Free Markets, Free People

Tax the rich? Check out these charts

Stephen Moore does yeoman’s work via the Manhattan Institute debunking the left’s class warfare mantra of “tax the rich”.  He does it with thousands of words accompanied by many charts.  I’m just going to concentrate on a few the charts (do read the piece, it’s good) since they tell the story quite succinctly.

Remember it’s about those nasty rich paying their “fair share”:

For instance, we’re constantly told by those who would tax us more that we’re woefully under taxed compared to the rest of the world (like that’s a good reason to raise taxes).  Well that really depends on what income group you’re in, doesn’t it:

Who taxes

So it’s not really true if you’re among the upper 10% in this country is it?

Who is so under taxed then.  Well if you look at the tax rolls you’ll find that almost 40% of those filing tax returns had zero or negative tax liability.

That’s right, they paid nothing or actually got money from the government.  I’m not talking about a tax refund either.  I’m talking about redistributed wealth.

The United States taxes the top 10% of its “richest” people more than anyone else and well above the average tax found in all OECD nations.

That sort of takes the starch out of the “fair share” nonsense that we constantly hear the left prattle on about doesn’t it?

But wait, there’s more as the old Ronco commercial used to say.  What about the share of taxes collected.  It’s about “fair share”.  Surelyshare tax they’re not really paying what any thinking adult would consider their fair share of taxes are they?  Well I don’t know about you, but yes, I think they are.  In fact, the top 1% are paying twice as much in taxes as they were in 1980.   That seems to go against the conventional wisdom, or at least the claims of the left, doesn’t it?

Why yes, it does.  The chart at the right also shows that the  top 20% are paying 84% of all income taxes collected.   I don’t know what you consider a “fair share”, but I’d guess for most we’re way beyond fairness with this structure.

Well wait a minute you say, they have so  big a share of the national income that they should pay more.  Should they?  Who paid

How much more?  And where does fairness enter the question.  Looking at this next chart on the left, why should those on the higher end pay more than they are now given the information available?  If you have the bottom 50% paying 3% and the bottom 40% paying nothing or getting money via redistribution, yet benefiting from the infrastructure that the left likes to use to claim “you didn’t build that”, who really did build it?

Those paying 3% or those paying 40%?  The government has no money and can’t build anything without taxes so who paid to build all thatRecession and rich infrastructure that President Obama likes to claim?  The chart tells that story, doesn’t it.  In fact the top 25% of taxpayers ought to be yelling back at him every time he says that, “well we paid for it”.

There are a ton more examples and charts.  There’s one more I want you to see as the left continues to point to taxes on the rich as some sort of panacea to all the revenue shortfalls that ail us (btw, it’s not about revenue, it’s about spending).

Look at what the recession has done to the “golden goose” of the rich.

Oh, my … they’ve actually seen huge percentage drops.  Note how many there are in the bottom rung ($200k and above).  Sorry folks but that simply isn’t “rich” in the terms I think of rich.  That’s likely to be the guy next door who has a family of 5 and is trying to make ends meet.  Anyone who thinks $200k is rich isn’t living in the same world as I am.  But many of those in that category are going to be the small-business owners and entrepreneurs that help drive the economy.

The plan?  Tax them even more.  In France, since their tax the rich scheme has been unveiled, the “rich” are looking across borders into friendlier countries.  We’ve seen a reduction in all categories of “rich” since 2007.  Do you suppose those in those categories now are going to lay back and just accept more taxation without trying to do something to hold on to their hard earned money?

Anyway, rant ends.  Read the whole thing.  Peruse the graphs.  It is very interesting and telling information. 


Twitter: @McQandO

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51 Responses to Tax the rich? Check out these charts

  • Spain Predicts 4.3% Increase in Tax Revenues, Actual Results are 3.5% Drop; Proposed “Solution” is More Tax Hikes

    Really, how many models do you need to dispel the Collectivist delusion?

  • So a chart that excludes ALL federal taxes EXCEPT Income taxes is valid?

    Income taxes are less than 50% of total federal tax receipts, try again using complete data.

    Hey, why not just include only capital gains taxes, I’ll bet your story will look even better, since 97% of capital gains taxes are paid by people making more than $75,000 a year, and 80% are paid by people making over $200k.

    The bulk of federal revenues come from two sources, income tax (47%) and payroll tax (36%) and if I wanted to make a devious and misleading tax argument, I could include ONLY payroll taxes and exclude other taxes and make the opposite case being made here,

    “In fact, the top 1% are paying twice as much in taxes as they were in 1980.”

