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opinions of income tax

Discussion in 'Politics, Elections & Legislation' started by mrskeet410, Apr 14, 2010.

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  1. mrskeet410

    mrskeet410 TS Member

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    Is there a connection?

    47% do not pay any income tax.

    45% say the amount they pay is "about right."
     
  2. timb99

    timb99 Well-Known Member

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    Its a difficult question.

    On the one hand, the "so-called-rich" pay the vast majority of all income taxes paid. I think if you look at the statistics, the top 10% income makers pay 71% of all the income taxes.

    But income taxes aren't the whole story. As you know, everyone who gets a wage, pays social security and medicare, to the tune of about 7.65% of their income. Plus, most everyone pays some sort of sales tax, gasoline tax, and if you own property, you pay property tax.

    People with a LOT of investment assets also pay capital gains tax, but capital gains are taxed at a moderate rate.

    So what you have is this:

    Even though the "rich" pay a large portion of the INCOME tax collected, the claimed disparity is that as a percentage of their income, they pay a lower percentage OF OVERALL TAXES than some folks who make a LOT less money than they do.

    Case-in-point.

    A very, very rich family has a $500 million income, but only a small portion is "wages" and the rest is capital gains on investments. If you count income tax, sales tax, property tax, social security, and medicare taxes, maybe they pay $100 million in taxes, but its only 20% of their overall "income."

    A middle-income single guy has a $70,000 income, mostly wages, doesn't own his home so he can't get a mortgage deduction. If you count income tax, sales tax, property tax on his car, social security, and medicare taxes, he only pays $23,000 in overall taxes, but its 33% of his overall income.

    Hence, the argument that there's a disparity.
     
  3. timb99

    timb99 Well-Known Member

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    http://www.nytimes.com/2010/04/14/business/economy/14leonhardt.html?hp

    Article on the subject.
     
  4. Recoil Sissy

    Recoil Sissy Well-Known Member

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    timb99:

    Your post may be loaded with accurate data and profound conclusions but I'm having trouble finding them.

    For starters, the following is a list of "Who Pays Income Taxes and how much" for tax year 2007 - the most recent comprehensive IRS data available:

    The top 1% of income earners (minimum income to qualify: $410,000) paid 40.42% of all income tax paid.

    The top 5% (minimum income to qualify: $160,000) paid 60.63%.

    The top 10% (minimum income to qualify: $113,000) paid 71.22

    In 2007 your $70K single guy example would have been in the top 25% of all income earners. More specifically he would have fallen in the group below the top 10% and above the cut off for the top 25%.

    As a group those folks picked up 15.37% of the total income tax tab. He may be your idea of "middle income" but he is in fact, top quartile.

    In describing this guy you mentioned among other things sales taxes, property taxes on his car, and the lack of a mortgage deduction. Those items are of course, at least potentially part of his overall tax burden but I'm not sure why or how they're germaine. None of them fund the federal treasury.

    Sales taxes are predominantly state and local in nature. Property taxes (on real estate) typically fund political subdivisions like counties, townships, and municipalities. Those tax revenues in turn fund LOCAL services such as public schools, libraries, as well as police, fire, and ambulance protection.

    You also cited a "very, very rich family... (with a) $500 million income with a hypothetical tax burden of 20%. As a hypothetical that may or may not be accurate.

    According to Forbes magazine it took a mere $950,000,000 in TOTAL ASSETS in 2009 to make the list of the wealthiest 400 Americans. Taxes are levied on individuals and other legal entities like corporations. For purposes of discussing taxes, an extended family's income is meaningless. We might as well discuss the collective incomes of your gun club's membership. Interesting perhaps but relevant how?

    What makes you (and the NY Times) think the same high income people who pay the vast majority of the freight on federal programs don't fund a disproportionately high amount of state and local programs as well?

    sissy
     
  5. timb99

    timb99 Well-Known Member

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    Sissy

    I didn't draw any conclusions other than to say "here's why some folks think there is a 'fairness disparity' in individuals 'tax burden'."

