Taxes and Income: If Democrats really want to soak the rich, they'll keep tax rates where they are,

[133724]

Last week the Congressional Budget Office joined the IRS in releasing tax numbers for 2005, and part of the news is that the richest 1% paid about 39% of all income taxes that year. The richest 5% paid a tad less than 60%, and the richest 10% paid 70%. These tax shares are all up substantially since 1990, and even somewhat since 2000. Meanwhile, Americans with an income below the median -- half of all households -- paid a mere 3% of all income taxes in 2005. The richest 1.3 million tax-filers -- those Americans with adjusted gross incomes of more than $365,000 in 2005 -- paid more income tax than all of the 66 million American tax filers below the median in income. Ten times more.

...

The IRS statistics also tell a more complicated economic story than the media claim. First, America continues to be a society of upward income mobility. Over the past decade, millions of Americans have joined the once highly exclusive club of six- and seven-figure earners. Some 304,000 Americans earned $1 million or more in annual income in 2005, compared to 110,000 in 1996 and 176,000 in 2000. Because there is no cap on the top income share, this increase in millionaires pushes the top income (and taxes paid) share higher. The number of millionaire households in net worth also increased to nine million in 2006, up from six million in 2001, according to TNS, a global market research firm.

...

Keep in mind as well that the IRS only records the income that taxpayers report. Its data don't include income that the rich hide in tax shelters or otherwise defer. And there is evidence that lower tax rates since 1981 have caused the rich to declare more of what they earn. In 1980, when the top income tax rate was 70%, the richest 1% paid only 19% of all income taxes; now, with a top rate of 35%, they pay more than double that share. With lower rates and fewer tax loopholes after the 1986 reform, there is less incentive to shelter income to avoid tax.

...

We hate to break up the media's egalitarian chorus with these details, but facts are facts. If Democrats really want to soak the rich, they'll keep tax rates where they are, or, better, lower them some more.


http://online.wsj.com/article/SB119786208643933077.html?mod=opinion_main_review_and_outlooks


EWWWWHH.....

[rockymountaindem]

1. The WSJ continues to be a mouthpiece for the rich

In other news, the sun continues to be yellow...

[truedelphi]

7. Exactly. my bet is that a lot of those who have joined the ranks of the rich

Did so when Mom and Dad died, and left them the Real Estate that had been virtually worthless forty or fifty years ago, but now because of location, priceless. Or the farm acreage is now being encrouched by expanding cities - and therefore shooting upwards in value.

There is nothing wrong with that - but the truth is that a lot of middle class people are not going to make it upwards without that sort of thing happening.

[AX10]

2. .....

:thumbsdown:

[Justitia]

3. Oh brother! How about what PERCENTAGE of each's income goes towards taxes?

Not the overall pie, that's incredibly misleading (on purpose).

How much of each individual's income goes towards taxes is the foundation of our progressive tax system.

What transparent hacks the WSJ is comprised of.

Just for fun, a bonus question for the Murdoch fish wrap printers - how much (as a percentage of revenue) do corporations pay in income tax? And what is the historical trend? Nothing is as uniquely American as what corporations make from the sole benefit of being based in the USA.

[theoldman]

4. This is a lot of BS.

Figures don't lie but liars figure. I can guarantee you that rich people are using loopholes as much a ever. The only reason that rich people pay more taxes is because they are earning a lot more money.

[Tierra_y_Libertad]

5. $20 to a poor person is a lot of money. $200 to a rich one is lunch.

"There are three kinds of lies: lies, damned lies, and statistics" - Mark Twain

[sinkingfeeling]

6. Another piece of GOP propaganda! I just read where 'upward mobility' in the USA lacks far behind

most other top-tier countries in the world. Basically, when inflation is figured in, the number of people progressing upward (in income class) has fallen over the last 25 years.

[old guy]

8. That will teach me to check the link first.

If I would have seen the WSJ link, I wouldn't have read the rest. Think Murdoch (sp).... Faux... well you get the idea.

[NoBorders]

9. 22.9% according NYT article

"The top 1 percent paid 27.6 percent of all federal taxes in 2005, up from 22.9 percent in 2003, while the share paid by the middle fifth of taxpayers declined to 9.3 percent from 10 percent in 2003.

and this:
"The increase in incomes of the top 1 percent of Americans from 2003 to 2005 exceeded the total income of the poorest 20 percent of Americans, data in a new report by the Congressional Budget Office shows."

http://www.nytimes.com/2007/12/15/business/15rich.html?_r=1&oref=slogin

Freakin' WSJ.

[guitar man]

10. might want to consider

what the rich own percentage-wise as opposed to the rest of us.....

[Johonny]

11. Lol

"Over the past decade, millions of Americans have joined the once highly exclusive club of six- and seven-figure earners."

Hey the dollar is worth 2/3 of what it was back then, not even adjusting for inflation. You have to earn six figures in many major cities just to be middle class these days. Heck six figures can't even get you into the housing market where I am. The fact is real wages are down and Americans have less buying power than a decade ago.

If the rich are paying more taxes now than before (even with a lower tax rate) wouldn't you conclude not how great things are for everyone, but how much more money the rich have to be making now than before.

[hfojvt]

12. it's all in how you play with the numbers

WSJ: The percentage of taxes paid by the rich is higher than ever

Truth: So is the percentage of income "earned" by the rich

Truth: Because of their $100,000+ tax breaks, they are now paying an increased percentage of a smaller bill. For example, income tax revenues were 1,004 billion in 2000 and they were 927.2 billion in 2005. (to make the point better they fell from 10.4% of GDP to 8.5% of GDP) So, yeah the rich are paying a higher percentage of the smaller total bill, but they also got a larger percentage of the $206 billion in tax cuts, making them a very large beneficiary of Republican generosity.

WSJ: "In 1980, when the top income tax rate was 70%, the richest 1% paid only 19% of all income taxes; now, with a top rate of 35%, they pay more than double that share. With lower rates and fewer tax loopholes after the 1986 reform, there is less incentive to shelter income to avoid tax."

Truth: Another apples to oranges comparison. In 1980, the top 5% got 15.8% of the national income, in 2001 they got 22.4%. Yeah, you are gonna pay a higher percentage of taxes if your fucking share of income goes up.

WSJ: "First, America continues to be a society of upward income mobility. Over the past decade, millions of Americans have joined the once highly exclusive club of six- and seven-figure earners. Some 304,000 Americans earned $1 million or more in annual income in 2005, compared to 110,000 in 1996 and 176,000 in 2000. Because there is no cap on the top income share, this increase in millionaires pushes the top income (and taxes paid) share higher. The number of millionaire households in net worth also increased to nine million in 2006, up from six million in 2001, according to TNS, a global market research firm."

Truth: The rich getting richer, does not show "upward income mobility". Do not even try to make me laugh with this. Less than 2% of all households make over $250,000. If some in this elite group move from an income below $1 million to an income above it, that is hardly a Horatio Alger rags to riches story. Same for the less than 20% of households that make over $85,000.


You Wall Street Journal editors might wanna check your pants for combustion.

"In a way, this one little dumb-a$$ editorial is a microcosm of the Journal's editorial page. How much is stupidity? How much is dishonesty, and how much is the Journal's just trusting that its readers rabid ideological convictions will blind them to gaping holes in their reasoning? Hard to say." Al Franken