    This is the MOST devious sentence in this post. It implies that individuals in the top 1% pay MORE than they used to when it fact it is the opposite, the effective federal income tax rate as well as the capital gains tax is significantly LOWER than it was in the past, but as a group, the top 1% pays a larger percentage of the total INCOME TAX revenues.

    A thinking person would ask, how is that the tax rates have gone down for the top 1% and yet they are paying a larger percentage of the total burden?

    There are really only two possible answers, the other 99% are either paying a lower rate or they have less income relative to the top 1% between the comparative time frames. In fact, both of these are true.

    The other thing that bothers me is the focus on the lower incomes in this class warfare rant. In fact, if you look at the data, the lower income people, other than having a lowering income, have a pretty good deal on taxes. The top 1% have a pretty good deal as well, since they pay virtually no payroll taxes and they get sweet deal on capital gains income. The tax system really punishes people in the middle, people making from around $70k to $130k in earned income. They pay full earned income tax rates (for the most part) on their income, and they pay the full payroll tax on all or most of their income, and a group have relatively small capital gains. This is why Obama can accurately say that middle class families pay a larger percentage if their income in federal taxes than Mitt Romney who pays the capital gains on almost all of his income and pays the payroll tax on none of his income.

    If I were ranting, I would not rant about the poor not paying their fair share, nor would rant about the top 1% paying too much, I would rant about the middle income people who are getting between them.

    • ZOMG, what a despicable liar.
      It is PERFECTLY valid to consider INCOME TAXES alone, since that is what you COLLECTIVIST PHUCS are militating to raise.
      (Well, not counting all the HIDDEN taxes the Obamic Decline has built into the system.)

      • “It is PERFECTLY valid to consider INCOME TAXES alone”

        That is ridiculous, let me show you why.

        TAXES are TAXES, money taken from you by the federal government is still taken, whether you call it income tax, payroll tax, or dumbass tax (aren;t you glad they don’t have the latter)

        If I paid 16% in federal taxes on my income that money is still taken by the federal government.

        Regardless of whether it was ALL income tax, ALL payroll tax, or a combination of the two.

        If you want to have a tax fairness discussion, then you have to look at all taxes, not just the one being raised. You would ONLY exclude all other taxes if you want to skew the whole picture.

        It is true that the top 1% paid 40% of all INCOME taxes, but INCOME taxes were only 42% of all federal revenues in 2010, payroll taxes account for 40%.

        What this means is that the top 1% pays 16.8% of all federal revenues in the FORM of Income taxes. And how much of the nations income do they earn? About 22%.

        Do the math.

        If we created a tax called the dumbass tax, and it only applied to you, you would pay 100% of the dumbass tax. Would that mean that you were taxed to high or too low? We don’t know, we’d have to look at all the taxes. You might pay a 50% dumbass tax, but a 0% genius tax.

        You WANY to argue ONLY income taxes because that supports your assertion, but it is an invalid assertion unless it is considered in the context of all federal taxes.

        Payroll taxes in the 50’s were only about 10% of all federal revenues, corporate taxes were about 30%, and income taxes were around 40%.

        Now, corporate taxes are around 10%, payroll taxes are around 40%, and income taxes are around 40%.

        So who pays payroll taxes, and who doesn’t?

        Who pays income taxes, and who doesn’t?

        You can only have an honest discussion about taxes when you look at taxes in their entirety.

      • It’s also valid because the benefits of payroll taxes are limited by INCOME LEVEL.
        Quite telling just how ignorant the left is: can’t fathom dynamic situations, ignorant of law, tax law, economics, history, science…
        Progressive: one who is stuck back in a primitive, tribalistic mindset.

        • “It’s also valid because the benefits of payroll taxes are limited by INCOME LEVEL”

          That is neither true nor valid. Billionaires receive the benefits of payroll taxes just like anyone else.

          The key here is that it is a TAX.

          The top 1% pay 16.8% of federal revenues and earn 22% of all income.

