Here's an eye opener.....Tax rates from 1913 to 2010

[Ruffhowse]

Here's a link to Federal Income Tax rates since 1913. It's unbelievable that so many conservatives think we are taxed too heavily now. Just look at what the tax rates were in periods when our economy was very strong. Unbelievable that all these Tea Bagger idiots buy this propaganda line from the right wing.

http://www.taxfoundation.org/files/fed_individual_rate_history-20100923.pdf

[daylan b]

1. Those numbers without the corresponding changes in tax code are rhetorical gibberish.

People that think there are ways to avoid taxes now have absolutely no clue what kind of foolishness the tax code allowed during those days.

The more accurate numbers you want to look for are income tax revenue as a percentage of GDP which tax both the tax rates and the difference in tax code into account.

If you look back on many of those high top marginal tax rate years, you’ll notice that the tax revenue as a percentage of GDP was relatively the same. For example, look at the 50s with those 90%+ tax rates people like to talk about. The actual tax revenue as a percentage of GDP ranged from 14-19% during that decade. During the 2000s, it ranged betwen 15% and just 20.9%

[thetonka]

2. If you know how to play the tax game it's easy to not pay

I take my deductions, all legal, and pay 5% in federal income tax. And I am not in the lower tax brackets. I also know people who make considerable money and pay almost nothing.

The tax code today allows far to many deductions. It is too complicated and the people with the money and resources to find the best deductions do. The tax code needs to be simplified.

[daylan b]

7. If that's actually the case...

...and those with the money ane resources to find the best deductions do, why is it that the top five percent of earners are reponsible for nearly 60% of all income tax revenues?

Wouldn't they be the ones who avoid taxes if what you say is true?

[thetonka]

13. I keep seeing that, but every wealthy person I know pays very little in taxes

[daylan b]

14. You can choose to believe IRS facts or hearsay.

It's up to you.

[thetonka]

17. Lies, Damn lies and Statistics.

Statistics from the IRS are more hearsay than first hand experience with people I know.

[daylan b]

20. So you think both the Obama and Clinton administrations are/were in on it?

and that the numbers put out by the IRS for years and years are actually just a conpiracy?

and that your anecdotal evidence trumps the actual facts?

You are good at the Internet.

[thetonka]

34. Nope, its not that simple.

Do your own research, you'll figure it out.

[daylan b]

35. I have

That's why I'm calling out your lies.

You seem to be basing your entire argument on one stat you found about the top 400 earners.

[thetonka]

37. You seem to be basing my knowledge on one example

Not interested in this game today.

[daylan b]

39. You've yet to show any example of your 'knowledge' other than that.

I'd say I'm not interested in this game if I were you too.

The only thing you've claimed that is true was the top 400 earner thing and that is due to their heavily weight capital gains income.

[thetonka]

40. Never claim the 400 earner thing, just put it up as an example

Feel free to point our my "lies".

[daylan b]

41. I sent you a link via e-mail

to a report that will help you understand the subject better. It's the Tax Foundation report on who actually pays taxes, they're the same source as the OP.

It's always best to be educated on subjects you wish to discuss.

[thetonka]

42. Got it, thank you, I'll add it to the library of similar info I already have

Still not seeing where I lied.

[daylan b]

38. Here, let me simply it for you...

I had hoped you would actually find these numbers on your own and I don't know how you could have missed them. They're referenced on the Wikipedia page on this subject for heaven's sake...

Income Percentile - Combined Local + State + Federal Tax Rate
80%–100% - 34.5%
60–79% - 31.3%
40–59% - 28.2%
20–39% - 23.2%
0–19% - 13.0%

They're from the same source as the OP.

What you continue to keep saying is what is called a "lie".

[thetonka]

43. You are completely missing my point

I never said that wealthy people pay nothing, I did say that all the wealthy people I know pay very little(and yes that is very little in percentage).

If you have the money and are smart you don't pay your assigned tax rate, federal or state.

Nothing I have said is a lie, and assuming you know what I make and pay in taxes and what the people I know make and pay in taxes is really arrogant. Just because you can't accept that someone might be doing something that does not fit into your assumed generalization does not make it a lie.

[w4rma]

15. It's becaue they have too much money compared to everyone else. (nt)

[daylan b]

16. And if they aren't paying taxes as the person I was replying to claims

where is that tax revenue coming from?

[thetonka]

18. The middle class

There are a lot of wealthy people paying a lot of taxes, but if you are smart and have money you don't need to, and the tax code supports this.

The more I make, the less I seem to pay in taxes. Of course the more I make, the more property I can buy and write off, the more I can invest in tax shelters.

Just like so many things with our government, reality is far more complicate than the statistics say, and far more complicated than it needs to be.

[daylan b]

19. Do you really think the stats the IRS puts out about where

the money actually comes from are lies that Obama, Bush, Clinton, Bush, and so on were all in on?

[thetonka]

25. Do you really think the stats are as straight forward as they all claim

Lies, Damn Lies and Statistics.

Statistics can be manipulated and use to support almost any argument is you know what you are doing.

