“Ha! I pay less taxes than a billionaire!”
Ah, the joys of being able to bribe… er, um… send campaign contributions to those who write the tax laws.
The incomes of the top 400 American households soared to a new record high in dollars and as a share of all income in 2007, while the income tax rates they paid fell to a record low, newly disclosed tax data show.
In 2007 the top 400 taxpayers had an average income of $344.8 million, up 31 percent from their average $263.3 million income in 2006, according to figures in a report that the IRS posted to its Web site without announcement that were discovered February 16.
The figures came at the peak of the last economic cycle and show that widely published reports in major newspapers asserting that the richest Americans are losing relative ground and “becoming poorer” are not supported by the official income data.
The long-term data show that under current tax and economic rules, the incomes of the top earners rise when the economy expands and contract during recessions, only to rise again. Their effective income tax rate fell to 16.62 percent, down more than half a percentage point from 17.17 percent in 2006, the new data show. That rate is lower than the typical effective income tax rate paid by Americans with incomes in the low six figures, which is what each taxpayer in the top group earned in the first three hours of 2007.
Don’t see a whole lot of downward trickle these days. Wassup with dat?
Friend got cash for clunker, so got tax for Toyota. Losing value now with safety concerns. Wants a write off for lost value and is making monthly payment on underwater Toyota financing. I invested in old tax Dodge. Could use a submarine sandwich for lunch. Friend is looking for free lunch.
#1 Did you EVER see any legitimate downwards trickle??
I sure as hell haven’t.
It was always just a scam-meme introduced to make the bottom 90% feel good about the top 10% get huge tax breaks while they’re being royally screwed with sand in the lubricant.
Toyota dealer paid to pour clunker killer in Ford V-8 to qualify for idiot program. I bought motor oil for Dodge V-8 for smooth operation. If we blow up our pickup truck engines and get new Toyota power we will reach fed heaven and receive many virgins. Put motor oil in your windshield washer bottle. Sleep in your bed!
I never understood why middle class Americans seem unwilling to see the rich pay more in taxes. But I also don’t understand why middle class Americans who are getting screwed by insurance companies are so insistent that insurance companies are the best place to get their health insurance. Someone is doing some excellent p.r.
Drink the DrainO kids.
Insurance makes $10 act like $1,000, unless it is AIG. Then you reverse that computation.
You have a job? Then trickle down works. That is, unless you are employed by a poor person. Oh wait. You think you have a RIGHT to a job. Nevermind, you’re an idiot.
10% blanket tax for all, user pays (equal %) tax for all other services and retraining programs and new jobs for accountants.
LDA, you mean 40% blanket tax for all (which is close to my total tax rate including State, Sales Tax, etc.).
Never a dull moment dear. Stay sharp.
I found the most interesting part of the article was the expansion of their income during boom times.
If you understand how the Fed works, you will understand how that happens.
Back on subject:
Amendment 16 to the U.S. Constitution —
The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.
Hey, The People passed this. It must be ok, right?
Perhaps more people should have listened to Ron Paul.
Nothing “trickles down”.
If I own a business, or run a project, I add only enough people to get the job done – AND NO MORE. I keep everything, not paid in wages, as profit!
If my tax rate goes down, I can either charge less for my products -or- pocket more profit by charging the same price and holding wages steady.
If my competition gets a tax reduction, he may lower his prices to drive me out of business or force me to lower prices too. If I go out of business, my employees are then unemployeed.
There is no such thing as “trickle down”.
I like when idiots complain about how much the “rich” pay in taxes and how they want THEM to pay more.
the top 20% wage earners already pay 80% of the bill on their own, the “bottom” 80% only pay 20%. The bottom 20% don’t pay ANY taxes and actually get refunds on the taxes they DON’T PAY!
Exactly how is that fair? How about EVERYBODY pays the exact same amount, that is fair and the “rich” will still be paying more because 20% of 250k is more than 20% of your 50k a year
Drop the class warfare BS and quit playing victim
and trickle down does work and when you lower taxes revenue to the govt goes up. Proven fact
#13 Not true. There is trickle down. If I have a business and my tax rate goes down, I have more operating capital to work with in the business. Lowering my rates will increase demand and I will need to add another machine to my assembly line and I will also need a new worker to run that new machine. Hiring a new worker makes demand for that type of labor go up which means my competitor will have to raise wages if he wants to add a new employee. The cost per unit goes down when I increase my economies of scale.
If my taxes stay high, I won’t add the new machine or hire the new employee, or lower my rates. My economies of scale remain the same. No new employee wages go into the economy.
Whenever tax rates are lowered, tax revenue actually increases. Obviously there is a point where you lower rates near zero and the revenue goes to near zero, but if tax rates are 100% then you also lower revenue to zero. Put the tax rate such where the money can come out of tax shelters and help the economy. What rate is that? I don’t know. It is probably between 15% and 35% for Federal taxes. That is a big range.
#13 — My thoughts are basically inline with yours. I have a question for the people who say that tax breaks for small businesses would increase employment. How much of a tax break would be needed to cause a small business to hire an employee they do not need at this particular time?
I would think any tax break given would just end up in the business owner’s pocket. This is not a bad thing but it does not help the situation of hiring of employees.