    • Man, you ARE reaching – you’re becoming quite an, uh, individual, lately.
      “In fact the top 25% of taxpayers ought to be yelling back at him every time he says that, “well we paid for it”.  McQ
      “people making from around $70k to $130k in earned income.” – You
      You’re trotting out a group of people and pretending they’re not, effectively, in the very groups he’s writing about – that is, the top 25% of tax payers – all so you can get your EVIL 1% ISN’T PAYING THEIR FAIR SHARE! argument in.  Geeze, I didn’t think you were a talking points guy, but you know what?
      you think this 70 – 130k group is, what?  The poor?  when the median income for the country is less than $46k?
      Are we supposed to be stupid?   – clue – McQ is ranting about those of us paying taxes versus those of us who AREN ‘T.
      YOU’RE the one playing the class warfare game of getting all exercised about rich Mitt Romney and the 1% – how much of their flucking money will make you happy?  How much of their flucking money will FIX the problem?    And no, no fear, I’m safely in the class you’re all worried about there, that 70 – 130K class, so I’m not trying to protect my own personal ass-ets.

  • “Are we supposed to be stupid?   – clue – McQ is ranting about those of us paying taxes versus those of us who AREN ‘T”

    The only way to make that argument is pretend that payroll taxes don’t exist.

    The group that pays neither payroll taxes or income taxes is about 20%, and these people are mostly seniors and families earning under $25.

    The whole comparison is sophistry.

    • The whole comparison is sophistry.

      No, liar.  Trying to inject extraneous BULLSHIT is sophistry, your specialty.
      “TAX THE RICH” is the subject of the post by McQ.
      NO-FLUCKING-BODY is proposing a rise in the payroll (FICA) tax.  As you well know, you lying phuc.
      Your Collective IS FLACKING for an increase in the INCOME taxes for the “rich”.  As you well know, you lying phuc.

  • The only way to make that argument is pretend that payroll taxes don’t exist.

    Payroll taxes are specific to a single, LIMITED purpose.
    That’s the last post I’ll respond to from this overgrown adolescent.

    • “Payroll taxes are specific to a single, LIMITED purpose.”

      I was waiting for someone to say that.

      Imagine Income taxes are the plaid pants and payroll taxes are the blue pants, taxes in general are the bullet, and you’re the deer.

       Imagine you’re a deer. You’re prancing along, you get thirsty, you spot a little brook, you put your little deer lips down to the cool clear water… BAM! A fu*kin bullet rips off part of your head! Your brains are laying on the ground in little bloody pieces! Now I ask ya. Would you give a fu*k what kind of pants the son of a bitch who shot you was wearing?

      Do you have a choice of whether you pay payroll taxes? No, then it’s a tax.

      Do you control the specific purpose that payroll taxes are intended for? No, then it’s a tax and it’s specific purpose is irrelevant and it can be changed without your consent.

      You pay payroll taxes that are then sent to someone else.
      You pay income taxes that are then sent to someone else.

      There difference is rhetorical, not real, otherwise payroll taxes would be in account collecting interest, right?

      • “There difference is rhetorical, not real, otherwise payroll taxes would be in account collecting interest, right?”

        So when can I expect to see a check from the gov’t. to match my SS check? And why am I getting more SS back than I paid in?

  • “much of their flucking money will make you happy?”

    I paid a net 24% of my income in federal taxes last year (not to mention 3% in state income taxes).

    I suppose I would be happiest if I paid the same rate as Mitt Romney, but considering our debt problem, I would be less happy, but feel better about the future if Mitt Romney paid the same rate as me.

    But I think you missed my point, the top 50%, top 20%, top 10% are all skewed by the top 1%, and really, the top .5%.

    The rules really are different, tax rates go DOWN as you get there.

    If the post were about how the upper ends of the middle was getting hammered in TOTAL taxes, I would do nothing but agree.

    “Man, you ARE reaching – you’re becoming quite an, uh, individual, lately.”

    I found that if I push just a little more than I need to, Raggy will type in bold and caps and type things that make me laugh.

    • “type things that make me laugh.”
      Now you’re just being naughty to no good purpose.

    • You want to pay the same rate Romney does….
      So, you going to contribute as much of your income to charity as Romney does? or will we have to get the ‘charity’ contributions from you by way of a tax that the government will redistribute to their favored groups later?

      • “So, you going to contribute as much of your income to charity as Romney does?”

        No, but not too far off (about 2/3rds of the percentage he donates), but considering the impact on my lifestyle that my contributions make compared to his, I don’t feel bad at all.

        But what has that got to do with anything? Romney pays a low effective federal tax rate because gets paid in capital gains and pays virtually no payroll taxes. Think about this for a moment, if capital gains were taxed at a higher rate than earned income, how do you think Romney would get paid? Exactly!

