- The top 5 percent of taxpayers paid more than one-half (53.8 percent) of all individual income taxes
- But reported roughly one-third (30.6 percent) of income.
So 5% of the population takes on 50% of the tax burden while only accouting for 30% of all income. Something doesn't quite seem progressive there.
- The top 1 percent of taxpayers paid 33 % of all individual income taxes in 2002. This group of taxpayers has paid more than 30 percent of individual income taxes since 1995. Moreover, since 1990 this group’s tax share has grown faster than their income share.
So in the past 20 years the top 1% has been getting taxed faster while accounting for a larger and larger percentage of taxes yet their income wasn't increasing at the same rate.
- Taxpayers who rank in the top 50 percent of taxpayers by income pay virtually all individual income taxes. In all years since 1990, taxpayers in this group have paid over 94 percent of all individual income taxes. In 2000, 2001, and 2002, this group paid over 96 percent of the total.
8 years ago, half of the tax payers pay 96% of the taxes.
- Final point - 38% of people filing income tax paid $0 in tax.
I would like a rational explanation as to why we should increase the tax burden on anyone in the top 50%, let alone the top 5% or 1%.
These number are courtesy of the US Treasury Dept.
I had a long comment prepared, but it got lost to a page error so I'll try again.
ReplyDeleteI know poor people have been queering the deal for the rest of us for too long, but I admit taxes don't set me off like you and Nevada Jay. This is probably for several reasons. One, I don't make as much money as you guys, though Mrs. Jimmy and I have seen significant salary increases in the last two years that definitely bumped up our tax bill a crapload.
But also, my business depends on fundraising from wealthy people that may be looking for tax shelter. Granted, there are many more altruistic reasons than that, otherwise they'd just move all their money into offshore accounts.
What does anger me is what our taxes are paying for... Nitwit wars based on half-truths and bailing out a bunch of erstwhile free market devotees who got a little too free for their own good. (Speaking of socialism.)
I don't disagree with any of your points.
ReplyDeleteThough I don't see how any of those points address the question. a) not caring and b) disagreeing with government spending... these do not provide a rational explanation to the current tax burden.
Funny how a request for a rational explanation was deflected (read as: dumb downed) to "nit wit" wars and bi-partisan bailouts.
To be sure, poor people were not at the heart of the argument, unless of course you consider 95% of the population 'poor'... do you consider 50% of the population 'poor'?
Want to try again Jimmy?
This comment has been removed by the author.
ReplyDelete"I admit taxes don't set me off ..." "but also, my business depends on fundraising from wealthy people."
ReplyDelete"It is difficult to get a man to understand something when his salary depends on his not understanding it."
So would you say your salary depends on you not understanding, or in this case, not caring about the current tax system?
Based on your Upton Sinclair quote and seeing as how your salary depends on the wealthy trying to escape their tax burden (altruistically or otherwise) and since your place of employment (while private) is still supported primarily on research grants from the federal government couldn't we say your perspective on the issue might be clouded? ...just a little?
(and yes you could say all of our salaries depend on taxes and therefore aren't all of our perspectives clouded... but I would say your salary, more so than the reset of us, is directly depended on the current tax structure)
I was just commenting, not pretending to have answers. *shrugs*
ReplyDeleteComments duly noted. taxes suck.
ReplyDeleteSo like Jimmy, I don't claim to have answers, but I have some comments.
ReplyDelete"yet their income wasn't increasing at the same rate" - That's unfortunately not true. The top earners have gotten much richer in the past two decades. Check the graph on citation [1].
Second, our tax rates on the top bracket are at the lowest they've been since WWI. During 1932-1981, the top bracket has been anywhere from 63% to 94%[1] (holy shit!). 1954, during the McCarthy era, we were ironically more socialist than ever with people who make over 200k being taxed at 91% [2]. Puts a bit of perspective on it.
Third, minimum wage has not kept up. I'm not saying we should raise minimum wage (that's another conversation), but if Joe the Laborer's income doesn't go up, he isn't contributing any more taxes than he was 20 years ago. But rising costs and inflation means the gov't needs more tax revenue just to keep things going. Where does that tax revenue come from?
[1] Income Gap Is Widening, Data Shows
[2] Wikipedia: Tax Rates in History
[3] Wikipedia: IRS code of 1954
"Based on your Upton Sinclair quote and seeing as how your salary depends on the wealthy trying to escape their tax burden (altruistically or otherwise) and since your place of employment (while private) is still supported primarily on research grants from the federal government couldn't we say your perspective on the issue might be clouded? ...just a little?"
ReplyDeleteFair enough, but I feel my perspective is even more clouded by the fact that I don't believe taxes to be inherently bad. You slag off my comments about the war and bailout, but I don't think you can have a discussion on the fairness of taxes without talking about where the money's going.
I also like how you point out the bailout was "bipartisan" as if I'm some democrat hack conveniently forgetting things. Stop doing that.
