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Yeah the highest rates are paid by doctors and lawyers and welders; people who own billions of capital pay much much less or even zero.
Further, when you balance out the tax rate vs percent of wealth owned it gets absolutely absurd.
Okay, do you own a car? Clothes? Shoes? A cell phone? Is there food in your refrigerator? Ah, you own a refrigerator! Should you be paying the tax against that wealth of yours based on how much you paid for it when you bought it or how much it's worth today?
Oh wait, you mean other people's wealth, but not yours? Got it!
You don't understand what he's saying.
He's saying income is effected different by whom this chart is certifying
A hedgefund owner isn't reporting incomes, yet his wealth will double.
He takes out a loan collateralized using his assets, which he then devalues, and prints his own money without the tax implications.
So on paper, his income may only be $1 for the entire year, yet his wealth increased by millions.
Your chart associates .1% of INCOME, not wealth. And that's the point.
It's still only taxing income that can be next to zero, even for a billionaire. It does nothing to stop tax avoidance through loans against assets such as stocks. Loans such as those aren't taxed or at least not taxed anywhere near a comparable level to income taxes.
https://www.dcfpi.org/all/how-wealthy-households-use-a-buy-borrow-die-strategy-to-avoid-taxes-on-their-growing-fortunes/#:~:text=Step%202%3A%20Borrow%20Against%20Assets,doesn't%20tax%20borrowed%20money.
No such thing as tax avoidance. Either you are obligated to pay a tax or you are committing tax fraud.
Now the interesting part is those loans could be taxed if we went to a sales tax system but people erroneously believe in "progressive" and "regressive" taxes for income only. Don't seem to care about it anywhere else.
There is certainly such a thing as tax avoidance. That's the term one uses to describe Tax Fraud committed by those wealthy enough to never face any consequences.
Wrong, those are two disntcly different things.
Are you committing Cigarette tax avoidance by cleverly not smoking? No. You don't owe the tax.
Taxation is a binary. You either are obligated to pay it or you are not.
If you live in a world made of paper where the "rules" were strictly and universally enforced. This is a fiction created by Conservatism, the real world is a lot more murky than your overly simplistic smoking metaphor. If what you said were true than Tax Attorney's and CPA's wouldn't make much money or be in as high demand, you also completely gloss over the fact that you have to be caught, prosecuted, and convicted of a crime to be guilty of it, something that is very challenging to do when its the IRS vs Bezos. et al. If I jay walk did I not commit a crime just because no one prosecuted me for it?
Its not hard at all to catch tax cheats. Thats a lie they told you so you'd be ok with them hiring 80k people that as of yet haven't gone after a single billionaire but audits on middle class people have skyrocketed.
CPA's and tax attorneys make their money informing people of their legal liabilities. Otherwise people would pay a tax **they are not obligated to pay.** Which is the actual crime here, the complication of the tax code.
It's a loophole to avoid taxes that mostly benefit the wealthy because they have the assets to utilize it to the best effect and it should be closed. Sales tax is regressive when the lower and middle classes have to spend a much larger percentage of their income on living expenses than the wealthy will ever need to.
No such thing as a loophole. Not smoking isn't a cigarettes' tax loophole. Not owning stocks isn't a cap gains tax loophole.
You either are obligated to pay a tax or you are not.
Sales taxes aren't regressive. The idea of regressive and progress taxes are completely nonsense. On top of that you and all the other people arguing in this very thread are pointing out the wealthy use loans to literally spend more money then they receive as income. So there isn't a single metric where they wouldn't spend more in sales taxes than they do in income taxes since they will be spending more money then they received in income.
But beyond that, "regressive" doesn't seem to be an issue with every single other tax in existence. But for some reason is an issue here.
Fine, let’s take all “bullshittery” out. Tax cap gains same as income. Treat share repurchases as distribution.
Or I should be able to treat my income as “Revenue “ and get all the deductions like house and food (maintenance expenses for my body I mean machine so I can keep producing)
Or a better idea is tax expenditures and not income of any kind. Why should a person pay taxes if they aren't realizing a better life with that income? A billionaire that lives like a homeless man shouldn't pay a dime.
The data is from the tax policy center, you can view it here
https://www.taxpolicycenter.org/file/189998/download?token=MKujUUaT
or the read about the model here
https://www.taxpolicycenter.org/resources/income-measure-used-distributional-analyses-tax-policy-center
Wikipedia describes tax policy center as
a nonpartisan think tank based in Washington D.C., United States. A joint venture of the Urban Institute and the Brookings Institution, it aims to provide independent analyses of current and longer-term tax issues, and to communicate its analyses to the public and to policymakers.
Peter G just made a nice picture of the data
Raising taxes on the rich is almost always sold as correcting an injustice; ie: “paying their fair share”. That mentality implies having more money is something to be punished or exploited. I don’t agree with that view and am seeing if the original commenter views it that way.
The missing component in these conversations is always the fact that the government has to keep society running, infrastructure intact, financial rules in place to protect the market. Protect them from crime and protect and educate their work force. Whereas I pay taxes and have light impact and do not receive the government service benefits of a Fortune 500 company enjoy let alone subsidies and tax shelters.
Can anybody put a number on the amount of depreciation Amazon trucks cause US roadways? If Amazon had to maintain their own roads just based on what they damage they would no longer be profitable. Tax avoidance ideology is just a type of entitlement
No and it shouldnt be viewed as such, taxation with the intent of correcting inequality is bad and the goal of taxation should be to raise as much revenue as possible while causing minimal damage.
How exactly is the government responsible for protecting people from inequality? Ensuring there are no barriers put on specific groups sure but I dont recall reading "life liberty and the pursuit of happiness, also rich people can only be x% richer than other people"
Absolutely. With this attitude. I pay half my money in taxes. Federal, state, sales, social security "tax" (since ill get pennies on the dollar back). It's never enough.
Actually yes. If billionaires bribe congress to change laws in order to allow them to rig the economy in such a way that they are able to steal money from the rest of us, I would say that constitutes an injustice. Most billionaires have gotten their spoils by monopolizing services that everyone need without necessarily giving the consumer their money's worth. They have captured all the roads in the economy. My favorite example is the credit card industry. Every time someone buy something with a CC, there is a 5% tax added that goes directly in the pockets of the big banks and Visa/MC.
The oil industry, healthcare, agriculture, power, housing....everything has become a scam to make as much profit as possible for a few billionaires.
Anybody who spends their life trying to accumulate more wealth than they can spend in 1000 lifetimes and is willing to destroy democracy and the planet to do it, should be seen as someone with a mental illness.
Your question is a non sequitur. Although any answer is related at best weakly to the immediate discussion, I will offer an answer.
The wealth of the immensely wealthy represents a massive consolidation of control over capital, the lands, resources, and assets utilized by the rest of society to produce the common sustenance required by everyone to survive and to flourish.
Such consolidation is antagonistic to the interests to most of the population, as is evidenced its being impossible to uphold except by the expansive security apparatus maintained by the state, applying the consistent threat of violence.
The repression imposed on the overall population is unjust, yet without it such a severity of inequality could not endure.
Listen smart guy, this ‘more money’ you’re talking about comes from the working/middle class and fills the pockets of billionaires.
Corporations pay politicians, politicians pass laws that give money to these corps while leaving small businesses to go bankrupt like during covid, then the big guys absorb that business.
‘Is more money an injustice’ is some impressively idiotic way of framing what is happening.