        • Well Cap, I’m not WORRIED about Romney, or his money, how he spends, how he invests, or how much he pays in taxes because taxing him ISN’T the answer to the problem, and you know it.  Taxing his rich friends won’t fix it, taking all their wealth won’t fix it.    The problem is spending and entitlements, not how the rich aren’t paying enough in taxes.  The math has been done, 4 thousand times over, that proves if we stripped these people bare naked, and sold the clothes off their backs after taking all their wealth we’d be able to pay for the Federal Government’s spending for about a year.
          Given that it won’t fix the problem, harping on how unfair their share is tells me people aren’t trying to SOLVE the problem, they’re just trying to get other people mad enough at greedy Romney to prevent people voting for him.  They’re trying to divide a badly divided country even further along “rich” and “poor” lines.
          Do you REALLY think your tax burden will go down 1 dime if we tax Romney, his momma, and all her bridge playing buddies at 50% or even 70% of their actual yearly income?   Do you really think it will solve the problem of spending and entitlements?
          Then why are you worried about it?  Cuz it ain’t ‘fair’?

          • “Then why are you worried about it?  Cuz it ain’t ‘fair’?”

            I have two kids whom are going to be facing a 20 trillion dollar deficit that spending cuts can’t fix.

            If I have to pay more, I’ll pay more, but before I support a tax hike that would put me even closer to 30%, I’d like to think that there is the slightest nod to fairness in this country, such that I am not the ONLY one paying.

            If we took 50% of EVERYTHING the bottom 50% own, we would raise less than the 3% hike on the highest earners.

            Why tax the very rich? Two reasons, they are taxed less than middle income folks now, which is not progressive in our otherwise progressive INCOME TAX SYSTEM (payroll taxes are regressive).

            The other reason, the same reason Willie Sutton robbed banks.

            You people are always going on and on about how you oppose the government picking winners, until they pick winners in a way you like, then you’re all for it.

          • “until they pick winners in a way you like, then you’re all for it.”
            You don’t get, you seriously don’t – how many of us commenting here and posting here do you think finish up replying to, say, Erb, don our tuxedo’s and head out the door for drinks with Mitt and Soros at the club?  How many of us here do you suppose make arrangements to attend the $35k per plate political dinners, buy Senators, influence Congresscritters and own our own stable of lawyers and lobbyists?
            What POSSIBLE reason do we have for defending the idea that the rich are probably already paying enough, that it’s not going to help, and we need to do this another way?   You think we all expect our Magnastatichetrodyne Confabulator to make us wildly rich as every household in North America buys one and so we’re trying to protect our future earnings?
            Could it be that – a) we know it’s NOT the answer anyway, and B) maybe, just maybe, it’s the principle of taxation redistribution we don’t like?
            Pause for a moment and think how stupid it is to say we’re all slavishly, wildly, in favor of stacking the deck to pick winners who aren’t us and in many cases, never WILL be us.

    • If given the choice, I’ll bet you are dumb enough to take 50% of $100K rather than 10% of $1M.

  • There is a self-identified Collectivist troll here, one that we have fully flushed out of his lying, pretension of being anything but that.
    I join Sharpshooter.

  • As soon as you can get a paycheck and option out of payroll taxes, then you can make this argument, otherwise, it is sophistry.

    What the government does with a tax is irrelevant, that it TAKES it from you is relevant.

    It is amazing that y’all have created a blind spot for something that would normally annoy the hell out of you.

    “That doesn’t count because it’s different” is what I am hearing, but there is no difference, all taxes go to pay for things that are usually not us. My federal income taxes a re a wealth transfer to spend money on things that I mostly would not agree to spend it on, same with my payroll taxes. But I don’t have choice because it’s a TAX.

    MY payroll taxes don’t go into an account for my retirement, they go to pay current beneficiaries and the leftover goes to pay the same things that the general fund (income tax) pays for, and later on, when workers are closer to being outnumbered by beneficiaries, we’ll be paying the benefits out of the general fund.

    It’s a shell game, and you guys seem to be playing the part of collectivist on this topic, acting as if the payroll tax money actually goes somewhere special.

    Look at SS and Medicare the same way you always do when you are not talking the 50% that don’t pay income taxes, then reconsider your position.

    • Well you are absolutely correct about the nature of payroll taxes and income taxes. But it does not follow that the burden for the wealthiest people should be greater than the middle class.
      In fact the only thing that matters is HOW you got your money.  If you got it from dividends then you ought not be paying high taxes for two reasons. Reason one, because it has already been taxed. And reason two. Because that is the money which we want the wealthy to use as investment capital to grow the engine of the economy.

