Published: Tuesday, April 16 2013 8:45 a.m. MDT
47% of American are quite content with the income tax rates. They pay none.THe unhappy folks are the rest of us, who work, and pay taxes instead of
getting all sorts of insane "refundable credits" where people with
little income, or a lot of fraud, get far more cash back than they paid in.
And yet most Americans have the lowest tax rates of their lifetime right now.
What that tells you is that the narrative moves opinion more than reality does.
Why are we so ready to beat up on poor people? They work just as hard as anyone
else, often harder, they just don't make as much money as the rest of us.
As regards taxes, when you consider total taxes(federal, state, and local) paid
by income level, the top 20% of income earners pay 7.5% of their income in
taxes, the bottom 20% pay 11.1% of their income in taxes. The second, third,
and fourth quintiles from the bottom pay at 10%, 9.4% and 8.7% respectively.
Perhaps we should be thinking more about camels and needles and less about
belittling the 47%ers.
We have the highest corporate tax rate in the developed world. Which hurts our
competitiveness, and drives money out of the country. As well as hurting
shareholders, most of which are people with 401Ks and IRAs. The cost of
regulation is staggering and skyrocketing. You can't look just at marginal
individual rates. That's only a small part of the picture.And
DN Subscriber 2 is right. I do income taxes for a living. Many people know
exactly how much they need to make to maximize their EIC. When 47% pay nothing,
and a significant portion of those get back thousands they themselves never paid
in, something is not right with this picture. We'd call it theft of one of
those tax receivers took the money directly from one of the taxpayers - yet when
the government does it for them legally that's supposed to make it all
Anyone want to go back to the rates under Reagan?
I received a 3% raise in 2013 but my take home pay is 2% less than it was in
2012 due to increased taxes and health care premiums. Thank you Obama!
Dear Thomas Jefferson,You might want to google "Total tax
burden" and check some facts before you accuse someone of making them up.
I also do income taxes for a living and have done so for 42 years. I am
well into the top 20% and don't mind paying my share. In those 42 years I
have witnessed much more tax cheating by the top 20% than by the bottom.BTW, since Reagan started cutting top marginal rates the share of total US
wealth owned by the top quintile has gone from 85% to 93%. If you want to know
why the middle class is shrinking, at lease consider the tax structure.
viejogeezer - can you explain how with the top bracket tax rate of 39% the top
20% manage to get away with only 7.5% taxes? I really could use your advice,
because I am in that bracket, and I end up with an experience similar to that of
Thomas Jefferson in spite of all the deductions and credits for supporting a
wife and eight children, and my fair share in charitable contributions of a
faithful Latter-Day Saint.
To "JoeBlow" I would love to go back to the Reagan tax rates, as long as
we go back to the same size of government, regulation, and tax laws that were in
place during that period of time.
Lots of disinformation posted above. Reagan's taxes were higher than they
are today. General Electric is part of the %47 percent who does not pay taxes.
We may have the highest NOMINAL tax rate for businesses, but what our businesses
actual end up paying after using the loopholes their political lobbying is of
the lowest amount in business tax around the world. You tax guys that are paying
%40 percent of your earnings in taxes should hire a better tax guy!
Sasha, the 35% bracket starts at $388k taxable income. If you have 8 kids and
pay tithing you need to be making $500k. If you can't buy groceries with
$500k income you need a budget. Income breakpoint for the top 10% of taxpayers
is $112K adjusted gross income. With 8 kids, tithing, and an average mortgage
that leaves 33k in taxable and 4K in tax. That's 4%. Dividends and
capital gains are taxed at 15%. Can you see how Warren Buffet complained that
he paid at a higher rate than his secretary?
Suppose most of your income is W-2 salary + employee stock. After you've
taken deductions for dependents, and charitable contributions, assuming your
goal is to simply put the extra money somewhere safe so you can use it when you
need it, how do you avoid 39% tax? 401(k) does not cut it - you get taxed when
you take the money out, plus there is early withdrawal penalty. I do not want to
make risky investments. I cannot write anything off as an expense - I do not
have any except feeding the kids. I am stuck with 39% unless I do something
wild. I also wonder how my "fair share" becomes a magnitude higher
when I focus on improving my skills and finding a better employment. This is
fundamentally wrong - if I choose to be lazy I have to pay much less. So if
China or Russia wanted to bring us down they could just secretly pay people to
be bums - forget espionage! To make it more fair we need a reasonable minimum
and maximum tax with exceptions for the disabled, and have the option to pay it
in labor or in cash.
@RedHard to quantify "regulation and tax laws" to compare.
I have no doubt that regs have increases.I can quantify the
"size of government" though.According to the US OPM (office
of personnel management) - easily to GoogleReagan 1981 - 2,806,000
nonmilitary federal employeesReagan 1989 - 3,064,000 nonmilitary federal
employeesThat is an INCREASE of 258,000.Under Obama,
there are 2,756,000 non military federal employees (as of 2011)Keep
in mind that the population is almost 70 million people higher now.source - OPM dot GOV
Please don't use a brief comment to dismiss an entire school of thought.
Our entire tax code is in need of a serious overhaul. Yes, corporate rates
ought to be lowered to be competitive with the rest of the developed world. And
any discussion of that premise (as opposed to my brief mention above) also
includes the need to simplify the whole code and get rid of corporate welfare.
90% of economic activity in this country is at least partly based on
how it will affect one's tax position - as opposed to best fulfilling an
actual need. From buying online to avoid sales tax, to crossing a state border
to pay lower sales tax, to locating in a particular state based on the local tax
burden, to corporations lobbying to worsen others tax positions and enhance
their own.We currently spend 5.4 billion hours every year to comply
with over 2500 pages of tax code. Even the IRS itself doesn't understand
the code - up to 20% of the answers given to taxpayers trying to comply are
My secretary who voted for Obama, got a tax increase.....needless to say she has
finally seen the light and realizes that Obama/Biden lied when they said tax
increases would only affect those who incomes were $250k+....
"My secretary who voted for Obama, got a tax increase."Disingenuous at best.Her taxes went down, and then they went back
up. In reality, she got a tax break for a couple of years. You call that an
increase?Keep in mind that in both instances, they were supported by
We had multi trillion dollar wars....not free.
Schwa: Taxes have steadily increased since Reagan left office. That means
they are the highest right now since I've been paying them.Joe
Blow: The lowest tax rates in my lifetime were under Reagan, so your snarky
comment is baseless. They steadily decreased during his 8 years in office. Do
Amazing how people can be hurt, and not realize where it came from.Many weren't even born when Reagan was president, and are misinformed.Hmm? How much taxes did we pay during Lincoln's presidency?Mark my words,--Obama will run our economy dry, and many will blame
passed presidents, or sequestration. Sad.Who created sequester?
"The lowest tax rates in my lifetime were under Reagan, so your snarky
comment is baseless. They steadily decreased during his 8 years in office. Do
some research."Maybe a technicality. I assure you, I do
research what I post.Under Reagan, the lowest top tax rate was
generally 50%, but did dip down to 28% briefly.So, technically, that rate
is lower than today. If that is your only criteria, then you are correct.However, look at the brackets. The top rate kicked in around $35K in
today's dollars.Additionally, Reagan raised the tax on Long Term Cap
gains to 28%.Our top tax rate today is 39.6% Yes, much higher than
Reagans 28%.But, it kicks in at earnings of $388,000.There is
no way the GOP would allow Reagan's tax rates and brackets today. My "snarky" comment was far from "baseless". Do some
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