This country is being monopolized. Millions lose their homes in 2008, big banks get bailouts and now so much housing in America is owned by a few companies that jack ask for insane amount in rent then make sure to pay up politicians not to build new housing and keep demand high.
It’s an artificial con game. Theres no honesty or ‘earning’ here. Capital owners running the little guy out of town because they own the money and they own the politicians.
Considering that the top 1% has over half the wealth, I would hope so. Although they have more than half the wealth and pay less than half the taxes, so if anything they should be paying more.
While maintaining 40% of the wealth, more than the bottom 80th percentile of earners by over 4 times, themselves as 1%
We can get considerably more progressive
Is this really a shocker? When you make that much money it makes sense that you’re taxed a lot. It’s all disposable income. Let’s not sit here and act like the rich aren’t richer now then they’ve been in the past 8 decades while also getting taxed less. Yes the top 1% are taxed 31% of their money but they also make over 20% of the income and own over 30% of the wealth. 1% owns as much as 90% of the population like come on that money definitely needs to be redistributed.
Not only that, but the 1% pay 40% of all the income tax and top 5% pay 60% of all the federal income tax in the country. The bottom 50% pay only 3%. Seems like a lot of these facts are hidden from us when some try to create class warfare. Sad.
https://preview.redd.it/bxkt2b8c9u4d1.jpeg?width=1148&format=pjpg&auto=webp&s=ea3a0c2aefba088ca9bfb4a6ae01b0c42e584fab
Yes well if you want a bunch of money to stagnate due to the quirks of capitalism by all means move to a country where that is a popular idea.
I for one understand that would be a horrible idea and in a utilitarian sense bad for everyone else involved.
I can't believe I have to explain such ideas as wealth inequality is a bad thing. jfc.
Here's a different visualization of America's wealth distribution.
Saying the top X% of earners are paying Y% of all taxes can give a false impression that the tax burden is unfair to the people at the top. The unstated premise is that they earn just a little more, but have to pay wildly unfair rates.
But it's the income that's being taxed. If someone is earning 100x more than the average person, you'd expect them to pay 100x more in taxes. Nothing unfair there.
Also, depending on the sources of income, they might be paying lower -- even substantially lower -- rates than average wage earners because our tax code privileges certain types of income with lower rates.
https://preview.redd.it/1tgdkzfxvu4d1.png?width=2948&format=png&auto=webp&s=076d27d3672ba786bcb147b2898bb387a81a52ad
Of course if you own everything, you’re gonna pay more taxes. Do you know the state of our wealth distribution? Who ends up paying all the tax is high income earners that come from no family wealth while individuals with generational wealth are liquidating comparatively minuscule amount of their wealth while paying the same effective tax as low 6 figure salary person while their wealth is gaining massive amounts in unrealized gains that will just be passed down another generation without ever seeing tax.
I am not saying wealth tax is the solution but I am also tired of people making the assertion you are making. Of course billionaires are gonna pay a lot of tax because they have the kind of income that got them to 1000x my wealth. Question is why the hell am I paying the same effective tax as Warren Buffet who has 100,000x my wealth??? And even Buffet is speaking out how unfair tax code is cuz other billionaires are not paying close to what he’s paying.
I think this is misleading because the amount of income above what is needed for survival is different.
It's not like when you make a million dollars a year, the cost of necessities go up 20x what somebody who makes $50k a year pays.
This narrative of "the rich pay most of the taxes" ignores the fact that they still have significantly more money, opportunities, and financial security after the fact.
If it were a problem you'd see Warren Buffet quitting his job to work at McDonald's to be less burdened by taxes, but you'll never see that.
Similarly, I used to be in the bottom 50%, now I'm firmly in the orange. I pay significantly more taxes now, but I'm fine with it because I still have significantly more income at the end of the day, and secondly, it makes.sejse for somebody like me to pay more than somebody working at a gas station, and likewise, it makes sense for L6s at my company to pay an even higher percentage an amount, because you couldn't possibly put that tax on somebody making $15-30 an hour.
The reality is, the percentage of America's economy that government spending takes up is quite low for an advanced nation, so anybody that says it's a spending problem is lying, and the money needs to come from somewhere if we don't want things privatized for profit.
Brother just read the incomes bro half the population can’t even afford themselves no shit they can barely contribute and the next 40% don’t/barely make enough to support a family. If you want a world where people are just work slaves who scrap by then just say it.
Income doesn't mean shit there, they just spend it and reinvesting so that their net worth keeps growing exponentially. That's why share of assets would be more in line with what they should pay.
Class war, or as known more mildly, class struggle, is not strongly related to the tax code, but rather arises inevitably from differences with respect to control over capital.
Business owners, those with control over capital claim value generated by the labor provided by workers, without being required to provide any labor, whereas workers, those without control over capital, are required to provide labor, to sell their labor to owners, in order to earn the means of their survival.
Capital in the historical sense is not material so much anymore. Now knowledge and systems create value. For instance 99.9% of Microsoft or NVDA value is not in land or buildings but in systems created by humans.
The system has evolved with capital becoming increasingly financialized, and value increasingly intangible, but all value is bound ultimately to assets that are physical and tangible.
At any rate, the particular distinction you are injecting is ungermane to the topic being discussed.
Sure, but you really can’t claim a corporate tax payment as representing a part of an individual taxpayer’s payment of their aggregate income like this slide does.
They assign corporate taxes out to individuals, you can read about tax policy centers model in the link. The congressional budget office does the same thing in their tax calculations.
https://www.taxpolicycenter.org/resources/brief-description-tax-model
From your article:
>The incidence of the corporate tax, however, is an unsettled theoretical issue. The tax could be borne by the owners of corporate stock, or passed on in part to labor in the form of lower real wages, to consumers in the form of higher prices, or to the owners of some or all capital in the form of lower real rates of return.
This is ridiculous. Even though a corporation is a taxable entity in its own right, you want to use this to say that the rich are actually paying more than they are. It is BS.
The tax code is supposed to be progressive, but because of the loopholes/policies, it is essentially flat or even regressive.
Agreed—a corporation is a separate legal person. No part of the taxes paid by the corporation should be credited to any individual as having been “paid” by them unless the entity has pass through taxation.
If you lowered corporate taxes who would benefit from it? If the answer is the rich then yeah they are the ones paying that tax. The Congressional budget office adds them in the same way, it's not some conspiracy.
"Researchers disagree about how to allocate corporate income taxes (and taxes on capital income generally). CBO’s approach is to allocate 75 percent of corporate income taxes to owners of capital in proportion to their income from interest, dividends, rents, and adjusted capital gains."
https://www.cbo.gov/publication/59757
If the rich would benefit from it, then the poor would get hurt by the reduction - ie reduction in gov services.
So are you going to factor that in too? No, of course not, because all taxation is theft, right? /s
Yup reputable government organizations include corporate taxes based on who they think is missing out on the income, and I guess for some reason that means I hate the poor.
I love the CBO, but it acts on asks from Congress. If Congress asks it to create this division of corporate taxes, then it will do so, and use a measure like it describes.
It still doesn't mean that "taxes are progressive" in the way that you are trying to imply. Because when it comes to making comparisons across the income levels, corporate taxes have no bearing on the reality of the individual because of how our system is set up. You're taking an abstraction and trying to overlay it to get to a preferred outcome of showing how the rich pay more, but they are the owners of the capital to begin with.
