you owned a business, you would know that
having Uncle Sam as a silent partner keeps you from hiring real people who would
produce goods and services; people who would pay taxes instead of receiving
welfare from Uncle Sam.If you owned a business you would know how
insidious high tax rates are and how crippling it is to have Uncle Sam as a
silent partner in every business; a partner who drains off the profits that
could generate more revenue to the government if left to the owner to use to
build his business.
@Mountanman"You are right that GE pays no corporate taxes, but
they sure donated handsomely to Obama's two elections!"No
argument there. I am for getting ALL corporate and union money out of the
elections as I believe that they corrupt the system and sway legislation. And
get rid of all lobbying also.Are you for that? I see George Soros
and the Koch brothers as being the same, just on different sides of the
political fence. Their money corrupts equally.Do you think that
Republicans are immune to being bought by corporations?
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