I see this over and over “Half the people in this country don’t pay any taxes at all!”
Then someone throws up the graph of federal spending dominated by social security and medicare and says “and look how much money we’re spending on those folks that don’t pay anything”.
Face it: Most americans pay ~15% of their salaries in payroll taxes that go straight toward that SS/medicare spending.
So, when you add up the children, the unemployed, the stay-at-home moms, and the retired living on social security, you get 50% of the population. That sounds about right to me. So, what’s the problem here?
I haven’t seen or read where anyone has said fifty percent of the population pays no taxes “at all”. This isn’t to say that some haven’t, but so far as I can tell it isn’t common.
Generally, when people speak of half the population not paying taxes, they’re talking about (or they should be talking about) federal income tax. All income earners have to pay into Social Security and Medicare, but the government has decided to let half of them off the hook when it comes to running the rest of the country.
Half the people don’t work, and have no incomes to tax. Children, retirees, unemployed, etc. No surprise there.
Just to be fair, the figure is nearly half of all households, not people, pay no federal income tax.
Right, but those households do pay payroll taxes, sales taxes, property taxes (directly or through rent), gas taxes, excise taxes . . .
True. I was seeking to clarify that the notion put forth by Giles and Fear Itself that it makes sense that half the population (be they retired, children, or unemployed) would not pay FIT does not apply to the actual statistic of 47% of households paying no income tax.
Wrong. All *wage *earners have to pay Social Security and Medicare, and Social Security is capped.
And conservatives pull that crap all the time.
When do I stand in line for my rebate on alcohol, gasoline, airline tickets, phone, and other excise taxes? I’m always the last to know.
Those lazy SOBs don’t pay any capital gains or estate taxes either. What total freeloaders! I bet they use food stamps to buy Cadillacs, too.
Although I’m less likely to identify myself as an economic conservative than I used to be, I think the fact that a lot of people pay no federal income tax is a potentially dangerous thing: if you don’t pay taxes, you won’t necessarily care whether government raises them on people who do. Or how high.
And if it’s necessary to raise income taxes to pay for services these non-taxpayers receive, they’ll be even less opposed to raising them. As the saying goes, a government that robs Peter to pay Paul can always count on the support of Paul. And Peter should be concerned if 47% of households are Pauls.
It’s of course possible to mitigate this: when you raise existing taxes, lower the income threshold for paying taxes, so that more people have to pay something.
I presume you mean federal income tax. Everyone, at least where I live, pays sales tax, fuel tax, property tax ( directly or indirectly as in the case or renters), etc.
Then there’s the excise taxes, and a slew of other taxes. So, I’d say the list of people who pay no taxes is pretty small.
As a percentage of income, my property taxes are pretty small. My sales taxes are pretty small. We max out FICA, have capital gains at 15% - all that offsets our high marginal rate on income. We drive probably an average amount, so pay fairly average fuel taxes…etc. etc. Yes, we pay through the nose on that marginal rate, but our total tax burden is actually not a huge percentage of our income. Several years ago I figured it out - and we pay LESS now as a percentage of income than I did when I was 22 years old and made $14k a year.
My brother in law probably pays little or no income tax. But his property tax is probably 10% of his gross income. He doesn’t max out FICA, so every penny in wages is taxed. He spends almost everything he makes to survive, so there is sales tax on almost all his income .
I think we are actually really close in terms of percentage of our income that goes to filling our overall tax burden.
Something I didn’t know that I read today: social security benefits are taxed (4th item). So, if I understand that properly, anyone receiving social security is being taxed.
If correct, I think that’s quite a lot of people.
The extent to which your social security income is taxed depends on how much other income you have. Some people who receive SSI are not taxed on it.
Being totally unfamiliar with the particulars of social security, I decided to do a little googling. According to the social security administration, 54 million people received benefits (about 18% of the population; note that I tried to leave out people receiving supplemental). Then, according to this publication, about one third of recipients have to pay taxes on what they receive, so about 18 million people (6% of the population).
As long as I looked and found the information, I figured I’d post it.
It’s a lot worse than that. With a progressive income tax, anyone below a give marginal rate isn’t affected when that marginal rate is raised.
“Worse”, you say?
The term you’re looking for is lucky duckies. :rolleyes:
What’s so dangerous about that? If it doesn’t affect enough people for half of us to care, then the issue is obviously not as encompassing as you believe. We pay much less in taxes than comparable democracies anyway. I think a little more taxes and more government services, like universal health care, is a good thing
So you’d want to artifically create a group of people to be affected by taxes just so more people will agree with you? That’s like purposefully infecting people with a rare disease just so they’ll care about funding towards it’s research. If half the people don’t care about taxes being raised cause they don’t pay any, then good!
Take a cross section of American society . The ones at the bottom have very little money. The ones on the top pay a huge amount of taxes… But hell, they have almost all the money. As the money gets more and more concentrated in their hands, the total amount of taxes goes down. That is because the wealth provides them with access to the government. They get the government to continually cut their taxes until we can no longer deliver government services. So the rich force the poor to pay more and more making them even broker. The divide between the rich and poor gets bigger and bigger. That is where we are now.
To get rid of the debt, we have to have revenue. That requires collecting corporate and personal income tax from those who have the money and have gained the most . It is not difficult. We can not continue taking from the poor and the middle class. They are getting decimated.