Top 1% Earn 19% of Income, But Pay 37% of Taxes
Yes, income in America is skewed toward the rich. But taxes are skewed far, far more. The top 5% pay well over half of all income taxes (57%) even though they only earn only 33% of the total income. The wealthiest 1% earn 19% of total income but pay 37% of all taxes. Somehow that never seems to upset those who profess to be concerned about "fairness" and "social justice" and "equity."
Stephen Moore has breaks down the numbers for us in "Guess Who Really Pays the Taxes."
23 Comments:
Should the top 1% of income earners find this unbearable they are free to leave this country or lobby for an increase in the minimum wage so that low income earners can pay more taxes.
Yeah, the top 1% of earners should definitely leave the country and take their money with them. We'd be SO much better off then!
I think half the fun in this blog is in reading the ignorant comments that follow many of the posts!
Anon 7:23,
I think half the fun in this blog is in reading the ignorant comments that follow many of the posts!
You said it! Encouraging capital flight would only serve to lower standards of living. Everyone could finally be "equal" - equally poor.
they are free to leave this country or lobby for an increase in the minimum wage
They're also free to lobby against increases to taxes. "Equal under the law" does not have a clause reading 'unless they are a hated minority or you just don't like their attitude'.
...and, of course, those 1% didn't derive *any* benefit whatsoever from public infrastructure, an educated workforce, the legal system, publicly-funded basic science research, etc.
Boo fricking hoo.
[am personally in top 1%]
Oh, and why doesn't Moore include FICA/Medicare in this calculation? Is it because he's a dumbass or because he's being intentiaonally misleading: excluding payroll taxes adds about 8% on to the marginal tax rate of everyone making roughly less than $100,000 per year, but 0% to the marginal tax rate of people making more.
"and, of course, those 1% didn't derive *any* benefit whatsoever from public infrastructure, an educated workforce, the legal system, publicly-funded basic science research"
No more than was available to everyone else...
Besides that, the more fundamental argument is that tax cuts actually increase revenue, thus providing more for all of those things.
Anonymous 8:10 AM said...
Besides that, the more fundamental argument is that tax cuts actually increase revenue, thus providing more for all of those things.
Why not just eliminate taxes for the top 5% of income earners all together?
Anything the private sector needed like transportation for it's workers could come from the private sector like Hong Kong's HK$7 billion Western Harbour Tunnel (Build-Operate-Transfer [BOT]) project.
http://www.westernharbourtunnel.com/txt/en/about23.html
Hey holymoly why should Moore consider the Constitutionally questionable extortions called FICA and Medicare?
What part of the socialist services to the top 1% of the earners use compared to the bottom 50%?
"Why not just eliminate taxes for the top 5% of income earners all together?"...
Good question...
Why don't those that use the socialist services actually pay for them instead of stealing from others who happen to be compensated more for their productivity?
"Hey juandos!" ...because the topic is taxes, and the tax share by income. And FICA/Medicare are ...
wait for it...
*taxes*.
Sheesh.
"And FICA/Medicare are ...
wait for it...
*taxes*."...
Hmmm, someone calls extortion taxes... Amazing!
juandos -
Extortion! Coercion! ...
"Chewbacca is a Wookiee from the planet Kashyyyk. But Chewbacca lives on the planet Endor. Now think about it; that does not make sense!" (the "Chewbacca Defense," - South Park episode "Chef Aid" October 1998)
"Should the top 1% of income earners find this unbearable they are free to leave this country or lobby for an increase in the minimum wage so that low income earners can pay more taxes."
Increasing the minimum wage would leave low income earners paying less taxes, because more of them would be out of jobs.
Artificially increasing the price of something (labor) leads to lower demand (less jobs).
How do you think the top 1% typically earn their money? It is from the productivity of the "lower" echelons. The people who actually produce a product or provide a service. Without those people the top 1% would not be where they are today.
Another thing, if lower rung employees don't earn as much, who do you think is going to buy the products and services that keep ALL of us going? As to the percent of taxes paid by large income earners, to say that they don't benfit more from OUR commons is ludicrous. They use more of the roads with trucks to get products to market. They benefit from a better educated workforce. They use more police services to protect them from others and to enforce judgements against people. Also they use most of the time and resources of our judicial system to protect their interests.
I am not saying business is bad! Without them we would still be in caves gathering berries. But to say that they shouldn't pay their way is simply unAmerican!!!!!!