>> 1954, during the McCarthy era, we were ironically more socialist than ever with people who make over 200k being taxed at 91%
ReplyDeleteThat comment has no perspective. $200k in 1954 vs $200k in 2008, are we really supposed to believe that a guy making $200k in 2008 is anywhere even remotely comparable to a guy making $200k in 1954???
In 1954 the average income was $3,500 and the average family got taxed at a rate of 22%. In 2005 the average income was $44,000 that guys would been taxed at 15% (not to mention child tax credits)
(http://en.wikipedia.org/wiki/Internal_Revenue_Code_of_1954)
http://en.wikipedia.org/wiki/Jobs_and_Growth_Tax_Relief_Reconciliation_Act_of_2003
I would conclude by these numbers that the system has shifted the burden to the upper income brackets unevenly.
I 100% agree on the minimum wage though, that is messed up.
Attention democratic hacks: Stop raising my taxes.
ReplyDeleteNone of these comparisons to 1954 numbers make sense without adjusting for inflation.
ReplyDeleteComparing percentage of tax does include inflation. Bottom line: the average family in 1954 paid a higher rate than the average family in 2003.
ReplyDeleteBTW, 2003 includes the Bush Tax cuts.
That supports my argument that the upper tax brackets are paying a larger share than I would consider fair, reasonable, or 'progressive'.
I haven't really heard a solid argument against this. I've heard: I don't care, 1954 was also messed up, the minimum wage is screwed, tax burdens are irrelevant unless we talk about where the revenue is spent.
Can someone justify the current tax disparity? or better yet, justify a potential increase in the to the top wage earners?
(also before someone throws out something like "Warren Buffet only paid 11% total tax and his secretary paid 30%." I will say that is also messed up, loops holes for the very wealthy are completely backwards. We can have that debate as well, but that doesn't effect the facts laid out at the beginning of this post.)
Comparing percentage of tax does include inflation.
ReplyDeleteHuh? 30% is 30% no matter what decade or century it is. I'm more interested in seeing the buying power that average family income had in 1954 vs. today. And, for that matter, what was the median household income in 1954? Average, as you know, can skew the data.
Can someone justify the current tax disparity? or better yet, justify a potential increase in the to the top wage earners?
Because they can afford it. The democrats say it, your man McCain said it. It's not fair, but it's true.
Kojiro-san was right. This comment system is moronic. If the bulk of the arguing is taking place in these comment threads, we should just set up a phpBB forum somewhere.
ReplyDeletehttp://www.census.gov/hhes/www/income/histinc/f07ar.html
ReplyDeleteIt was $4,100.
>>It's not fair, but it's true.
Thank you. It's not fair and it has gotten more extreme.
>>Because they can afford it
Can they?
I don't understand the problem with the comments? Blogger actually added the embedded comments feature to make it more forum-like. How is this any different than a forum?
ReplyDeleteIt's just not very smooth, no automatic quoting or text formatting for WHEN I WANT TO YELL AT YOU FOR BEING A DOUCHE!!!
ReplyDeleteThe comments still feel hidden. A forum has icons to let you know when a thread has a new comment that you haven't read. And active threads move up to the top. Just a better format. Blogs are more for soapboxes, not for conversations.
ReplyDeleteSo on minimum wage and taxes, I feel like a lot of this is actually a side effect of the global economy. Technology has allowed people to own and run a business pretty much anywhere on Earth. So if Joe the Factory Owner feels like he is paying the American worker too much, he can move the factory to South East Asia and save a ton of money on labor, even with the additional shipping costs. So I think this is one reason minimum wage has not kept up, because it would price us out of the market and what little manufacturing that remains here would be sent overseas.
ReplyDeleteIn addition, Joe the Factory Owner may choose to live and own that same factory overseas because the taxes are more favorable for him. I really think this, more than any political ideal, is what brought about the tax cuts in the 80's. It was an attempt at keeping businesses in the US by making it more profitable via lower taxes.
On my last comment, with minimum wage, I may have been assuming too much because I've never heard of any factory paying minimum wage, so maybe that point is not valid. Though I still think my second point is valid.
ReplyDeleteI just watched the minimum wage episode of 30 Days recently and there was a guy on there who said he was making $7.25 an hour when he started in an automotive factory in the 1970's. Now, he makes $7.00 an hour doing random temp work, since the auto industry tanked. 25 years, and he has only seen a pay cut. Not even counting inflation here!
Koj, you should start a separate post on the min wage. Something that has been bothering me is the confusion between a minimum wage and a livable wage.
ReplyDeleteAre they the same thing? Should they be? When does a minimum wage become welfare? What is the purpose of a minimum wage? Is it to protect employees from being taken advantage of or is it to ensure sufficient income for basic needs?
I do agree that, whatever the definition, the current min is too low, regardless of why.
The one thing that is nice about the blog is that the comments are behind the scenes. The blog posts are there and are not influenced by the comments. Unlike a forum where the posts and comments are one in the same. Blogger implemented the embedded comments options (like we are using) to make it more forum-like. So you can post news stories or topics and the discussion can go on behind the scenes. I think there are some plugins that make the comments more threaded though... I'm looking into it.
ReplyDelete