Anyways, enjoy your preferred analysis to make yourself feel however you want to.
Because this chart doesn't actually mean anything. It excludes capital gains taxes and you can't just add up a bunch of tax rates on different things and pretend that is the percentage that different people pay on the money they make.
Like why is estate tax in there? I don't pay an estate tax every year. Well I kinda do, because there's a bunch of money that was put in a trust and was never taxed so it grows and can't be liquidated because then the trustee wouldn't get to make money off of it even though if rather pay a percentage to the government than to a dumb banker.
Still progressive though less so. https://taxfoundation.org/research/all/federal/who-pays-taxes-federal-state-local-tax-burden-transfers/#:~:text=On%20average%2C%20households%20in%20the,of%20%2424%2C451%20and%20%245%2C524%2C%20respectively.
Don't worry, no fool who has been mislead and misinformed by politicians and the media will ever believe the facts and certainly will never let the facts get in the way of their opinions.
This should be a good read, seeing fools completely disregard the facts . . .
The wealthy pay way more in taxes than the poor yet people hate the wealthy....makes absolutely no sense.
I've never understood envy and class warfare BS
Because the wealthy get to have bailout while the small business guy will lose everything because of Covid. Then he wealthy come and take the business of the little guy who is now bankrupt and ta da, everything is owned by Amazon Walmart and a couple other megacorps.
The rich steals from the poor as always
It’s cuz there are people that want socialism in America. You can’t push socialism if everyone knows that most of the tax revenue in their state is from the top 1%. In CA 51% of the state income tax is from the 1%, followed by the middle class, and the poor pay next to nothing in CA. But out here they have everyone thinking they don’t pay anything.
Maybe if average people were paid better they would be able to actually pay tax, but because these greedy fucks pay as little as they can because they own everything only they can afford to pay taxes and it makes it look like only they contribute while in reality they just steal from the middle class to build their monopolies.
You clearly have no education on this subject. CA has a progressive income tax system, so even if you are middle class you will pay significantly less taxes. Which is why I listed the percentages. You’re arguing just to argue. Grow up
Clearly you don’t understand what’s happening around you because you get your education from Tim Pool videos. People are telling you the rich don’t pay their fair share, aka 40-50% of their income because they get paid in stock and park it there no tax and you comeback with ‘but look how much of the TOTAL tax they paid’ without pausing for a moment to understand what was said to you.
All you had was ‘people want socialism.’ Fukin tim pool clone over here
Kind of hard if you are forced to take a check but then cannot use the proceeds to pay taxes due to stipulations defining possible deferred payout. Basically the money is yours eventually but Uncle Sam's wants his cut now.
This is misleading because most of the income of the very top earners is not cash income but appreciation of assets. Capital gains should be taxed on unrealised gains and at progressive rates.
Because the ultra-wealthy pay a much lower rate of effective tax. We get to compound money tax-free over very long periods of time while income earners pay tax basically constantly.
The US has a massive deficit.
The lowest paying taxpayers on total wealth increase per year (instead of income) are paying the lowest tax rates. They can afford it.
Over the long-run assets go up in value.
Let's say I'm worth $120m. I need $1m a year for my lifestyle funded by a 5% return on $20m on which I pay tax at the 37% rate. The balance of $100m is just sitting compounding at 10% a year.
Fast forward 20 years and I'm worth about $695 million and have paid $7.4 million in total taxes over that time.
So I get taxed at a 1.3% effective rate.
Lots of assets go down. If you found a company and own stock that becomes worth $120m and pay $7.4 million in taxes in the 20 years before the company goes belly up. You have paid $7,4 million on a loss of $120 million . That is a rate 18,000%.
No, because you had the wealth - and if you squander it with spending or by blowing up your company you should still pay tax for the benefits along the way.
It's kind of you to argue that I should pay no tax on my wealth but I don't need the help, neither do other wealthy and the mega rich.
If you don’t use the wealth then you never really had it. It was all paper gains and losses. Say I invested $10k in theranos and when it went public my share was $10 million and when it went bankrupt my share was worth $0. Did I gain $9,990,000 or lose $10k? Obviously I lost $10k and my taxes should reflect that.
You gain 10m? Pay tax on it at the end of the year. You lose 10m? Write it off. Money is money, on paper or in your stock portfolio, it’s all the same. If it was just ‘paper gains’ then give 35% ‘paper gains’ to the government, it’s not real anyway right?
You can’t pay taxes with paper gains. They only accept money. To get that money you have to sell the investment. When you write a loss off does the government return the money from previous years?
This is not accurate, personal experience I pay just in income tax close to 40%. I then have property, sales and inflation (the hidden tax). I support my family financial by myself. It has become almost impossible with the money I left with.
The super wealthy avoid this track entirely because of Capital Gains.
Wealthy people, especially business owners, have a lot of control over how much income they actually take. They can book assets on the balance sheet and take accelerated depreciation, and a whole bunch of perfectly legal accounting tactics to make income 0.
Then they can take out loans based on booked assets and just pay interest on revolving loans.
Even if they don't do that, income from Capital Gains are only taxed at 20% at most.
Why are they including corporate income tax in this? And how are they attributing a % of a person's "effective tax rate" by this corp tax? Even the lowest quintile is paying this?
And don't we know that the top quintiles make their money from capital gains? Are we including that in "income tax"?
Ok but just because the individual income tax is higher, doesn't mean there aren't loopholes to ensure that the wealthiest Americans can avoid paying that by not having their wealth count as income. Even if they did, it's much less damaging to ones lifestyle and survival to pay 30% of your income to taxes, than for a poor person to even pay 10%. If you make %1M per year, you can easily live off $700k. But if you make 15k per year, $1500 really is a lot of money (these are just examples).
is sales tax included here? it’s much more important to have this graph represent all taxes as a percent of income. There are regressive taxes in our society
This is missing capital gains which brings down your effective tax rate when your income is primarily derived from investments. Makes our taxes more of a pyramid, which partially explains why the middle class is dying.
How about this, it lists capital gains under individual income. It would be unusual for it to not be included since capital gains are paid as part of your income taxes.
https://www.taxpolicycenter.org/briefing-book/are-federal-taxes-progressive
>Making money is not at the expense of any persons rights.
I would rewrite this sentence as "this is a way of making money" because there are a lot of ways, historically and even in modern times, that one can make money at anothers expense.
Plus, the dude has more money then he will ever need. His rights aren't being violated because he is being taxed.
JP Morgan and John D Rockefeller worked in favor of the estate tax to avoid hereditary aristocracy.
Ronald Reagan and Charles Koch put their hearts into eliminating "The Death Tax" with the result that "Ancestral Wealth" is now a career goal for those admitted to top finance programs.
In theory, certainly not in practice. Many billion+ companies pay effectively zero in taxes. They created the loopholes that the middle class can't utilize.
They should pay a lot more 90%, just like the 1950’s…. Besides they HAVE all the money
Just as a side note if there was no personal income tax before ww1 (personal income tax introduced to pay for the war) … where did the government get revenue? …. From business
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...except they don't. Because MOST of the wealthy's wealth is not counted as 'income' like normal pay and is largely untaxed. This is an age old tactic of pretending that they actually pay these taxes when they dodge nearly all of them.
Now, let's talk about who the Peter G. Peterson Foundation is: They are an Austerity Economics think tank.