Bob earns 500 dollars a week pays 10%taxes= 50 dollars, Ted earns 5000 a week pays 10%taxes =500 so your saying ted should only pay 50dollars thats your point on taxes make it fair?
This title of this post is the same canard that is used to pit one group of income earners against another by manipulating percentiles. While I dispute the figures in the premise (the reality is that the top 1% of earners actually earn about 39% of the money while paying only 37%), what's hidden in that top 1% are the super rich who rob this country blind and don't pay anything near their fair share.
The income cutoff for the top 1% of earners includes all those earning over $388,806. Most of those who earn less than $1,000,000 are laborers (lawyers, accountants, even corporate CEOs) and pay 37% of their income in tax. BUT AND THIS IS IMPORTANT SO PAY ATTENTION, the top 1/4 of 1%, those earning over 10 million pay less than 10% of their income in taxes (excluding tax shelters and tax havens) because their income is considered "capital gains." This group of the top .025% "earn" (not through their hard work but simply by virtue of the fact that they own almost 90% of the assets in this country) 25% of the income in this country and PAY LESS THAN 10% of the taxes. Stop letting the CAPITAL CLASS, those few hundred thousand who own most of the country's assets and earn most of the money in form of capital gains pit the high end of the laboring income earnings against the low end of the income earners, GET REAL. Even if those who earn less than a million a year get some of their income from capital gains, the disparity in wealth between the millionaires and the billionaires is so incredible as to be laughable if it weren't so tragic. But the billionaires who earn ALL of their money from capital gains convince those who earn under 10 million to side with them on the capital gains issue not understanding the statistics. If we taxed those earning over 10 million a year at the same tax rate as those making $388,000 to 10 million a year, income tax rates could be reduced on everybody by as much as 20%, bringing down the income tax rate close to the capital gains rate. Just raising the capital gains on capital gains over 2 million a year up to 25% (still less than the top marginal income tax rates), we could finally get the ultra rich to pay their fair share and either pay off the national debt or cut everyone else's income tax in half.
Thank about it and be careful when people try to manipulate you with statistics; always drill deeper into the stats.
Sorry but your figures are wrong: The top 1% of earn 39% of the income (not to mention that they OWN 90% of the assets in the country off of which they "earn" most of their money, most of which was inherited except for a handful like Bill Gates). Still they only pay 37% of the taxes. Further, this doesn't include payroll taxes which disproportionately fall on those that make less than $57,000 because after you make that much you don't pay any more SSI; further other taxes, particularly the sales tax is a greater portion of your total income as you make less not more money. So stop lying about the facts and figures. Also, if you dig deeper into the top 1% number, you find that the top .025% earn 35% of the income and only pay less than 15% of the income tax. Remember the top 1% includes those making $325,000 on which they are heavily taxed because most of that income is by their labor (doctors, lawyers), while the top less than .25% earn in the 100s of millions or billions and most of that is considered "capital gains" so they are taxed for the majority of their income at the low rate of 10-15% (and the Republicans want to cut this rate even further). So Billionaires pay the same tax rate as those making less than $15,000 a year. Pretty fair.
It's kind of funny how so many of you who are NOT billionaires have been so well manipulated into using misleading "percentile" breakdowns to defend the unconscionable reality that those making in the 100s of millions or more get away with paying almost nothing while those who make handsome incomes but less than a couple of million are carrying the real burden of taxes at the top end. Start discussing this honestly and you might get on the side of those who believe that small group of under 1 million people who own over 90% of all the wealth in this country should be paying 90% of the taxes rather than less than 10% while those aspiring to make a million are taxed at exorbitant rates.
The incredibly rich have gotten us to argue over the crumbs while they laugh all the way to the bank, avoiding the taxman all the way.
Check your facts!!!
This title of this post is the same canard that is used to pit one group of income earners against another by manipulating percentiles. While I dispute the figures in the premise (the reality is that the top 1% of earners actually earn about 39% of the money while paying only 37%), what's hidden in that top 1% are the super rich who rob this country blind and don't pay anything near their fair share.