[daylan b]

27. Please explain how you think those statistics are being manipulated

It should be pretty easy. It's obvious you have researched this and aren't commented based off of rhetoric.

[thetonka]

29. Simple

Lets base the amount of tax revenue on the straight tax rate and income of those in the highest tax bracket. That's a lot of money.

However, you add in the deductions and a lot of those people drop tax brackets. Depends on which column you pull income from.

I've looked at the raw data in the past, and it was SURPRISING how many people pay a lot less than people assume they do. I've know a few people over the years that were in the 7-figure a year range and they paid almost nothing in taxes.

Like a friend I had a while back used to say "Its not what you make, it's what you keep". Of course last I heard the rumor was he was in prison for tax evasion, got caught up in that whole "Income tax is illegal" scam.

[daylan b]

30. You understand that the "top 5% pay 60% of all income tax"

is based on gross revenues that are the end result AFTER all of the deductions right?

[Winterblues]

21. While they may pay sixty percent of the taxes it is a much smaller percentage

of their income and wealth than those that pay the forty percent..The wealthy find ways to pay as little as possible...Always have and always will and Congress is just their flackies that make it so..

[daylan b]

23. Source?

Any source?

BTW, I won't hold my breath because what you said is just bull shit and it doesn't take long for a person to realize that if they look at actual facts instead of something they were told.

[thetonka]

24. Here is one, wasn't hard to find if you actually look

http://taxjustice.blogspot.com/2009/04/us-wealthy-how-much-tax-do-they-pay.html

These 400 taxpayers paid income taxes averaging $45 million in 2006. As a share of AGI, their tax bills averaged 17.2 percent.

http://www.ctj.org/pdf/irstop400.pdf

If you really think the wealthy pay their actual tax rate you do not realize how much privilege and power wealth gives.

I keep hearing arguments about the wealthy paying their share, and yet nothing is being done to simplify the tax code and eliminate or close deductions and loopholes so EVERYONE pays their actual tax rate. Why add more taxes when they don't pay the ones that are on the books now?

Simplify the tax code and eliminate the vast majority of the personal deductions and loopholes. Not only does this push for more equality, it also guarantees tax revenue, will most likely increase tax revenue, will most likely result in stable tax revenue from year to year, and makes it easier and less costly for the individual and family to get through tax season.

Our tax code is a complete disaster.

[daylan b]

26. Was $45 million/year what you meant by "almost nothing"...

...when you made the statement my entire challenge of you was based on? Because if so, sorry, I misunderstood what you meant by that. Where I'm from that's a fucking lot of money.

If you want to remain relevant to the context of it, the top 20% actually pay 34.5% of their income when local, state, and federal taxes combined.

BTW, the ultra ultra rich 400 people you speak of pay such a low rate due to the capital gains rate, which I have already pointed out as the real problem in the tax code.

[thetonka]

28. Agreed.

Bottom line though, and we may agree, is there are too many deductions and too many loopholes.

Check out some of the articels on taxjustice.net, watching people spend time and money to avoid paying taxes is one of my biggest pet peaves, it does NOT need to be this complicated or unfair.

[daylan b]

31. Yes, there are a lot.

But this idea that the rich don't pay taxes in this nation is just bogus and does nobody any good.

[Ruffhowse]

3. hmmmm....

How did tax rates between income levels vary during say the 1950's compared to today? Is the tax revenue as a percentage of GDP an average number for that time period?

[daylan b]

6. More info than you want can be found here...

http://www.gpoaccess.gov/usbudget/fy10/pdf/hist.pdf

Pages 34-35 detail the numbers I'm speaking of and they were top and bottom ranges for years within the decades mentioned.

The bottom line is that even with the extreme top bracket rates of the 50s the government still brought in less from income taxes as a percentage of GDP than we did during the opposite extreme of the 2000s under the Bush tax cuts. That's because the tax havens of that era put anything people think is a tax break today to shame. It's also why it's not an apples to apples comparison on the top marginal rate.

[happyslug]

4. Remember prior to 1980, you had the 50% disregard for long term Capital Gains

Basically Long Term Capital Gain was a term used for investments that you held for five years or later (The terms has been used since 1980, but no where near the effect of pre Reagan Long Term Capital Gains).

Long Term Capital Gains meant that if you held an investment for five years and then sold that investment, you only paid income tax on 50% of the total gain from that sale. Thus if someone was in the 91% tax bracket (and at that bracket almost all money was from investments NOT work) you paid 91% on only 50% of the gain. Thus if you sold a plant for $1 million dollars after holding it for five years. you paid taxes on only 1/2 million (i.e. 91% of 1/2 million NOT 19#% of One Million Dollars).

The real effect of Long Term Capital Gain was to take almost all of the money earned by people speculating on the Stock Market (and elsewhere) but rewarded people who invested in long term investments. The Former (Stock speculators) had to pay 91% of any gain over max tax rate, but if the person invested in a factory which he or she sold after holding it five years, only paid 91% on 1/2 of the proceeds. In effect you had twice the returns on long tern investment then the Stock market (The Government took the difference if the gain was NOT over five years).