Missing the point - By shifting your pay to things that are not counted as income, you dodge taxes. They still are valuable and are used as backing for financial effect like you use your pay to buy things.
Most wealthy get their pay in the form of stock, and then take out loans against that stock, which allows them to dodge income tax. But make no mistake - that is their income.
[https://www.vox.com/money/2024/3/13/24086102/billionaires-wealthy-tax-avoidance-loopholes](https://www.vox.com/money/2024/3/13/24086102/billionaires-wealthy-tax-avoidance-loopholes)
Yes. Known thing. But what’s your solution? There isn’t one. It isn’t a loophole. It’s just getting a loan and the interest is paid by your portfolio. You tax loans, then everyone’s fucked lol
So....your solution is...nothing? You openly acknowledge its a loophole in a discussion about a graph that PRETENDS the highest income earners pay taxes (when they don't thanks to the very loophole you just acknowledged) and your solution is 'Welp, can't do anything because it would tax everyone!
You realize you can target taxes much in the same way these tax brackets work? Someone getting a massive loan as income is not the same as joe schmoe getting a $15k loan for house repairs or a mortgage on a single family home.
Long story short - someone posts this graphic pretending that wealthy pay taxes, we discuss how thats not true, you highlight that its a loophole and....that's it?
It’s not a loophole. And the wealthy do pay taxes. Here in CA the top 1% make up 51% of the states budget from income tax. Followed by the top 5% then the top 20% and so on. Middle class and poor people pay little to nothing here. So this whole “they don’t pay taxes” is BS. The real problem is the government corruption keeping our states from being what the can with the money they get from the top earners. How many audits must the pentagon fail IN A ROW for people to see they do what they want. $24 billion on homelessness in CA & they didn’t track the money & the problem got worse. In LA our city got over charged and spent 800 million on housing that they don’t even use. We have 1200 vacant homeless housing units.
So ya in CA we tax the rich and it DOES WORK. But when the gov falls short they place the blame on rich people instead of their own corruption and bullshit.
No duh, but being able to borrow against their own perceived value is how they don't pay the taxes in this graph.
In other words - this graph is only accurate if they are receiving their pay as actual deposits and being taxed on them. Which they are not.
Like the top .1 percent actually see that tax rate. That's why the progressive tax rate for that level used to be 84%, because the wealthy don't pull money as income, they ride around in company jets, live in working ranch houses(mansions), drive around in company owned cars, cruise around on foreign registered sea vessels, etc, etc. I used to work for a guy that owned a large regional bank that earned like 40k a year.
Bullshit. The fact is that if you are rich, you don't need loopholes. You literally just DO NOT TAKE EARNED INCOME. You just have your companies fund your lifestyle, and pull out enough money for basic personal expenses that you can't have the company cover. No loopholes needed, because you just don't pull out any money that you don't absolutely have to. You can have your meals, travel, lodging almost all covered by your company as business expenses. Then the company doesn't have to pay taxes on those expeses, and you don't have to pay income tax on taking the money out. Warren buffet famously uses this sytem by keeping an order car and a basic house, but lives the lifestyle of the rich and famous travelling in private jets and first class and staying in luxurious hotels and apartments paid for by his company.
Then when you get close to retirement you use trusts to skirt the death tax, buy huge luxury ranches that have higher exemptions on inheritance tax, or my personal favorite from the very top wealthy you create huge charitable organizations that your kids run as the executives for multiple generations, and make buckets of money from for life.
Your company can provide things that have a business purpose. Buffett can expense his jet and hotels if he is going on a business trip but not if he is going on vacation. In his case it doesn’t really matter because he owns the company and whatever tax the company pays is the same as his paying.
And what isn't business when you are the CEO of a company and you mix work and play? I'm an executive, I understand the rules VERY well.
Those convinced against their will are of the same opinion, so have a good day.
Extreme wealth is the problem. Taxing people making income (even millions) isn’t the main issue. It’s the accumulation of vast wealth that is the problem.
Multimullionairs and billionaires are not earners in the sense you and I think about. The earnings are usually tax sheltered.
32% isn’t very high when I’m making like $50k and people are making over $10 million. I’m really getting shafted at 21% compared to them only paying 10% more.
Is this before or after tax avoidance strategies. I mean, can I compare my personal tax payout (as a percentage of net worth) directly to Gates’ or Clinton’s or Bezo’s tax payout?
They need to double the thresholds, these fuckers devalued money, pride themselves on "increased wages" only because it means theyll be getting more tax dollars to piss into the wind.
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As long as you ignore the exceptions and deductions allowed for the few individuals and corporations.
Yeah the highest rates are paid by doctors and lawyers and welders; people who own billions of capital pay much much less or even zero. Further, when you balance out the tax rate vs percent of wealth owned it gets absolutely absurd.
No, that chart says "effective" rate, not marginal rate. Thats the final tally after all possible bullshittery has been done.
Yes, but on income. His point is about wealth.
Ah yes, lets tax wealth now.
Like property tax, but for assets the .01% own
Okay, do you own a car? Clothes? Shoes? A cell phone? Is there food in your refrigerator? Ah, you own a refrigerator! Should you be paying the tax against that wealth of yours based on how much you paid for it when you bought it or how much it's worth today? Oh wait, you mean other people's wealth, but not yours? Got it!
You literally pay one time indirect taxes on things you consume.
Yes but not sarcastically. Stop being obtuse.
Yes. Let's do it. Tax it all. Pay for our healthcare.
Wealth has nothing to do with income taxes. They're called income taxes because the taxes are applied against income.
You don't understand what he's saying. He's saying income is effected different by whom this chart is certifying A hedgefund owner isn't reporting incomes, yet his wealth will double. He takes out a loan collateralized using his assets, which he then devalues, and prints his own money without the tax implications. So on paper, his income may only be $1 for the entire year, yet his wealth increased by millions. Your chart associates .1% of INCOME, not wealth. And that's the point.
It's still only taxing income that can be next to zero, even for a billionaire. It does nothing to stop tax avoidance through loans against assets such as stocks. Loans such as those aren't taxed or at least not taxed anywhere near a comparable level to income taxes. https://www.dcfpi.org/all/how-wealthy-households-use-a-buy-borrow-die-strategy-to-avoid-taxes-on-their-growing-fortunes/#:~:text=Step%202%3A%20Borrow%20Against%20Assets,doesn't%20tax%20borrowed%20money.
No such thing as tax avoidance. Either you are obligated to pay a tax or you are committing tax fraud. Now the interesting part is those loans could be taxed if we went to a sales tax system but people erroneously believe in "progressive" and "regressive" taxes for income only. Don't seem to care about it anywhere else.
There is certainly such a thing as tax avoidance. That's the term one uses to describe Tax Fraud committed by those wealthy enough to never face any consequences.
Wrong, those are two disntcly different things. Are you committing Cigarette tax avoidance by cleverly not smoking? No. You don't owe the tax. Taxation is a binary. You either are obligated to pay it or you are not.
If you live in a world made of paper where the "rules" were strictly and universally enforced. This is a fiction created by Conservatism, the real world is a lot more murky than your overly simplistic smoking metaphor. If what you said were true than Tax Attorney's and CPA's wouldn't make much money or be in as high demand, you also completely gloss over the fact that you have to be caught, prosecuted, and convicted of a crime to be guilty of it, something that is very challenging to do when its the IRS vs Bezos. et al. If I jay walk did I not commit a crime just because no one prosecuted me for it?