#16: A tax break could be a good incentive for some to start a small business. I’ve owned my own businesses in the past and between regulations, health insurance costs and taxes, it isn’t worth it anymore.
Can you guys do basic math? Look at the the tax rates TFA is quoting, lets just say I made $300 million and some poor shlub makes $30k. If they were both taxed at a flat 10%, the Shlub pays all of $3k(or none maybe) and the “Rich” guy pays $30,000,000, 8 figures there…. Man you guys make it sound like they don’t pay anything! No trickle down my a$$!
# 10 Father
I mean ‘should be’. 40% is criminal.
Benjamin,
Lowered taxes would lower your overall expenses to produce something. You could choose to lower your prices in the HOPE of spurring demand, if you think prices are holding back demand (unlikely, unless people are moving into your area or you have an expanding export market (out of state or overseas)). Lower prices generally flood the market short term, causing a long term slowdown (see domestic auto business as an example).
However, if everyone else lowers prices due to a tax cut, you could be forced to lower your prices to stay in a market. You would be facing an expectation by the consumer of lower prices, because everyone else is lowering their prices, while also being in a market flooded with lower priced goods. In that scenario I would worry about staying alive, and WOULD NOT hire anyone.
I don’t know why you’re all discussing small businesses. I doubt that any small business owners are making 100s of millions of dollars annually.
#14
I dont know why you suggest that they drop the class warfare BS. If you understood that the banking system creates money from debt you would know that the more money the upper class hoards the more debt the lower and middle class is in.
This headline is misleading. The amount paid is still higher, regardless of the effective tax rate. The top 5% of wage earners pay over half of the taxes. 96.54% of taxes are paid by the top 50% of wage earners. Taxes are high because we all want government handouts, and government doesn’t produce wealth. We do.
http://wurl.us/w5AM
How about the math :
for 2007, 344.8 million x16.6 percent=57.2 million
for 2006, 263.3 million x17.17 percent=45.2 million,
So the 55.2 million in taxes paid in 2007 is less than the 45.2 million in taxes paid in 2006 ?
Just stop playing the “rate card”, it is the “bottom line card” that pays the bills— 57 million will pay more bills than 45 million
#23 You proved my point about tax revenue at least.
Which is why tax rates should be flat and fixed at every census. FIx the tax rate at 15% for everyone add a small percentage VAT 2% on all sales fixed for 10 years and walk away. It should take a 3/4 majority to change it after that.
Low and unchanging rates spur investment and growth. There’s no “trickle down” because every couple of years the tax code changes and if you made a long term investment you get screwed. Every other day Obama talks about a new tax strategy. “Spread the wealth”.. “target the tax”… “make it fair”… “$200,000 $250,000 over $400,000”. Nobody is going to hire anyone in a situation like that.
Keep it low, fix it for 10 years and you will generate as much revenue as you need. Taxes are about turning over dollars, relatively small amounts turned over many times are the key to generating revenue (because there is no cost basis to tax, you don’t even need to pay people to collect it, just to enforce a tiny percentage of it).
Of course they will never do that because politicians don’t use the tax code to raise revenue for projects they want to do. They use the tax code to enhance their power, to choose their own “winners” and “losers”, and you can pay them to be a winner.
The only thing that I have seen trickle down, is when I am in the bathroom, and I forget to drain the weasel completely.
It’s no wonder that the rich have more rights. They have bought and paid for it. And now who is it who wants to not stop the tax cuts for the rich? I think if we brought back Eisenhower Era taxes, the middle class would be a whole lot better off. Right now there is a war on. It’s called a class war, and the rich are winning. They own the media, the politicians, and the means of production. There will not be a revolution, because too many people believe the propaganda that they are being fed from the media outlets that are owned, lock, stock, and barrel, by the same rich people who own the politicians.
Rich are rich and well deserved because they are not aholes like we are. They don’t spend their time on stupid blogs like DU arguing and fighting over carefully selected topics.
So while we complain they do the real thing and make the bucks and keep them. Go figure. Notice there is no mention of “Right” or “wrong” here.
Do you realize that when you make the argument:
“the top 5% or 10% pay 80% or 90% of the total taxes”
you are simply proving the absolutely insane disparity between the rich and the poor?
>I never understood why middle class Americans seem unwilling to see the rich pay more in taxes.
Well, let’s look at the numbers the editors gave us. 16.62% of 344.8 million is about $57 million in taxes paid. The previous year, they paid 17.17% of 263.3 million, which is about $45 million. So would you rather have the rich pay $45 million in taxes on $263 million or $57 million in taxes on 344 million?
Now let’s get some comparisons to more recent years.
Either do a flat income tax for all or do away with all income tax and just have a fair tax for all consumable goods and services.
Under the fair tax, every person would get a monthly stipend to cover their geographic cost of living for each person’s “basic needs”. This way EVERYONE’s basic needs are covered and “tax free” (including the poor). If you choose to live a more opulent lifestyle then that tax comes out of your pocket.
The problem is this form of taxation gives too much power to the people by allowing them control their spending. In addition, it’s too transparent for government and forces them to be more accountable. As much as I’d love to have a fair tax, it’s will be heavily against by liberals who want as many entitlement programs as possible.
Last I heard if we did away with the Income Tax, a Fair Tax (sales tax on steroids) would be something around 30% for all goods and services consumed.