Sunday, October 04, 2009
Almost Half Pay No Income Tax
While most of those are in the lower brackets, there are some in higher tax brackets, too. I don't have a problem with some "progressivity" in income tax rates, but if we're going to have an income tax, everyone should pay something. There are too many people voting on what to do with somebody else's money and that's not sustainable.
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5 comments:
While the poor don't pay income tax, they pay plenty of other regressive taxes.
However, my concern is the corporate income tax. Many have argued that the USA has the highest corporate rate in the world, but that's really a red herring. For, the GAO reports the 2/3 of US corporations pay zero income tax. Of those that do each year, 90% of companies pay a 5% rate. That's a problem.
Additionally, in 1950, corporations accounted for 35% of all income taxes paid. Today it's less than 10%. Certainly, spending is a problem. But you have to lay much of the deficit and the $10 trillion debt on corporations weaseling out of their taxes, while taking billions in subsidies and tax breaks.
For more info, I highly recommend the books Free Lunch and Perfectly Legal by David Clay Johnston. Donald Bartlett's books are also quite informative for people who want the whole story.
I don't blame any person or corporation that legally avoids paying taxes. I blame a Congress that writes crappy laws--apparently, according to Senator Thomas Carper (D-Delaware), laws they don't even read.
Actually, no businesses pay taxes. We do when they pass the cost on to the consumer.
Rightwingprof; I agree. In my perfect world there would be no taxes on businesses and all taxes would be on individuals because that way people would see how much taxes they were paying, whereas by taxing businesses people have no idea of how much total taxes they are paying.
thank you, rightwingprof. Also, everyone pays FICA (or a STRS like equivalent), which is matched by their employer -- which is passed back on to them by a lower wage. This makes for an effective tax rate of 16%, and only on the first 100k or so. Since Medicare/medicaid and Social Security are the three largest expenditures of the federal government (I could be wrong -- defense might be top three) the whole not paying income tax is a technically correct misnomer.
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