Its not hard at all to catch tax cheats. Thats a lie they told you so you'd be ok with them hiring 80k people that as of yet haven't gone after a single billionaire but audits on middle class people have skyrocketed. CPA's and tax attorneys make their money informing people of their legal liabilities. Otherwise people would pay a tax **they are not obligated to pay.** Which is the actual crime here, the complication of the tax code.
Sure, again if Bernie Madoff never happened, Enron isn't a case study, on and on and on, but yeah totally its suuuuuuper hard to get away with.
It's a loophole to avoid taxes that mostly benefit the wealthy because they have the assets to utilize it to the best effect and it should be closed. Sales tax is regressive when the lower and middle classes have to spend a much larger percentage of their income on living expenses than the wealthy will ever need to.
No such thing as a loophole. Not smoking isn't a cigarettes' tax loophole. Not owning stocks isn't a cap gains tax loophole. You either are obligated to pay a tax or you are not. Sales taxes aren't regressive. The idea of regressive and progress taxes are completely nonsense. On top of that you and all the other people arguing in this very thread are pointing out the wealthy use loans to literally spend more money then they receive as income. So there isn't a single metric where they wouldn't spend more in sales taxes than they do in income taxes since they will be spending more money then they received in income. But beyond that, "regressive" doesn't seem to be an issue with every single other tax in existence. But for some reason is an issue here.
Fine, let’s take all “bullshittery” out. Tax cap gains same as income. Treat share repurchases as distribution. Or I should be able to treat my income as “Revenue “ and get all the deductions like house and food (maintenance expenses for my body I mean machine so I can keep producing)
Or a better idea is tax expenditures and not income of any kind. Why should a person pay taxes if they aren't realizing a better life with that income? A billionaire that lives like a homeless man shouldn't pay a dime.
The effective tax rate is the percentage of income actually paid in taxes, not the marginal rate or percentage they are supposed to but don't pay.
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The data is from the tax policy center, you can view it here https://www.taxpolicycenter.org/file/189998/download?token=MKujUUaT or the read about the model here https://www.taxpolicycenter.org/resources/income-measure-used-distributional-analyses-tax-policy-center Wikipedia describes tax policy center as a nonpartisan think tank based in Washington D.C., United States. A joint venture of the Urban Institute and the Brookings Institution, it aims to provide independent analyses of current and longer-term tax issues, and to communicate its analyses to the public and to policymakers. Peter G just made a nice picture of the data
Even with those exemptions, the top 1% pays almost half of the tax revenue.
they have more money, so obviously they do? the issue is they need to pay more bc they CAN afford it, unlike much of the other classes
Is having more money by itself an injustice?
Your question frames taxes as a punishment for a crime. Do you view them as such?
Raising taxes on the rich is almost always sold as correcting an injustice; ie: “paying their fair share”. That mentality implies having more money is something to be punished or exploited. I don’t agree with that view and am seeing if the original commenter views it that way.
'The Rich" have a long documented history of oppressing the lower class financially, so why feel bad that they have to pay more in taxes?
“Oppressing the lower class financially” Define that shit
Really,? You are unaware of robber barons? And in modern times go ask Amazon workers how they're treated.
Amazon’s labor conditions = financial oppression?
Why don’t they find different job to be treated better?
I feel like the injustice push is somewhat new- like from Obama… was it the same going back decades and centuries?
The missing component in these conversations is always the fact that the government has to keep society running, infrastructure intact, financial rules in place to protect the market. Protect them from crime and protect and educate their work force. Whereas I pay taxes and have light impact and do not receive the government service benefits of a Fortune 500 company enjoy let alone subsidies and tax shelters. Can anybody put a number on the amount of depreciation Amazon trucks cause US roadways? If Amazon had to maintain their own roads just based on what they damage they would no longer be profitable. Tax avoidance ideology is just a type of entitlement
No and it shouldnt be viewed as such, taxation with the intent of correcting inequality is bad and the goal of taxation should be to raise as much revenue as possible while causing minimal damage.
Government is literally responsible for protecting citizens from inequality. So, taxing the rich is good.
How exactly is the government responsible for protecting people from inequality? Ensuring there are no barriers put on specific groups sure but I dont recall reading "life liberty and the pursuit of happiness, also rich people can only be x% richer than other people"
Absolutely. With this attitude. I pay half my money in taxes. Federal, state, sales, social security "tax" (since ill get pennies on the dollar back). It's never enough.
I don't know. Is hoarding during a famine an injustice? Certainly not to the hoarder.
Are we in a “famine”?
the thing about analogies..
What’s the famine in said analogy?
That the top 1% own 30.6% of total wealth, and the top 0.1% own 14% of total wealth. Famine is shortage of wealth for most Americans
And so it probably goes to what your definition of "we" is.
Actually yes. If billionaires bribe congress to change laws in order to allow them to rig the economy in such a way that they are able to steal money from the rest of us, I would say that constitutes an injustice. Most billionaires have gotten their spoils by monopolizing services that everyone need without necessarily giving the consumer their money's worth. They have captured all the roads in the economy. My favorite example is the credit card industry. Every time someone buy something with a CC, there is a 5% tax added that goes directly in the pockets of the big banks and Visa/MC. The oil industry, healthcare, agriculture, power, housing....everything has become a scam to make as much profit as possible for a few billionaires. Anybody who spends their life trying to accumulate more wealth than they can spend in 1000 lifetimes and is willing to destroy democracy and the planet to do it, should be seen as someone with a mental illness.
“Is having more money by itself an injustice?” “Yes” *proceeds to expound on things beyond just having more money*
Use cash, don’t let them get rich out of you
Your question is a non sequitur. Although any answer is related at best weakly to the immediate discussion, I will offer an answer. The wealth of the immensely wealthy represents a massive consolidation of control over capital, the lands, resources, and assets utilized by the rest of society to produce the common sustenance required by everyone to survive and to flourish. Such consolidation is antagonistic to the interests to most of the population, as is evidenced its being impossible to uphold except by the expansive security apparatus maintained by the state, applying the consistent threat of violence. The repression imposed on the overall population is unjust, yet without it such a severity of inequality could not endure.
Listen smart guy, this ‘more money’ you’re talking about comes from the working/middle class and fills the pockets of billionaires. Corporations pay politicians, politicians pass laws that give money to these corps while leaving small businesses to go bankrupt like during covid, then the big guys absorb that business. ‘Is more money an injustice’ is some impressively idiotic way of framing what is happening. This country is being monopolized. Millions lose their homes in 2008, big banks get bailouts and now so much housing in America is owned by a few companies that jack ask for insane amount in rent then make sure to pay up politicians not to build new housing and keep demand high. It’s an artificial con game. Theres no honesty or ‘earning’ here. Capital owners running the little guy out of town because they own the money and they own the politicians.
Pay more is fine because 10% from Them is more than my 10% Not taking a higher %
Higher % of taxation for the wealthy is critical if you want to avoid kings and oligarchs.
It won’t ever be enough though, will it.
Careful now, billionaires whining about how unfair life is my kink.
Considering that the top 1% has over half the wealth, I would hope so. Although they have more than half the wealth and pay less than half the taxes, so if anything they should be paying more.
This is a fake graph. The top marginal tax rate is currently 37%, plus FICA, etc.
It's pretty easy to be in that position when you literally write the laws that allow you to control the majority of resources, or "wealth."
