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Old February 24th, 2010, 12:12 PM   #1
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Our Unfair Way of Levying Taxes

The top 1% of wage earners in America pays more than 39% of the income tax. The top 5% pay more than 59%. The top 10% pay more than 70% of the taxes. The top 25% pay more than 85% of the taxes. While the bottom 50% pay just 3% of income taxes! (National Taxpayers Union - Who Pays Income Taxes?)



How is this even fair? In what other part of our lives are we required to pay a greater percentage the more income we have?



I believe that our tax system has gotten way out of control and has caused our government to grow way beyond our intended boundaries. Benjamin Franklin once said, "It would be thought a hard government that should tax its people 1/10th part." What would he think of our government now? This is certainly not what the founding fathers envisioned. Our government wasn't designed to be what it is, but rather it was designed to be small and provide only essential services instead of trying to be all things to all people. It was not designed to be part of the private sector, but rather was intended to do things that were needed and would not get done otherwise.



I believe that our tax system needs to be changed into a flat rated tax system. Everyone pays the same percentage. Is it fair? Absolutely!



Remember, it's the rich who create jobs. If you lessen their tax load, they will put more money into the economy which will create more and better jobs for those less fortunate.
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Old February 25th, 2010, 06:59 AM   #2
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How's that for a change that we can believe in?
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Old February 25th, 2010, 07:54 AM   #3
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How's that for a change that we can believe in?
"The rich" though are people too. If you change the system a bit, they'll initially revolt, but after a while, things will settle down to another norm. They'll still be rich and they'll find another way to manipulate the system.

The saying "Anything that doesn't kill me will make me stronger" is well intended but really bullshit. It should say..."Anything that doesn't kill me, Ill just have to get used to".
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Old February 25th, 2010, 08:10 AM   #4
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Originally Posted by fxashun
"The rich" though are people too. If you change the system a bit, they'll initially revolt, but after a while, things will settle down to another norm. They'll still be rich and they'll find another way to manipulate the system.

The saying "Anything that doesn't kill me will make me stronger" is well intended but really bullshit. It should say..."Anything that doesn't kill me, Ill just have to get used to".


Why would the rich revolt? This idea would lower their income taxes.
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Old February 25th, 2010, 08:28 AM   #5
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Quote:
Originally Posted by borden123
The top 1% of wage earners in America pays more than 39% of the income tax. The top 5% pay more than 59%. The top 10% pay more than 70% of the taxes. The top 25% pay more than 85% of the taxes. While the bottom 50% pay just 3% of income taxes! (National Taxpayers Union - Who Pays Income Taxes?)



.
It's not fair at all. I think the tax burden should be shouldered soley by poor people.
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Old February 25th, 2010, 08:34 AM   #6
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Quote:
Originally Posted by borden123
The top 1% of wage earners in America pays more than 39% of the income tax. The top 5% pay more than 59%. The top 10% pay more than 70% of the taxes. The top 25% pay more than 85% of the taxes. While the bottom 50% pay just 3% of income taxes! (National Taxpayers Union - Who Pays Income Taxes?)



How is this even fair? In what other part of our lives are we required to pay a greater percentage the more income we have?



I believe that our tax system has gotten way out of control and has caused our government to grow way beyond our intended boundaries. Benjamin Franklin once said, "It would be thought a hard government that should tax its people 1/10th part." What would he think of our government now? This is certainly not what the founding fathers envisioned. Our government wasn't designed to be what it is, but rather it was designed to be small and provide only essential services instead of trying to be all things to all people. It was not designed to be part of the private sector, but rather was intended to do things that were needed and would not get done otherwise.



I believe that our tax system needs to be changed into a flat rated tax system. Everyone pays the same percentage. Is it fair? Absolutely!



Remember, it's the rich who create jobs. If you lessen their tax load, they will put more money into the economy which will create more and better jobs for those less fortunate.
Unless you also cite the % of all wages earned by the top 1%, the statistic used by the taxpayer's union is worthless.



The top 5% of income earners earns 21.4% of the total national wage income, so they should, in theory, pay 21.4% of the income taxes in a non-progressive tax system. The top 20% has almost 50% of the total wage income. So, while the taxpayer's union stats show a disparity, it is not as large as one would believe because total wage income, as well as total taxes paid, are both clustered near the top.



How about this disparity ... the top 5% (and probably more) pay far less in social security taxes as a percentage of income. A person earning $106,800 pays the exact same amount as someone earning $1,000,000 or $10,000,000.



Both sides need to look at the entire tax picture.



In the United States, wealth is highly concentrated in a relatively few hands. As of 2007, the top 1% of households (the upper class) owned 34.6% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 50.5%, which means that just 20% of the people owned a remarkable 85%, leaving only 15% of the wealth for the bottom 80% (wage and salary workers).



Local sales taxes and fees are usually regressive because essentials are taxed to some degree.



I thought this article on a national sales tax was informative - The National Sales Tax: Who Bears the Burden?
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Old February 25th, 2010, 08:37 AM   #7
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Originally Posted by leighredf

How about this disparity ... the top 5% (and probably more) pay far less in social security taxes as a percentage of income. A person earning $106,800 pays the exact same amount as someone earning $1,000,000 or $10,000,000.
But doesn't social security also have a maximum benefit paid out too? If your benefits are only gonna be measured based on a maximum income level, why would you be taxed above that level?
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Old February 25th, 2010, 08:40 AM   #8
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Originally Posted by borden123
Why would the rich revolt? This idea would lower their income taxes.
I was using that as an example of what would happen under a change that was against the rich.



I agree with the flat tax.
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Old February 25th, 2010, 08:46 AM   #9
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But doesn't social security also have a maximum benefit paid out too? If your benefits are only gonna be measured based on a maximum income level, why would you be taxed above that level?
Yes, it does, and some have said do away with both caps (which would help a little bit). However, that analysis is based on the myth that social security can survive as some type of actuarially funded retirement plan (and it cannot given the ever increasing aging of society).



Social security withholding is far more akin to a tax than it is a contribution to a retirement plan. Since it is a tax, it needs to be so treated.



I think state workers ought to have to pay the social security tax even if they also have a state retirement plan - especially given the generous breadth of state retirement plans.



If everyone had to pay, then the rate could be further reduced.



Eligibility for social security should also be based on income (as it is now) and wealth.
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Old February 25th, 2010, 08:47 AM   #10
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I would trade a lower social security tax rate for the chance that I might never get any benefit (if I retire wealthy or have a high retirement income from other sources).



Yes, my proposals are not fair. Life's tough. Some people inherit millions, others do not. Some people have land that has gas/oil underneath, other's don't. "I make $500k per year in passive income at age 75 so you don't want me to get my $800 social security check?" Yes, that is exactly right.
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