Taxed Enough Already
April 15th is a great time to consider our broken and fatally flawed tax system.
Right now, America
The top 1% of income earners (families AND small businesses earning $410,000/year or more) pay 40% of all income taxes. The 10% of income earners (families AND small businesses earning $113,000/year or more) pay 71% of all income taxes, while 47% of Americans pay NO income taxes at all.
Given that the top 10% of income earners earn app. 43% of the aggregate annual income (they provide over 50% of the productive output in the country), it would seem that they are grossly over-taxed...by somewhere around 25% to 30%!
The bottom 90% of income earners, where the rest of that 57% of the aggregate annual income is found and upon which less than 29% of all income taxes are received, seem to be grossly UNDER-taxed, especially relative to productivity.
Ironically enough the truly “rich” don’t factor into any of this at all.
The truly “rich” don’t rely upon income for wealth.
So, the productive “rich,” those who earn the highest incomes are NOT at all “under-taxed,” as most of the pseudo-elitists claim, they are, in fact, over-taxed, it’s the bottom 80% to 90% and especially the bottom 50% of American income earners.
Think about all THAT as you ponder the 2010 tax deadline.
Well, the elite in Washington take care of themselves and their friends (the rich), and try to be subtle about screwing the people who vote for them (the folks who pay no income tax overtly, but who get screwed behind the scenes). That leaves the middle class to get screwed overtly, but they know the middle class will never rise up and do something effective about it.
ReplyDeleteAnswer (to everyone BUT the elite who'll lose their power to control others, while abusing the system they've imposed, like Charlie "can't add squat" Rangel, Tom Daschle, Timothy Geithner, etc): the FAIR Tax. Scrap the "progressive" system, and go FAIR Tax.
ReplyDeleteAs for the VAT Tax: anyone who votes for it, goes the way of the dodo bird at the polls in November.
"That leaves the middle class to get screwed overtly, but they know the middle class will never rise up and do something effective about it." (EL)
ReplyDeleteLargely right, EXCEPT that that's ONLY because, to date, the middle class has perceived personal benefit from many government programs (ie. Social Security, Medicare, even Medicaid and AFDC, etc.).
As that perception erods, so does government support.
As tax rates rise, more people begin having a problem with government.
One example is the proposed VAT and the "Carbon" ot "Energy tax."
Those are directly aimed at the bottom 50% of income earners.
The VAT will be proposed with massive reductions in both the Corporate and personal income tax rates.
The VAT is NOT a "National Retail Sales Tax" (like the Fair Tax), it's a production tax levied at EVERY level of production, with a HUGE "multiplier effect" by the time it reaches the consumer at the retail level.
The VAT will be a direct tax rate hike on the poorest to be able to offer a large reduction on the income tax....which the "highest earning" 10% (NOT "the richest 10%) of Americans pay 71%.....the VAT will take a LOT more from that bottom 50% of income earners, where appx. 56% of the annual aggregate income comes from.
The "energy tax," would also deliver a disproportionate negative impact on low-income earners. ESPECIALLY those lower-income workers who must travel to work.
Tax policy is going to be (rightly or wrongly) politicized by an opportunistic GOP....and that will almost certainly be a successful strategy as the American tax burden inevitably rises.
"Scrap the "progressive" system, and go FAIR Tax." (SF)
ReplyDeleteABSOLUTELY!
The Fair tax (http://www.fairtax.org/site/PageServer) IS the best of all alternatives SF. It would be a HUGE improvement merely by switching the onus FROM productivity, TO consumption.
It would NOT, as critics, often rightly point out, reduce government's intrusion into our lives. The IRS would simply become an army of "revenuers" checking to make sure that ALL goods and services are properly "stamped."
BUT it will bring ALL Americans into the tax policy debate, as EVERYONE would finally have some "skin in that game."
"As for the VAT Tax: anyone who votes for it, goes the way of the dodo bird at the polls in November." (SF)
Voters NEED to be aware of the Republicans who claim to oppose the VAT, but then refuse to correct it once set up.
THAT'S been the calumny of the GOP; claiming they're "appalled by the Dem's policies, BUT never eradicating them when given the chance."
From January 2001 through January of 2007 the GOP had every chance to pull out some of the Dem's worst abuses (including the CRA) out by the roots....and they didn't.
We have to hold them accountable because it does look like they're going to get another chance to do just that.