Poor families pay double the state, local tax rate of the rich

http://www.msn.com/en-us/money/taxe...e-state-local-tax-rate-of-the-rich/ar-AA89Iu0

Finally, scientific proof that the wealthy are screwing us all.

Right?

Well, maybe not.

Let's talk about what an "effective" tax rate is. Your "effective" rate is, generally speaking, how much tax you pay compared to how much money you make. For example, if you make $10,000 and have a tax bill of $1,000 your "effective rate" is 10%. Now, I said "generally speaking" earlier because our tax code is rather complex and the actual calculation isn't that straight forward. For example, non-taxable Social Security benefits usually aren't counted as income for this kind of calculation.

With that out of the way, we look at the article which includes sales tax and property tax in their calculation. What they are saying is that the poor are more significantly impacted by a flat sales tax percentage or property tax rate than the wealthy are. This seems to be a perfectly reasonable argument. If Citizen A makes $100 and pays 7% sales tax on a $10 item that's a .07% "effective" tax rate. likewise, if Citizen B who makes $1,000 buys the same product and pays the same percentage it's only .007% of his income. This, the article argues, creates a 10:1 advantage for the wealthy citizen and, on it's face, that's an accurate statement.

If we look a little further, however, we'll see that this isn't really a tax issue at all. The same principle applies to everything that the "poor" citizen spends money on. If he buys a $5 pair of shoes he's paying an "effective rate" of ten times what the wealthy citizen did so making this out to be a tax matter is simply intellectually dishonest. If we were going to apply this standard fairly then the cost of absolutely everything would need to be scaled to income, right?

One more thing. Like I said before, the "effective" tax rate is more complex than just a ratio of tax to income. It's actually tax to taxable income and that's an important distinction. Our tax system excludes a certain amount of income from taxation. For example, a single person without kids will exclude the first $10,150 they make from income before calculating their income tax. If Citizen A makes $25,000 they will exclude more than 40% of their income from taxation while Citizen B who makes $100k only gets to exclude 10% of his income. Why isn't there a cry for "fairness" in this?

 

Regardless of what percentages you use $1000 is more than $100,000.

Rich people pay more, ok, it's a indisputable fact.

This scam is the weakest of all liberal scams because even some ghetto hood rat elementary school dropout should be able to understand that $1000 is more than $100,000.

Besides these poor people are going to get every penny refunded so not only did they pay less initially, the end up paying nothing at all when the book closes.

 

BS thread and BS study. YES, sales tax is regressive, by design. It would be entirely unworkable and uncollectable otherwise. Notice how the lie mongers frame it as "state and local taxes" instead of what we are really talking here SALES TAXES. Are you stupid enough to be fooled by this? I'm not.

The only possible policy solution to the regressivity of sales tax is doing away with it entirely. But this is NOT what the Complex wants, far from it, so they lie, lie and lie some more to create a false resentment narrative appeal to what they really want to do, raise INCOME taxes on THE MIDDLE CLASS. They know that they can't get enough from "the rich" to fund their growth, so they are hoping that you are stupid enough to buy that "the rich" will pay most of these tax increases as opposed to the middle class. Are you stupid? I'm not.

We could just as easily say that the poor pay far more gasoline, liquor and cig taxes, other regressive consumption based taxes. We could just as easily, and far more honestly, lump in sales taxes with those other consumption taxes, but then we start to see the truth, those taxes are high because government NEEDS them to be and WANTS them to be, not because of any class warfare injustice foisted on us by the rich.

 

What if the millionaire used half of his income to fund after school tutoring for inner city youth and cancer research? Should he still be taxed on the whole million? What if the person who made $25k spent that money on cigarettes and beer while living on their mother's couch and eating the food she bought? Should that $25k still be untaxed?

 

Let's cut to the chase, here, shall we? Here it is:

C'mon, people, everybody knows that the wealthy have been waging an incredible successful class warfare on everyone else, especially the middle and lower classes. You can dust it, re-paint it, or call it anything you like, but those who have the money have the power and they are using both to their advantage. Nothing new here, and until those who are being screwed finally wake up, ain't nothin' gonna change.

 

The most regressive tax, the most disgusting tax, hits the low income workers the hardest. That's the tax that the liberals love the most. FICA. Roosevelts Legacy. The people who pay no income tax aren't the rich. That would be the loyal Democrats on the bottom.

 

That is absolutely right -- a $5 pair of shoes costs a poor guy 10x more of his income than the same pair of shoes does to the guy making 10x more.

