Happy Tax Day!
Taxes are one of the most politicized and misunderstood parts of our country. Both parties and the media are awash in tall tales and myths about taxes, so here are some little known but absolutely true facts to help clear things up:
- Fox News says “47 percent of Americans don’t pay any taxes”. McCain and Palin said the same thing during the 2008 campaign. Bush’s spokesperson said “50 percent of the country gets benefits without paying for them”. Nonsense. The poor pay a higher percentage of their income for taxes than anyone. They may pay less in federal income taxes, but they pay more in payroll (Social Security) taxes, state and local taxes, gas tax, sales tax, utility taxes, etc.
- Rand Paul says “the wealthy do pay most of the taxes in this country” claiming that the rich pay 38% of taxes. But again, he is including only federal income taxes, which is one-fifth of the taxes we pay. Our other major federal tax, payroll taxes, are capped at $106,800 of income, and so are actually regressive taxes where the poor pay a significantly higher share.
- The federal income tax rate on the richest Americans may be 38%, but that doesn’t take into account tax shelters and loopholes that let the rich avoid paying taxes. The richest Americans actually have a lower effective tax rate (17%) than the middle class and even the poor (22.5%). And many of the richest pay no income taxes at all, like hedge-fund manager John Paulson, who made $9 billion in two years but paid zero in taxes on it. In more than one year Donald Trump has paid zero in federal income taxes.
- The same thing is true of corporate taxes. The next time you hear someone claim that corporations pay higher taxes in the US than in other countries, remind them that while the official tax rate is higher, all those loopholes and tax shelters allow many corporations to pay zero in US taxes. The majority of multinational corporations pay no US taxes. Just recently, GE not only didn’t pay any federal taxes, we gave them money.
- Republicans claim to hate taxes, but it looks like they love taxes on anyone except the rich. Reagan signed into law 11 tax increases against the poor and middle class, but called them “revenue enhancers”. Bush Sr. broke his ironclad promise to never raise taxes on anyone by raising taxes on children (seriously). Just four months ago, Republicans raised taxes on the least rich one-third of Americans by repealing Obama’s “Making Work Pay Credit” while at the same time demanding that tax cuts for the rich be extended. They also changed Social Security taxes, raising them for the poorest Americans while lowering them for the richest.
UPDATE: Michele Bachmann repeated the claim that the top 1% pay 40% of all federal taxes; PolitiFact rated her statement False for the same reasons given above.
6 Comments
Nice list!
Other fun things to do when debating “TAXED ENOUGH ALREADY” partiers about this nonsense:
1. When they tell you what astronomical percentage of taxes the wealthy pay, ask them what percentage of income they took in. Whining because the rich paid 38% of all income tax has no perspective. What if they made 38% of the income? Most people have no real understanding of how much income and wealth the top earners have accumulated. The real numbers are astonishing.
2. One of my pet favorites, ask them how they feel about someone who skips out on paying taxes. This is a really interesting situation because on the one hand, they consider the tax rates to be confiscatory and often unconstitutional. At the same time, they somehow feel that it is immoral to not pay your taxes.
This becomes increasingly absurd when the discussion shifts to all the people who “don’t pay taxes.” Is that a good thing or a bad thing? How can it be a bad thing that the government require you to pay some amount of taxes, and also bad that you don’t pay those taxes?
Didn’t the top 1% make around 45% of all the income? I remember reading it but don’t recall the actual number. Anyone know for sure?
Please don’t make me panic like that. I just checked, again. Taxes this year are due on April 18 (some states may have state taxes due today).
I was working on mine last night, migraine and all, when my husband spotted that we’re in a state that has the state taxes due on April 18. I’m finishing them this weekend.
(And yes, I do them the old fashioned way: calculator and pencil.)
Federal tax returns are due Monday the 18th due to Emancipation Day falling tomorrow, making today the D.C. holiday, pushing tax day to Monday. đŸ˜€
Glenn Beck mentioned that the top wage earners pay 70% of the tax revenue in the U.S. Unfortunately, he failed to point out that the same group makes nearly 50% of the money. It’s interesting how tax statistics can be manipulated and used to make just about any point you want.
Why does no one ever mention all the celebrities — musicians, Hollywood actors, and athletes — who are hiding money in overseas accounts and setting up shell companies to hide their royalties while pretending to be all for this redistribution of wealth! They’re a bunch of hypocrites. All the wealthy people, including the fast talking celebrities, hide their money while the middle class does not have that advantage nor does the middle class make that much money. If the wealthy want to hide their money somewhere, let them go live and work in that country also. They want to suck all the money from the US and its citizens, just as corporations want to do, and then not give anything in return. That’s not to say that our government hasn’t betrayed us by giving billions in aid to every country on the planet while our government is trillions in debt! Ridiculous! And allowing mass imports to flood our country while losing all our own jobs! And importing cheap, illegal labor at the same time. What does anyone expect is going to happen to the middle class and this country? It will become a third world country like all those foreigners it keeps importing and giving them special privileges and special loans, etc. Crazy!
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