The income cutoff for the top 1% of earners includes all those earning over $388,806. Most of those who earn less than $1,000,000 are laborers (lawyers, accountants, even corporate CEOs) and pay 37% of their income in tax. BUT AND THIS IS IMPORTANT SO PAY ATTENTION, the top 1/4 of 1%, those earning over 10 million pay less than 10% of their income in taxes (excluding tax shelters and tax havens) because their income is considered "capital gains." This group of the top .025% "earn" (not through their hard work but simply by virtue of the fact that they own almost 90% of the assets in this country) 25% of the income in this country and PAY LESS THAN 10% of the taxes. Stop letting the CAPITAL CLASS, those few hundred thousand who own most of the country's assets and earn most of the money in form of capital gains pit the high end of the laboring income earnings against the low end of the income earners, GET REAL. Even if those who earn less than a million a year get some of their income from capital gains, the disparity in wealth between the millionaires and the billionaires is so incredible as to be laughable if it weren't so tragic. But the billionaires who earn ALL of their money from capital gains convince those who earn under 10 million to side with them on the capital gains issue not understanding the statistics. If we taxed those earning over 10 million a year at the same tax rate as those making $388,000 to 10 million a year, income tax rates could be reduced on everybody by as much as 20%, bringing down the income tax rate close to the capital gains rate. Just raising the capital gains on capital gains over 2 million a year up to 25% (still less than the top marginal income tax rates), we could finally get the ultra rich to pay their fair share and either pay off the national debt or cut everyone else's income tax in half.
Thank about it and be careful when people try to manipulate you with statistics; always drill deeper into the stats.
Sorry but your figures are wrong: The top 1% of earn 39% of the income (not to mention that they OWN 90% of the assets in the country off of which they "earn" most of their money, most of which was inherited except for a handful like Bill Gates). Still they only pay 37% of the taxes. Further, this doesn't include payroll taxes which disproportionately fall on those that make less than $57,000 because after you make that much you don't pay any more SSI; further other taxes, particularly the sales tax is a greater portion of your total income as you make less not more money. So stop lying about the facts and figures. Also, if you dig deeper into the top 1% number, you find that the top .025% earn 35% of the income and only pay less than 15% of the income tax. Remember the top 1% includes those making $325,000 on which they are heavily taxed because most of that income is by their labor (doctors, lawyers), while the top less than .25% earn in the 100s of millions or billions and most of that is considered "capital gains" so they are taxed for the majority of their income at the low rate of 10-15% (and the Republicans want to cut this rate even further). So Billionaires pay the same tax rate as those making less than $15,000 a year. Pretty fair.
It's kind of funny how so many of you who are NOT billionaires have been so well manipulated into using misleading "percentile" breakdowns to defend the unconscionable reality that those making in the 100s of millions or more get away with paying almost nothing while those who make handsome incomes but less than a couple of million are carrying the real burden of taxes at the top end. Start discussing this honestly and you might get on the side of those who believe that small group of under 1 million people who own over 90% of all the wealth in this country should be paying 90% of the taxes rather than less than 10% while those aspiring to make a million are taxed at exorbitant rates.
The incredibly rich have gotten us to argue over the crumbs while they laugh all the way to the bank, avoiding the taxman all the way.
Check your facts!!!
marsx,
Your comment is so riddled with errors that it's difficult to know where to begin.
Here's just one glaring error: FICA taxes you at 12.4% on the first $102k (6.2% from you and 6.2% from your employer), not the first $57k. Additionally, FICA Med taxes at 2.9% (1.45% from you and 1.45% from your employer) and there is no income cap on this tax.
Go back and check your facts, buddy.
If you could refute the basic point I'm making, you wouldn't try to distract from the issue by focusing on the details. Step out of the forest and stop staring at the trees.
Thomas,
I do have one question that always intrigues me. Are you he heir to a massive fortune? If not, why do you carry water for them?
This is just double speak. The top 1% paid 37% of the taxes, but that was not 37% of their income. They pay a smaller percentage of their income than the average American due to tax loopholes. The little bit that they can't get out of paying comes to 37% of all the taxes because they make soooooo much!
I'd appreciate it if some of the posters who are concerned with the fairness of a progressive income tax took a moment to consider the fact that one of the best indicators of a child's success in life is his parents' income.
I believe as you do that success should be a result of triumph in fair competition. However, in any fair fight both contenders must have access to the same basic equipment. Before I can honestly make the claim that I "deserve" my money more than the poor guy next to me because I competed better than he did, I need to make sure his arm isn't tied behind his back.
I'm not going to fight his battles for him, but to be fair, I need to make sure he has had access to the same basic tools needed for success as I have. These tools in context: access to education and good health.
dirk0059,
Life's not fair.
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