    And I was going from memory on the percentages. I've fixed that.
     
  6. Chichay

    Chichay TS Supporters TS Supporters

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    When we go grocery shopping, the cashier does not ask us how much we earn with the idea of charging us according to our ability to pay. If she did, I wonder how many at this site would patronize such a store. My point is that most of us, if we were asked to pay more for the same item than the next guy (even when we can afford it), would not want that done to us, yet we advocate that it be done to somebody else.
     
  7. wolfram

    wolfram Well-Known Member

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    The reality of life it that it isn't fair and not suprisingly neither are our taxes.

    I get your point on dispairity Tim and that is pretty much the way it has seemed for me for the 25 years or so.
     
  8. bigdogtx

    bigdogtx Well-Known Member

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    maybe if the money wasn't WASTED, we wouldn't hate it so much,,,,but a tunnel for salamanders in mating season; for a turtle crossing; to study the smell of pigs, etc....
     
  9. timb99

    timb99 Well-Known Member

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    Here's a pie chart of how your federal tax dollars get spent. If you want to get angry about something, the salamanders are the least of your worries.
    PolicyBasic_WhereOurTaxDollarsGo-f1_rev4-14-10.jpg
     
  10. Recoil Sissy

    Recoil Sissy Well-Known Member

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    timb99:

    Your observation, "If you want to get angry about something, the salamanders are the least of your worries" is spot on.

    Following are the first few paragraphs of a Washington Post article dated April 19, 2009. Google 'Murtha's airport' to read it all.

    The article chronicles a fairly typical example of pork barrel spending that no doubt appeared as Transportation Infrastructure and Defense and Security spending on the pie chart. In reality Murtha's airport represents several hundred million dollars of federal pork that fails to pass the 'straight face' test for responsible spending.

    Where on the pie chart another several hundred million in subsidies to Acorn appears escapes me but I digress...

    ------------



    Murtha's Earmarks Keep Airport Aloft
    State-of-the-Art Pennsylvania Facility Sees Few Travelers but Lots of Funding

    By Carol D. Leonnig
    Washington Post Staff Writer
    Sunday, April 19, 2009

    JOHNSTOWN, Pa. -- The John Murtha airport sits on a windy mountain two hours east of Pittsburgh, a 650-acre expanse of smooth tarmac, spacious buildings, a helicopter hangar and a National Guard training center.

    Inside the terminal on a recent weekday, four passengers lined up to board a flight, outnumbered by seven security staff members and supervisors, all suited up in gloves and uniforms to screen six pieces of luggage. For three hours that day, no commercial or private planes took off or landed. Three commercial flights leave the airport on weekdays, all bound for Dulles International Airport.

    The key to the airport's gleaming facilities -- and, indeed, its continued existence -- is $200 million in federal funds in the past decade and the powerful patron who steered most of that money here. Rep. John P. Murtha (D-Pa.) is credited with securing at least $150 million for the airport. It was among the first in the country to win funding from this year's stimulus package: $800,000 to repave a backup runway.

    The facility, newly renamed the John Murtha Johnstown-Cambria County Airport, is a testament to Murtha's ability to tap streams of federal money for pricey, state-of-the-art projects that are rare among regional airports of comparable size.

    ---------

    Examples like this are egregious and endemic but are trivial in the grand scheme of wasteful and corrupt federal spending.
     
  11. bigdogtx

    bigdogtx Well-Known Member

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    well timb99, the salamander example of top of mind and was just an example of the audaciousness of the stupidity of congress,,,,for you I linked 50 more for you for last year,,,,this does not take into account the last 50 years of similar spending,,,,btw, what are "safety net programs" that are 14% of the budget,,,,

    This is also very telling as SS and Medicare, Medicaid and CHIP,,,,are included in your chart, yet don't they have their own input by way of "seperate" taxation????
     
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