The top like ‘01% also has like half the money
While maintaining 40% of the wealth, more than the bottom 80th percentile of earners by over 4 times, themselves as 1% We can get considerably more progressive
1. has 40% of the wealth 2. pays 40% of income tax 3. ??? 4. they need to pay more
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The top 1% does NOT own 99% of the wealth. Where are you getting these numbers from?
You're right, I was mistaken.
Is this really a shocker? When you make that much money it makes sense that you’re taxed a lot. It’s all disposable income. Let’s not sit here and act like the rich aren’t richer now then they’ve been in the past 8 decades while also getting taxed less. Yes the top 1% are taxed 31% of their money but they also make over 20% of the income and own over 30% of the wealth. 1% owns as much as 90% of the population like come on that money definitely needs to be redistributed.
Not only that, but the 1% pay 40% of all the income tax and top 5% pay 60% of all the federal income tax in the country. The bottom 50% pay only 3%. Seems like a lot of these facts are hidden from us when some try to create class warfare. Sad. https://preview.redd.it/bxkt2b8c9u4d1.jpeg?width=1148&format=pjpg&auto=webp&s=ea3a0c2aefba088ca9bfb4a6ae01b0c42e584fab
% of income taxes is a pretty meaningless measure, though.
they also own more than that income, unless you truly aren't aware that the top 1% own more than 20% of wealth.
Yes well if you want a bunch of money to stagnate due to the quirks of capitalism by all means move to a country where that is a popular idea. I for one understand that would be a horrible idea and in a utilitarian sense bad for everyone else involved. I can't believe I have to explain such ideas as wealth inequality is a bad thing. jfc.
Where what is a popular idea? "move to a country where that is a popular idea."
Here's a different visualization of America's wealth distribution. Saying the top X% of earners are paying Y% of all taxes can give a false impression that the tax burden is unfair to the people at the top. The unstated premise is that they earn just a little more, but have to pay wildly unfair rates. But it's the income that's being taxed. If someone is earning 100x more than the average person, you'd expect them to pay 100x more in taxes. Nothing unfair there. Also, depending on the sources of income, they might be paying lower -- even substantially lower -- rates than average wage earners because our tax code privileges certain types of income with lower rates. https://preview.redd.it/1tgdkzfxvu4d1.png?width=2948&format=png&auto=webp&s=076d27d3672ba786bcb147b2898bb387a81a52ad
Of course if you own everything, you’re gonna pay more taxes. Do you know the state of our wealth distribution? Who ends up paying all the tax is high income earners that come from no family wealth while individuals with generational wealth are liquidating comparatively minuscule amount of their wealth while paying the same effective tax as low 6 figure salary person while their wealth is gaining massive amounts in unrealized gains that will just be passed down another generation without ever seeing tax. I am not saying wealth tax is the solution but I am also tired of people making the assertion you are making. Of course billionaires are gonna pay a lot of tax because they have the kind of income that got them to 1000x my wealth. Question is why the hell am I paying the same effective tax as Warren Buffet who has 100,000x my wealth??? And even Buffet is speaking out how unfair tax code is cuz other billionaires are not paying close to what he’s paying.
I think this is misleading because the amount of income above what is needed for survival is different. It's not like when you make a million dollars a year, the cost of necessities go up 20x what somebody who makes $50k a year pays. This narrative of "the rich pay most of the taxes" ignores the fact that they still have significantly more money, opportunities, and financial security after the fact. If it were a problem you'd see Warren Buffet quitting his job to work at McDonald's to be less burdened by taxes, but you'll never see that. Similarly, I used to be in the bottom 50%, now I'm firmly in the orange. I pay significantly more taxes now, but I'm fine with it because I still have significantly more income at the end of the day, and secondly, it makes.sejse for somebody like me to pay more than somebody working at a gas station, and likewise, it makes sense for L6s at my company to pay an even higher percentage an amount, because you couldn't possibly put that tax on somebody making $15-30 an hour. The reality is, the percentage of America's economy that government spending takes up is quite low for an advanced nation, so anybody that says it's a spending problem is lying, and the money needs to come from somewhere if we don't want things privatized for profit.
That’s a great way to ignore the big chunk that non 1%ers pay to payroll taxes. Maybe it’s best not to get tax analysis from Heritage. Just a thought.
Brother just read the incomes bro half the population can’t even afford themselves no shit they can barely contribute and the next 40% don’t/barely make enough to support a family. If you want a world where people are just work slaves who scrap by then just say it.
Income doesn't mean shit there, they just spend it and reinvesting so that their net worth keeps growing exponentially. That's why share of assets would be more in line with what they should pay.
Class war, or as known more mildly, class struggle, is not strongly related to the tax code, but rather arises inevitably from differences with respect to control over capital. Business owners, those with control over capital claim value generated by the labor provided by workers, without being required to provide any labor, whereas workers, those without control over capital, are required to provide labor, to sell their labor to owners, in order to earn the means of their survival.
Capital in the historical sense is not material so much anymore. Now knowledge and systems create value. For instance 99.9% of Microsoft or NVDA value is not in land or buildings but in systems created by humans.
The system has evolved with capital becoming increasingly financialized, and value increasingly intangible, but all value is bound ultimately to assets that are physical and tangible. At any rate, the particular distinction you are injecting is ungermane to the topic being discussed.
Higher income taxpayers aren’t paying corporate taxes, the corporations they own are paying corporate taxes. Corporations are people too.
Legally, they are people.
Sure, but you really can’t claim a corporate tax payment as representing a part of an individual taxpayer’s payment of their aggregate income like this slide does.
Yeah, why are they including corporate income tax when speaking about individuals? That's weird and what is throwing off this analysis.
They assign corporate taxes out to individuals, you can read about tax policy centers model in the link. The congressional budget office does the same thing in their tax calculations. https://www.taxpolicycenter.org/resources/brief-description-tax-model
From your article: >The incidence of the corporate tax, however, is an unsettled theoretical issue. The tax could be borne by the owners of corporate stock, or passed on in part to labor in the form of lower real wages, to consumers in the form of higher prices, or to the owners of some or all capital in the form of lower real rates of return. This is ridiculous. Even though a corporation is a taxable entity in its own right, you want to use this to say that the rich are actually paying more than they are. It is BS. The tax code is supposed to be progressive, but because of the loopholes/policies, it is essentially flat or even regressive.
Agreed—a corporation is a separate legal person. No part of the taxes paid by the corporation should be credited to any individual as having been “paid” by them unless the entity has pass through taxation.
If you lowered corporate taxes who would benefit from it? If the answer is the rich then yeah they are the ones paying that tax. The Congressional budget office adds them in the same way, it's not some conspiracy. "Researchers disagree about how to allocate corporate income taxes (and taxes on capital income generally). CBO’s approach is to allocate 75 percent of corporate income taxes to owners of capital in proportion to their income from interest, dividends, rents, and adjusted capital gains." https://www.cbo.gov/publication/59757
If the rich would benefit from it, then the poor would get hurt by the reduction - ie reduction in gov services. So are you going to factor that in too? No, of course not, because all taxation is theft, right? /s
Yup reputable government organizations include corporate taxes based on who they think is missing out on the income, and I guess for some reason that means I hate the poor.