      • “But it does not follow that the burden for the wealthiest people should be greater than the middle class.”

        I suppose if you disagree with the concept of progressive taxation, that is undoubtedly true. I do believe in progressive taxation, and so does pretty much every American.

        There are virtually no proposals that have ever been put forward in which each individual pays the same dollar amount, nor proposals where each person pays the same percentage without an income threshold that creates progressivity.

        But flat taxes with no deductions are a valid point of view, just not one I agree with.

        As to whether dividends have already been taxed, that is not necessarily so, but it is a transfer of wealth from one entity to another, and should not be treated differently than other income. There are thousands of transactions where taxed money is spent and then taxed again. Every penny in our economy has been taxed many, many times. Creating WINNERS in financial decision making by tax preferences has unintended consequences, same with capital gains preferences. Warren Buffett pointed out that if the dividend tax were eliminated and Berkshire were to implement a $1 billion dividend, he personally would receive $310 million tax free. He said this would drive his personal tax rate all the way down to 3%.

        If anyone can show me causation, hell, even correlation between capital investment and capital gains, much less a causal relationship between these tax perferences and economic  growth, I’d agree. But the reality is that there is a (supply side) theory that it stimulates growth, but out debt is not theoretical, and the relationship between overwhelming debt and poor economic growth is not even debateable. If you want to see a very clear cause and effect, look at lowering taxes for people who spend 100% of their income.

        Besides, in both cases, dividends and capital gains, when you give them preference, earning are maniulated to be distributed in these forms, which is nothing but a tax scam.

        I would be consider a zero tax on capital investment in IPO’s and genuine start ups, but I would differentiate between trading and investing.

    • Either way you slice it, I pay more in SS and income tax then then a great many other people do because of where I am in the magical brackets.
      According to the Obami and the ‘we all built it’ story, THEY are riding on my roads, landing at MY airports, shipping from MY piers and collecting food stamps, welfare and assorted other what not benefits that I pay WAAAAAAY more for than they do (soon they’ll get health insurance I paid for).   I’m not worried about the 5000 Mitt Romneys and how they should be paying more, I’m worried about the 5 million Barney McDougles who are paying practically NOTHING and in some cases are actually getting credit checks and making a buck at tax time.
      Now if you’re jealous of Mitt Romeny’s wealth, none of that is going to mean much to you.   If we take every last shiney dime Mitt has, it won’t help, and I can guarantee it won’t affect YOUR share of the payments, or MY share of the payments,  by a single penny.

    • And another thought tangent – I then should be assuming the Democrats are the REALLY FLUCKNG STUPID party, because they seem to think that it’s better to pander to the 5 million Barney’s than the 5000 Mitt’s – why?  Because they’re so keen on helping the 5 million Barneys (according to you, and them), and punishing the 5000 Mitts via wealth re-distribution.
      Yet your argument is that the 5000 Mitt’s count more, presumably because the BUY the laws they need from Congress rather than VOTE for the representatives that will give them things…..
      Yet, there’s the stupid Democratic party, worrying about those 5 million utterly useless poor people votes every year.   They MUST be Stupid Cap.
      Based on the actions of the party presently in charge, that has BEEN in charge for the country for well over 50 of the last 70 years, I’d say YOU’RE wrong about where the power is Cap.  I mean, why bother with those idiot proles if their votes really WEREN’T worth something.  I suppose they do that just out of the goodness of their shiny little Democratic hearts, huh.

      • Both parties pander to the 5000 Mitts, that’s the overriding problem that pretty much dooms us to bad policy no matter who wins.

        It’s not intentional, it’s not a conspiracy, it’s not evil, it’s just thousands of deep pockets getting small things (and a few big things) that benefit them which add up to big things that hurt the country.

        Look at ethanol, we all know it’s a sham, and yet we are still doing it, Why? Because Monsanto and others paid a lot of money for that policy, and they pay a lot of money to keep it.

        Look at our trillion dollar military budget.

        Look at the half trillion dollar prescription drug bill.

        Look at Obamacare.

        People talk about Solyndra with it’s measly half billion dollars, when the entire $3T federal government is co-opted by campaign bribes, and all it costs is about $14B each election cycle to do it.