So, given that the costs of items like shoes already take 10x more of a poor guy's income compared to the richer guy, why on earth would you say it is "intellectually dishonest" to note the same phenomenon about a regressive sales tax?

Because it is "fairness" that a poor family trying to get by on $25,000 pays a lower, not higher or the same, effective tax rate than a billionaire. If the poor family has to pay a 20% effective tax rate, it means they do without basic necessities. If a billionaire has to pay a 40% effective tax rate, it means he might have to get a little smaller megayacht.

But since you brought it up, the poor family has to pay 7.65% on every dime he makes in FICA taxes. Or 15.3% if you include what the employer pays first.

The trust fund baby, on the other hand, living off the interest from the portfolio he inherited from daddy, doesn't have to pay a dime in FICA taxes. And while the poorer guys have to pay an income tax rate *on top* of the FICA taxes that eventually goes up to 39.4%, the trust fund baby's maximum tax rate on his investment income is only 20%.

Why isn't there a cry for "fairness" in this?

 

I can't speak for other "libs" but I've certainly never said I love the FICA tax. I would be more than happy to ditch it altogether and fund Medicare and SS with higher income taxes instead.

 

What's the point of working your tail off in order to make more money if you can't buy more or better things than the guy on Welfare? As for sales taxes - or taxes in general - call out the democrats, they're the ones who are in love with them.

 

Sure. The guy with the larger income pays more for being an American than the other guy does. That income is credit for providing value to other people, for putting value into our economy.

The more value you provide, the higher your penalty for doing so.





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How is it a lie? The study plainly states that the state and local taxes depend on sales tax. Where is the lie? Gotta love how you twist the narrative by insinuating others are stupid, when you seem to be the one floating the lie.

 

So a guy who takes in $100 million a year and has to pay 25% in taxes and only ends up with $75 million income, is "punished" compared to the family that is trying to get by on $25k a year and pays no tax?

I'll take the "punishment" please!

 

I can't believe I just saw this. You do realize that sales taxes are state and local taxes, right? Are you kidding me with this?

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Oh really? So let me get this straight- poor people get back all the sales taxes they pay? Go back and read the OP and the article. Thanks.

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I can't believe he even wrote that. That was blatant ignorance of what sales taxes are.

 

By the Government? Yes. The first person is having part of his income taken from him while the other person is not.

 

You'd rather pay $25 million than pay nothing? *shrug* You're welcome to volunteer it. You can take that deal any day you wan to.





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Are you not able to buy more things than someone on welfare?

This post makes no sense at all.

 

Why did I write in my post that would cause you to ask me that?

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You'd rather try to raise your family on $25k than the "punishment" of only getting $75 million? *shrug* You can take that deal any day you want to.

I'd rather have the "punishment"

 

Good for you. Me, I'll take the "punishment".

 

I'm glad we were able to establish that one person is being punished and the other is not. You were asking the question as if you didn't know that.

 

The penalty for speeding isn't get a new car and pay $500. How you reach that mark is all on your shoulders. The penalty is what you're asked to pay. In this case $25 million for one guy, zero for another.

You're welcome to take the first guy's penalty any day of the week.




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I certainly don't consider having a $75 million after tax income as being a "punishment" compared to having a $25,000 one. Hence my use of quotation marks with the word "punishment."

If you don't understand the significance of that punctuation, and you apparently do not based on your post, let me know and I'll refer you to a punctuation resource.

 

So you don't consider the government taking 25 million dollars away from one person as punishment compared to them not taking anything away from another?

 

And end up with only $75 million in after tax income? Hell yeah I'll take that "penalty." You can take the $25k income and avoid your "penalty". Tho' as the OP goes, you're still going to get "penalized."

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I certainly don't consider having a $75 million after tax income as being a "punishment" compared to having a $25,000 one. I'll take that "punishment" any day.​

 

I haven't needed proof of that in decades. When rich people get together with other rich people to write the tax code, and when those rich people have rich lawyers and rich accountants and rich actuaries in the room with them, the last thing on their minds is tax equity. It's how we came up with the idea that the return on a dollar invested should be taxed at a lower rate than a dollar sweated for.

 

His arrogance and hatred is over the top. That's why he will continue tripping over his own message. Playing this game of words as a smoke screen to attack policies without adequate explanation, other than to attack the policy itself by saying we need to get rid of this policy or that policy, doesn't tell us a thing.