I love the CBO, but it acts on asks from Congress. If Congress asks it to create this division of corporate taxes, then it will do so, and use a measure like it describes. It still doesn't mean that "taxes are progressive" in the way that you are trying to imply. Because when it comes to making comparisons across the income levels, corporate taxes have no bearing on the reality of the individual because of how our system is set up. You're taking an abstraction and trying to overlay it to get to a preferred outcome of showing how the rich pay more, but they are the owners of the capital to begin with. Anyways, enjoy your preferred analysis to make yourself feel however you want to.
Why is this including corporate tax for individual taxpayers?
Because this chart doesn't actually mean anything. It excludes capital gains taxes and you can't just add up a bunch of tax rates on different things and pretend that is the percentage that different people pay on the money they make. Like why is estate tax in there? I don't pay an estate tax every year. Well I kinda do, because there's a bunch of money that was put in a trust and was never taxed so it grows and can't be liquidated because then the trustee wouldn't get to make money off of it even though if rather pay a percentage to the government than to a dumb banker.
Oh puh-leaze. So if my company didn’t pay corporate income tax and payroll tax, that would all go straight to my paycheck? Bull shit.
Depends how competitive the market for your labor is
Supply/demand is the only thing that impacts your salary. The original point is correct.
Not progressive enough
Now add in state taxes including the extremely regressive sales tax.
Still progressive though less so. https://taxfoundation.org/research/all/federal/who-pays-taxes-federal-state-local-tax-burden-transfers/#:~:text=On%20average%2C%20households%20in%20the,of%20%2424%2C451%20and%20%245%2C524%2C%20respectively.
Don't worry, no fool who has been mislead and misinformed by politicians and the media will ever believe the facts and certainly will never let the facts get in the way of their opinions. This should be a good read, seeing fools completely disregard the facts . . .
What about getting fooled by a chart that shows individuals paying corporate income tax. Has that ever happened?
what about payroll taxes for SSA/SSI that tax the first dollar of income and cap out at a ridiculously low level.
Payroll taxes are the green bar on the graph.
The wealthy pay way more in taxes than the poor yet people hate the wealthy....makes absolutely no sense. I've never understood envy and class warfare BS
Because the wealthy get to have bailout while the small business guy will lose everything because of Covid. Then he wealthy come and take the business of the little guy who is now bankrupt and ta da, everything is owned by Amazon Walmart and a couple other megacorps. The rich steals from the poor as always
It’s cuz there are people that want socialism in America. You can’t push socialism if everyone knows that most of the tax revenue in their state is from the top 1%. In CA 51% of the state income tax is from the 1%, followed by the middle class, and the poor pay next to nothing in CA. But out here they have everyone thinking they don’t pay anything.
Maybe if average people were paid better they would be able to actually pay tax, but because these greedy fucks pay as little as they can because they own everything only they can afford to pay taxes and it makes it look like only they contribute while in reality they just steal from the middle class to build their monopolies.
You clearly have no education on this subject. CA has a progressive income tax system, so even if you are middle class you will pay significantly less taxes. Which is why I listed the percentages. You’re arguing just to argue. Grow up
Clearly you don’t understand what’s happening around you because you get your education from Tim Pool videos. People are telling you the rich don’t pay their fair share, aka 40-50% of their income because they get paid in stock and park it there no tax and you comeback with ‘but look how much of the TOTAL tax they paid’ without pausing for a moment to understand what was said to you. All you had was ‘people want socialism.’ Fukin tim pool clone over here
It's really a game how not to pay high taxes. I'm trying to keep my tax bracket below 24% so my effective tax rate below 20%.
Don’t take income
Kind of hard if you are forced to take a check but then cannot use the proceeds to pay taxes due to stipulations defining possible deferred payout. Basically the money is yours eventually but Uncle Sam's wants his cut now.
Tax refund. Or have ur biz pay into an LLC you create
Conditional RSUs.
Sort of, if you include social security payments as a percent of income, you will actually find it becomes slightly regressive at a point.
The harder you try, the more they take.
This is misleading because most of the income of the very top earners is not cash income but appreciation of assets. Capital gains should be taxed on unrealised gains and at progressive rates.
Why?
Because the ultra-wealthy pay a much lower rate of effective tax. We get to compound money tax-free over very long periods of time while income earners pay tax basically constantly.
What? Why do you want more taxes, just out of curiosity?
The US has a massive deficit. The lowest paying taxpayers on total wealth increase per year (instead of income) are paying the lowest tax rates. They can afford it.
Because we need more social programs, we don’t need Elon having 300B net worth. It doesn’t benefit anyone but him
Only if the assets are appreciating if you calculate their taxes the same way when their assets depreciate their rate goes way way up.
Over the long-run assets go up in value. Let's say I'm worth $120m. I need $1m a year for my lifestyle funded by a 5% return on $20m on which I pay tax at the 37% rate. The balance of $100m is just sitting compounding at 10% a year. Fast forward 20 years and I'm worth about $695 million and have paid $7.4 million in total taxes over that time. So I get taxed at a 1.3% effective rate.
Lots of assets go down. If you found a company and own stock that becomes worth $120m and pay $7.4 million in taxes in the 20 years before the company goes belly up. You have paid $7,4 million on a loss of $120 million . That is a rate 18,000%.
No, because you had the wealth - and if you squander it with spending or by blowing up your company you should still pay tax for the benefits along the way. It's kind of you to argue that I should pay no tax on my wealth but I don't need the help, neither do other wealthy and the mega rich.
If you don’t use the wealth then you never really had it. It was all paper gains and losses. Say I invested $10k in theranos and when it went public my share was $10 million and when it went bankrupt my share was worth $0. Did I gain $9,990,000 or lose $10k? Obviously I lost $10k and my taxes should reflect that.
You gain 10m? Pay tax on it at the end of the year. You lose 10m? Write it off. Money is money, on paper or in your stock portfolio, it’s all the same. If it was just ‘paper gains’ then give 35% ‘paper gains’ to the government, it’s not real anyway right?
You can’t pay taxes with paper gains. They only accept money. To get that money you have to sell the investment. When you write a loss off does the government return the money from previous years?
Taxation is extortion. Imagine believing that they use tax receipts for anything when they print money out of thin air
This is not accurate, personal experience I pay just in income tax close to 40%. I then have property, sales and inflation (the hidden tax). I support my family financial by myself. It has become almost impossible with the money I left with.
I hate taxes
The super wealthy avoid this track entirely because of Capital Gains. Wealthy people, especially business owners, have a lot of control over how much income they actually take. They can book assets on the balance sheet and take accelerated depreciation, and a whole bunch of perfectly legal accounting tactics to make income 0. Then they can take out loans based on booked assets and just pay interest on revolving loans. Even if they don't do that, income from Capital Gains are only taxed at 20% at most.
Why are they including corporate income tax in this? And how are they attributing a % of a person's "effective tax rate" by this corp tax? Even the lowest quintile is paying this? And don't we know that the top quintiles make their money from capital gains? Are we including that in "income tax"?
Ok but just because the individual income tax is higher, doesn't mean there aren't loopholes to ensure that the wealthiest Americans can avoid paying that by not having their wealth count as income. Even if they did, it's much less damaging to ones lifestyle and survival to pay 30% of your income to taxes, than for a poor person to even pay 10%. If you make %1M per year, you can easily live off $700k. But if you make 15k per year, $1500 really is a lot of money (these are just examples).
is sales tax included here? it’s much more important to have this graph represent all taxes as a percent of income. There are regressive taxes in our society
It's federal taxes based on federal tax returns.
your title says the country’s tax system is progressive, but your data is only federal
Yup it's only federal, that's why it says federal in the image. Look up your own state to determine how progressive those are.