        Obama and Romney both say what they think need to say to win, that is keep their base and capture enough of the middle to win. But the key is getting those messages out, and that takes money, and that is where the loyalties ultiimately lie. Take Obamacare, since that is something which criticism of will make you smile. The idea was health insurance for all. The actual result is a trillion dollars of taxpayer money going to private insurance companies, which considering the relatively low margins in the health insurance business will equate to about $30B in profits over ten years. The health insurance industry spent $102M over 15 months in a three pronged political strategy, one, to kill the Medical Loss Ratio provision of the bill, two, to kill the public option provision, and three, to insure the individual mandate was in the bill. So a few big companies bought $30B in new profits, prevented new government competition, and failed on the MLR, all for a measly $102M. THAT’s a good return on investment (for them). The industry was working both sides, attempting to insure that it would be a very close vote, so they only needed to really buy a few key members to hold the bill hostage to the demands of the health insurance industry.

        If the Republicans win and they are able to repeal Obamacare, what do you think they will replace it with? I guarantee it will be even MORE to the liking of the health insurance industry. And it will also have enough free market rhetoric to make is SOUND good to enough Republicans (who are already prepared to like what a Republican presents)
        to get it done. Democrats will then be screaming to repeal Romneycare II.

        The government is chess pieces to special interests, the voters are pawns.

        The sad thing is that EVERYONE KNOWS THIS, and we still can’t do a damn thing about it.

        Do you think some wet behind the ears freshman Tea Party Congress Critter can’t be manipulated by a smooth talking million dollar a year lobbyist who can make them believe that what some industry wants is exactly what he wanted to do anyway, and those campaign contributions and Hawaiian fundraisers (read vacation) won’t hurt either.

        Thinking we can vote our way to an honest government is as naive as thinking you could send an 18 year virgin boy into a brothel to put a stop to all that prostitution.

        People that go through the trouble of trying to get elected to Congress WANT power, lobbyists give it to them.

        Obama is not immune, Rand Paul is not immune, Romney is not immune, Ryan is not immune.

        Biden is immune 😉

        • Now THAT was funny.  I’m torn about Biden – he’s so goofy I just have to like him as a person.

  • In 2009 the top 1% earned 13.4% of all income and paid 22.3% of all federal taxes. The top 20% earned 51% and paid 68%. That’s from the latest CBO report (published July 2012)

    Cap complains that McQ is being ridiculous by comparing income taxes for the rich to only income taxes, then makes a ridiculous statement comparing income taxes on the rich to all federal income. Just as the government collects taxes in several ways, the rich pay taxes in in several ways. Comparing the total taxes paid by the rich to the total federal income shows they pay more. It’s true at every level, the more money you make, the higher percentage of your income goes to pay Federal taxes. Table 2 shows it clearly, the second part of Table 3 has the percentages.

    • “of all federal taxes.”
      Ah, according to Cap, you surely can’t mean ALL Federal taxes…you must only mean the ones that make his argument work.  So, when you say All, you don’t REALLY mean ALL.  Normally I would assume ALL meant the standard definition for the world, but it seems that doesn’t hold true for this thread.

    • “In 2009 the top 1% earned 13.4% of all income and paid 22.3% of all federal taxes. The top 20% earned 51% and paid 68%. That’s from the latest CBO report (published July

      This is absolutely fascinating. When I first read this, I had no doubt it was accurate, and yet it was at odds with the numbers I came up with from earlier CBO data. The income share of the top 1% can fluctuate, and oddly, the CBO and IRS have slightly different numbers. I suspect they qualify the numbers differently, but the numbers are similar. The share of the total income by the top 1% changes from year to year, for example, you show 13.4% in 2009, (although I see some cherry picking, so I will cherry pick as well and use the share of market income, which is 15.4%) but the same table shows 18% in 2008, and 20.8% in 2007 (the IRS shows 22%, but I won’t quibble). So I’ll concede to these numbers specifically and offer mea culpa’s for not using this data source in the first place.

      But that’s not what is fascinating. What is fascinating is the share of federal taxes. I simply divided income taxes by the total federal taxes, and used that percentage. I didn’t think about it, but the top 1% still has a tiny payroll tax liability (about 2.5% of the total), and that wasn’t included in my calculations, so again, I apoligize for the error.

