Since there are so many politcos on here, does anyone have handy studies that show the percentage of Americans that effectively pay no income taxes after tax credits and deductions?
Ok, that linked a CBO PDF, thanks (having a discussion during work).
This should also help:
The comic is cute, but the irony (that is briefly mentioned in the article) is that the poor often pay more as a percentage of their income due to less-sexy taxes that don’t get media attention, not to mention hidden stuff like inflation. Depending on your ideology, you can take that information and go try to soak the rich some more, ignore it, or try to comprehensively reform the system that funds the beast.
It’s not really an issue of it being fair or not, it’s the socio-political consequences of 2/5 (or more) of the taxpaying electorate being “divorced” from the consequences of tax laws. IE, Rome, bread, circuses.
… as well as, according to the CBO document, the top 1/5 carrying 2/3 the tax liability.
Nah, the bigger issue is less-well-known tax subtleties making average Joes divorced from the knowledge of tax laws. But that battle is long dead now.
… well, this is all in the context of the current stimulus package. The idea that we’ve hit a point in our country that the majority of taxpayers no longer contribute meaningfully to the tax funds means that there is little political pressure for fiscal responsibility, and now, after 8 years of profligacy under Bush, and the House/Senate Democrats with a decade’s worth of policy grudges to make good and with a financial disaster not of their own making to fully exploit, there are no longer enough votes to stop it.
IRS data has the top 25% paying 86%, top half pay 96.7%. That’s income tax as excise/payroll are more regressive.
The bottom income group usually has a negative income tax rate due to tax rebates.
Edit note; Top 25% pay 86% not 88%.
You left out “the top 1/5 make almost 2/3rds of the money”; taxation isn’t a head tax. Glancing at the CBO document, the top 20% of earners make a whopping 14 times what the bottom 20% does.
If you transpose a wealth distribution chart over a tax liability chart you’ll find that this situation actually makes sense.
Too bad, so sad. There is probably a parable here that Republicans should’ve paid more attention to for the last 8 years.
Also, you are furthering the disconnect about taxes by failing to tell the entire story. Thanks for increasing ignorance around your workplace! (Hint: it sucks for everyone.)
Top 25% makes 67%. Who cares about the disparity between top and bottom? The top will have more earners, more joint filers and probably less retirees. You can’t make a snap comparison without some major demographic adjustments.
I wouldn’t say it makes sense as the rich while paying more ‘total’ tax still pay less as a percentage of income and even less still as a percentage of wealth. This is why inequality gets worse and worse.
Well there is rich and there is rich. The top 20 or 25% are not the same as the top 0.01%.
First, these are not necessarily my arguments. Second, could you elaborate (in brief)?.
You should read the factcheck piece, they talk about the CBO analysis that explains it.
http://www.factcheck.org/askfactcheck/do_40_percent_of_americans_pay_no.html
As brief and clear as anyone on this board could write.
Well, sure, that’s my position - that lower income payrolled workers care more about weekly take-home pay than their total yearly tax burden, but they certainly perceive their relative tax rate (even if they don’t understand how their refund check reduces their effective rate).
But “fairness” isn’t what this question is about; it’s the long term political consequences of that inequality (with the implicit idea that these massive bailouts is one emerging effect of them). Rather then asking “is it right that the top 1/4 possess 66% of the wealth?”, it’s asking what are the political consequences w/re to public policy of a minority possessing the majority of the wealth, and a large voting minority almost divorced from participating in the economic sphere (essentially a institutional, and growing, liability)?
The only logical consequence is:
The bet, clearly, is that the cooperate sponsored media will placate the masses so the rich can avoid all of the mess.
The bank bailouts aren’t happening because we have an elite with concentrated wealth; they’re happening because the economic system will collapse if the banks and the like go down. How we got here and the resistance to nationalizing the damn things is due to the cultural and lobbying influence of those huge deregulated corporations and the rich, though, which is related.
The bottom 20% having no money is nothing new, though, I’m not sure what you mean.