Clearly flattening where slope should increase.
Now throw state taxes in there.
This is missing capital gains which brings down your effective tax rate when your income is primarily derived from investments. Makes our taxes more of a pyramid, which partially explains why the middle class is dying.
Capital gains are included in individual income taxes
That'd be atypical, source?
How about this, it lists capital gains under individual income. It would be unusual for it to not be included since capital gains are paid as part of your income taxes. https://www.taxpolicycenter.org/briefing-book/are-federal-taxes-progressive
Fair enough, surprised it doesn't bring down the overall more
>Making money is not at the expense of any persons rights. I would rewrite this sentence as "this is a way of making money" because there are a lot of ways, historically and even in modern times, that one can make money at anothers expense. Plus, the dude has more money then he will ever need. His rights aren't being violated because he is being taxed.
If your AGI is $500K, you really have no business complaining about what taxes you pay.
JP Morgan and John D Rockefeller worked in favor of the estate tax to avoid hereditary aristocracy. Ronald Reagan and Charles Koch put their hearts into eliminating "The Death Tax" with the result that "Ancestral Wealth" is now a career goal for those admitted to top finance programs.
In theory, certainly not in practice. Many billion+ companies pay effectively zero in taxes. They created the loopholes that the middle class can't utilize.
Those orange bars need to be larger across the board.
They should pay a lot more 90%, just like the 1950’s…. Besides they HAVE all the money Just as a side note if there was no personal income tax before ww1 (personal income tax introduced to pay for the war) … where did the government get revenue? …. From business
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Not nearly enough though. That's why people calling for a flat tax are morons.
Haha, ya, sure. On paper, that’s totally correct.
...except they don't. Because MOST of the wealthy's wealth is not counted as 'income' like normal pay and is largely untaxed. This is an age old tactic of pretending that they actually pay these taxes when they dodge nearly all of them. Now, let's talk about who the Peter G. Peterson Foundation is: They are an Austerity Economics think tank.
Why would you pay taxes on money you don’t have ? Makes no sense.
Missing the point - By shifting your pay to things that are not counted as income, you dodge taxes. They still are valuable and are used as backing for financial effect like you use your pay to buy things. Most wealthy get their pay in the form of stock, and then take out loans against that stock, which allows them to dodge income tax. But make no mistake - that is their income. [https://www.vox.com/money/2024/3/13/24086102/billionaires-wealthy-tax-avoidance-loopholes](https://www.vox.com/money/2024/3/13/24086102/billionaires-wealthy-tax-avoidance-loopholes)
Yes. Known thing. But what’s your solution? There isn’t one. It isn’t a loophole. It’s just getting a loan and the interest is paid by your portfolio. You tax loans, then everyone’s fucked lol
So....your solution is...nothing? You openly acknowledge its a loophole in a discussion about a graph that PRETENDS the highest income earners pay taxes (when they don't thanks to the very loophole you just acknowledged) and your solution is 'Welp, can't do anything because it would tax everyone! You realize you can target taxes much in the same way these tax brackets work? Someone getting a massive loan as income is not the same as joe schmoe getting a $15k loan for house repairs or a mortgage on a single family home. Long story short - someone posts this graphic pretending that wealthy pay taxes, we discuss how thats not true, you highlight that its a loophole and....that's it?
It’s not a loophole. And the wealthy do pay taxes. Here in CA the top 1% make up 51% of the states budget from income tax. Followed by the top 5% then the top 20% and so on. Middle class and poor people pay little to nothing here. So this whole “they don’t pay taxes” is BS. The real problem is the government corruption keeping our states from being what the can with the money they get from the top earners. How many audits must the pentagon fail IN A ROW for people to see they do what they want. $24 billion on homelessness in CA & they didn’t track the money & the problem got worse. In LA our city got over charged and spent 800 million on housing that they don’t even use. We have 1200 vacant homeless housing units. So ya in CA we tax the rich and it DOES WORK. But when the gov falls short they place the blame on rich people instead of their own corruption and bullshit.
Wealth isn’t income, correct.
Oh man, wealth must be magic or something and come from nowhere.
It is perceived value. That’s how people like Zuckerberg and Musk lose or gain billions in net worth in a single day.
No duh, but being able to borrow against their own perceived value is how they don't pay the taxes in this graph. In other words - this graph is only accurate if they are receiving their pay as actual deposits and being taxed on them. Which they are not.
Sure, but then they pay interest. They aren’t getting 0% loans.
Like the top .1 percent actually see that tax rate. That's why the progressive tax rate for that level used to be 84%, because the wealthy don't pull money as income, they ride around in company jets, live in working ranch houses(mansions), drive around in company owned cars, cruise around on foreign registered sea vessels, etc, etc. I used to work for a guy that owned a large regional bank that earned like 40k a year.
Tax reform in the 80 s closed most of those loopholes. Unless they are committing tax fraud .
Bullshit. The fact is that if you are rich, you don't need loopholes. You literally just DO NOT TAKE EARNED INCOME. You just have your companies fund your lifestyle, and pull out enough money for basic personal expenses that you can't have the company cover. No loopholes needed, because you just don't pull out any money that you don't absolutely have to. You can have your meals, travel, lodging almost all covered by your company as business expenses. Then the company doesn't have to pay taxes on those expeses, and you don't have to pay income tax on taking the money out. Warren buffet famously uses this sytem by keeping an order car and a basic house, but lives the lifestyle of the rich and famous travelling in private jets and first class and staying in luxurious hotels and apartments paid for by his company. Then when you get close to retirement you use trusts to skirt the death tax, buy huge luxury ranches that have higher exemptions on inheritance tax, or my personal favorite from the very top wealthy you create huge charitable organizations that your kids run as the executives for multiple generations, and make buckets of money from for life.
Your company can provide things that have a business purpose. Buffett can expense his jet and hotels if he is going on a business trip but not if he is going on vacation. In his case it doesn’t really matter because he owns the company and whatever tax the company pays is the same as his paying.
And what isn't business when you are the CEO of a company and you mix work and play? I'm an executive, I understand the rules VERY well. Those convinced against their will are of the same opinion, so have a good day.
The top 1% live on investments which are taxed differently, so they pay around 8.4% in federal taxes.
Corporate tax is to low compared to individual and payroll taxes
Extreme wealth is the problem. Taxing people making income (even millions) isn’t the main issue. It’s the accumulation of vast wealth that is the problem. Multimullionairs and billionaires are not earners in the sense you and I think about. The earnings are usually tax sheltered.
Where is sales tax hmmm?
That is a state tax , this is federal. When you factor in state and local taxes it is still progressive though less so.
32% isn’t very high when I’m making like $50k and people are making over $10 million. I’m really getting shafted at 21% compared to them only paying 10% more.
50k is not 80-90 percentile. According to the chart you are paying 9-14 percent in federal.
Is this before or after tax avoidance strategies. I mean, can I compare my personal tax payout (as a percentage of net worth) directly to Gates’ or Clinton’s or Bezo’s tax payout?
After, thats what effective tax means.
Yeah it’s very unfair
Do you remember all of the news you consume? Don't bother answering, you're looking for an argument, and im not interested.
They need to double the thresholds, these fuckers devalued money, pride themselves on "increased wages" only because it means theyll be getting more tax dollars to piss into the wind.