      But the payroll tax liability would not change the general point of my assertion, it would just change the numbers slightly. So when I saw that the share of the top 1% paid in total federal taxes was 22%, it made no sense to me. If the share of income taxes was 40%, and the share of payroll taxes was 2.5%, for 2009 that would add up to 18.4% of total federal receipts. But the number in the CBO showed 22.3% and I could not figure out how I could be so far off. I looked at the raw data too find the answer. What I found was the top 1% (and every other group) were credited with a portion of corporate income taxes. It made sense, someone has to pay it. But I looked further to find out how it was credited to each group. What I learned was that the CBO credits corporate income tax to individuals based on their share of total income. That is how they arrive at the 22% number rather than the 18.4% number I came up with. I would agree that it is not fair to exclude this income entirely. However, I have read numerous posts in this very blof describing how CONSUMERS pay corporate income tax. Moreover, to the extent you can assign payment of corporate taxes to individuals, it would be a function of WEALTH, not income, in which case we have to consider to the total wealth of Americans, and specifically the top 1% which as of 2007 owned 43% of all financial wealth, and 35% of the total net worth of all Americans. This number has increased as the assets of most Americans were primarily their homes, which have dropped in value, but let’s stick with the 2007 numbers.

      So here is the bottom line:

      The top 1% which in 2009 earned 15.4% of the nations wealth paid 18.4% of total federal taxes directly.
      The top 1% which owns 43% of all financial wealth and 35% of all capital assets is credited with paying 40% of all corporate taxes (which they don’t pay, and if you disagree, I would direct you to your own comments on the subject, starting with this one… “Secondly, as we’ve said ad nauseum – corporations don’t pay taxes, their customers do. ” Bruce McQuain

      Or this one, “As a general rule, no business entity pays a tax.  They merely act as unpaid collectors of the tax, levied on the customers of the business”

      So while we have a massive budget crisis, one that will almost surely saddle our children with debt so crushing that they have virtually no chance of living as well as we have, much less better, the top 1% is paying very slightly more than their share of income, and far less than their share of wealth.

      If you are worried of them leaving the country if we raise taxes, that may be valid, but you may also want to consider how many of our children will have to leave the country if we don’t.

      In any case, to go around saying the top 1% pays 40% of taxes is still pure sophistry.

      • “This is absolutely fascinating. When I first read this, I had no doubt it was accurate, and yet it was at odds with the numbers I came up with from earlier CBO data.”
        Which you still have not provided. Despite being requested.

        The CBO shows the top 1%:
        2008: 25% 
        2007: 26.7%
        2006: 26.8%
        2005: 26.3%

        To get close to your 16.8% you have to go back to 1992, at 17% and the share of income was 12% (pretax).

        • “Which you still have not provided. Despite being requested.”

          I conceded the point and used the CBO document that Phil linked.

          I am not sure what numbers you are showing, share of income, share of taxes, rates, what?

          • As the supplemental data show, I’m using the share of total federal tax liabilities. The other number, as stated directly is share of income. Your claim was the top 1% earn 22% of income. The top 1% never earned 22% of income, the closest was 18.7% in 2007 with a 26.7% share of total federal tax liabilities.
            Your conceding the point does not change or cancel my request for your source. So can you provide your source (presuming you were not just making it up)?

          • Well Anonymous, As I said, I deferred to Phil’s source because it is a new official source. I was using a source from a NY Times article, which in turn was using Brookings data. I conceded that the CBO document is a better source.

            It shows the 2007 income share of the top 1% was 23.5%


            I am sure if it were worth the trouble, I could defend the numbers, but I don’t think it is necessary to make my point. The top 1% are not paying as great of portion as people keep pretending they are.

            As to the share of income, look on page 26 for the 2007 share of market income for the top 1%.

            It shows: Top 1% 20.8%

            20.8% is not 22% it’s close.

            As to the share of total federal tax liabilities, I disagree with the formula that the CBO uses whereby they simply credit corporate taxes to individuals based on their share of income. As we all know, corporations and their shareholders do NOT pay corporate taxes, consumers do, and while the top 1% may have the largest share of income, they do not spend their income on consumption at the fractions 100% levels that most of the lower 80% do. And if you want to argue that shareholers DO pay corporate income taxes, then I would say fine, then it is on the basis of their financial wealth holdings, so that has to be included in the discussion, The top 1% own 46% of all financial wealth in America, so why wouldn’t they pay a larger sliver of taxes based on financial wealth.

          • “And if you want to argue that shareholers DO pay corporate income taxes, then I would say fine, then it is on the basis of their financial wealth holdings, so that has to be included in the discussion, The top 1% own 46% of all financial wealth in America, so why wouldn’t they pay a larger sliver of taxes based on financial wealth.”

            1) Please stop telling me what I may or may not want to argue.

            2) Pay a larger “sliver” based on financial weath? You should explain that more, so I don’t have to make assumptions about what you mean.

            3) Explain what ‘Market Income’ is, how it is different from the income measure I used, and why it is a better measure to use.