[WCGreen]

9. Now it's capped at 20% on investments held for one year....

[daylan b]

10. Which is where the real outrage should be.

Everyone focuses so much on the already progressive income tax brackets. The real way the rich avoid paying taxes is through capital gains. You'll never hear a politician going after that though because that's where their money comes from.

[WCGreen]

12. I do taxes for a living. It's ridiculous that people making 50-60k

a year are basically, in more than a few cases, paying the same percentage as people pulling down 250k.

[MilesColtrane]

5. Are those income tables adjusted for inflation?

[daylan b]

11. If you adjusted the 1963 bracket to 2010

the 91% bracket would be $2.85mm.

[WillyT]

8. Short Version...

:hi:

[AnArmyVeteran]

33. Perfect! Thank you.

[slackmaster]

22. It will only open eyes partway - Very few people actually made over $50,000 in 1978, for example

That was about when my parents hit the highest rate they ever paid - They had the honor of making it to the 42% tax bracket after my dad got an unexpectedly large pay raise. My parents were also getting hit hard with California state income tax, and with property tax on our family home. I remember well how they bemoaned the fact that with increased fuel and food prices, because of high taxes we weren't any better off than we had been five or so years earlier.

My parents, one Republican and one Democrat, both voted Yes on California's Proposition 13 that year, and so did I.

[AnArmyVeteran]

32. Let's bring back the 91% tax rate for all income over $400,000!!!

It's obvious from all eras in our country's history that tax rates had virtually nothing to do with productivity. Right wingers believe if a person has a great idea he first looks at the tax code, and if he doesn't like it he just gives up and goes back to sleep. In the 1970s when Bill Gates and Steve Jobs were working on their computers they didn't look at the 70% income tax and just quit their ventures. No one who has an idea for a business looks at the tax code and then gives up. (if you disagree with this then cite one person who gave up after looking at the income tax rate). 

Why do democrats allow the right wing to get away with their blatant lies? If you listened to republicans in government, on the radio or faux noise you would think all entrepreneurs get up every day and first look at the tax code before deciding to put on their clothes and go to work on their ideas or businesses. When right wingers make this claim they are saying Americans who have ideas and visions give up easily, and they are quitters. If you had a great idea would you give up if the tax rate was increased by a paltry 4%? 

When the income tax was at 91% our country had one of the most productive eras in our country's history. It also was a time when we had the greatest growth in the middle class in the history of the world. And since the government had the resources it built a network of highways crisscrossing the entire United States. Bridges, dams and electrical lines were also built throughout our country. Imagine what would have happened if today's radical republicans were in control of congress and the presidency 50 & 60 years ago? None of those improvements to our country would gave been done. Republicans would have called all of that infrastructure 'socialistic' and condemned all of it. But if none of that infrastructure was built we would never have seen the growth of tens of thousands of businesses as we did. We wouldn't have become the envy of the world with the advancements we made in technology. 

And we wouldn't have seen the rise of the middle class. One of the best contributions to our country was the GI Bill, which enabled millions of veterans to go to colleges and trade schools. Without their training businesses wouldn't have had the employees needed to start or grow their businesses. But do you think a GI Bill like the original could be passed today with every republicans attacking it as a socialistic program? 

Without the government involvement our country would be 20-30 years behind from where we are today. All of the successes of businesses were born out of government spending and those 70-90% income tax rates. Without a national highway system how could companies get their products to market? They couldn't. Hell, they couldn't even produce their products in the first place without the electric lines to power their machinery. 

When the tax rate was about 4% higher under Clinton the economy was great and almost 22 million jobs were created. After Bush lowered the income tax by about 4% just a paltry 1 million jobs were created in 8 years. Clinton's presidency produced a balanced budget, while Bush's 8 years added over a trillion in debt. 

When Bush left office a staggering 700,000 people were losing their jobs every month. Our country's economy was in free fall. Without government spending losses of that magnitude would have continued until total collapse occurred. The ripples of doom would have become tidal waves and flooding everything in its path. It is unconscionable how republicans are either so ignorant or unAmerican to want our country to fail purely for political gain. They need to be held accountable for their constant obstruction to every plan that would make our country better. And we can do that next Tuesday on November 2nd and vote against every republican on every ballot in the country. They are not fit to govern. 

I don't understand how democrats ever lose the debate over taxes or the economy when it's obvious past republican leadership has been disastrous for Americans and the country. Maybe democrats should do what Ross Perot did when he was running for president. Perot used low tech flip charts to describe things so even the dumbest person in the room could understand what he was saying. Say what you want about Perot, at least people could understand his message. Most people don't have a clue what the democrats' message is or what democrats have accomplished in the past 21 months. 

Note: I used some generalities in this post, but the essence of what I wrote is absolutely true. Without government intervention in the past we would be living in a third world country today. And what is dangerous is republicans want to turn the US into a third world country. They wave their flags, thump their Bibles and quote the Constitution, but if they gained control of our government again the United States will certainly be transformed back to the good old days of the 19th century. 

That's what this upcoming election is all about. Vote dammit!

[ThomWV]

36. Take a look at 1920 - those are exactly the rates we should have today.