            4) 20.8% is not 22%.

  • Here’s a pretty good explanation (description) of those members of the 40% who don’t pay federal income taxes.
    Would you like to join them?

  • There is another aspect of the ‘fair share’ policy that is ignored.  What would the ‘fair share’ have to be in order to fund the government at current levels.  USA Today gives us a clue.
    Under those accounting practices, the government ran red ink last year equal to $42,054 per household — nearly four times the official number reported under unique rules set by Congress.
    A U.S. household’s median income is $49,445, the Census reports.
    So take the red ink of $42,054 and divide it by median income of $49, 445 and you get .85.  So you’d need a median tax rate of around 85% to fully fund the government.  That ‘fair share’ would be more like tax slavery.
    USA Today source:

  • Mit Romney paid over three million dollars ($3,000,000,000) in federal income taxes in 2011. He probably also paid the maximum amount of SS tax. I submit that $3M is more than a ‘fair’ amount to pay for services rendered. All  the crap about “He pays a lower  percentage than me! Wahhh!” is pure demagoguery. When all the whiners lake CS pay even close to 10% of what he pays, then I may listen. Otherwise, it’s just ignorant, mean-spirited, envious BS.

    • But but he makes more…so…..he should pay more…somehow….that’s just….fair.    Though he doesn’t get better roads, or a better army, or a better government, he should pay more.   It’s FAIR.
      Meanwhile back at the old tax ranch, they estimate something on the order of 7 Billion (that’s right kids, Billion, with a B and followed by enough zeros to make 1 thousand millions) will be paid out to illegal, oh…my rudeness, undocumented immigrants through the tax system via child credits. But we ain’t WORRIED about THAT, even though if we took Romney’s estimated net worth, we’d be able to get .0357 % of that amount, once.  Now we could fund that 1 credit for about 6 years if we took every last dime from Warren Buffett.

    • “When all the whiners lake CS pay even close to 10% of what he pays, then I may listen. Otherwise, it’s just ignorant, mean-spirited, envious BS.”

      Think about this sentence the next time you whine about the 50% who don’t pay taxes.

      But I am glad we cleared that up, you will be perfectly fine with our tax policy, even if the country implodes under debt, as long as Romney is paying more dollars than me.

      That would put him at a rate of .002%

      I am glad we have finally found where philosophical stand is on tax rates.

      But with that point of view, you must certainly support a flat dollar amount tax for ever American, which, based on current spending would be $10,000.00 per yer, cash on the table.

      Mitt could pay it out of his pocket change, and we could put poor people in labor camps to work off their debt. Maybe you’ll be kind and you won’t make children liable until they turn 12, and if they don’t have any money, there’s always the Hunger Games. The rich are going to have a lot of disposable income, and they need to be entertained.

      I can’t think of any other to tax fairly based on your philosophy because you clearly oppose progressive taxation and apparently, your opinion is that anyone who does support progressive taxation is just mean and envious.

      • As I said before;

        “If given the choice, I’ll bet you are dumb enough to take 50% of $100K rather than 10% of $1M.”

        It’s pretty obvious you don’t really care how much  actual money is paid in taxes as long as those nasty , greedy rich folks pay a higher percentage. Our debt problem was not caused by the rich not paying enough, and it will not be solved by having the rich  pay more. I would tell you to do the math but you have proved yourself incapable Invincible ignorance and demagoguery are your strong suits.

  • “they estimate something on the order of 7 Billion (that’s right kids, Billion, with a B and followed by enough zeros to make 1 thousand millions) will be paid out to illegal, oh…my rudeness, undocumented immigrants through the tax system via child credits.”

    And where do you suppose these children receiving the credits were born?

    By the way, the law that allowed this was passed by a Republican Congress and a Republican Senate, back in 1998.

    To be fair, democrats oppose changing it now, arguing that these children ARE American citizens and should be eligible for relief.

    Besides, if their parents are illegal and working, they are paying payroll taxes which they can never receive benefits from.

    In 2009, the last year for which figures are available, employers reported wages of $72.8 billion for 7.7 million workers who could not be matched to legal Social Security numbers.

    So we’re still up.

    Personally, I really can’t fathom why the fed cannot differentiate between a real SS number and a ITIN number. It is honestly mind boggling. The only conclusion I can come up is that they don’t WANT to. It would make the hiring of illegals MUCH more difficult, or conversely, easier to prevent.

    Why do you think we don’t bother to do something that is seemingly so simple?