By F. Swemson
won (stole) the recent election based on the absurd platform that the rich weren’t paying their fair share of taxes. So what is your fair share?
We frequently hear statistics about how big a percentage of income-tax revenues the top 1 percent of taxpayers pay, and we also hear about how little, if any, the bottom 50 percent actually pays. But what does that translate into in real numbers of actual dollars?
Last year, the government took in roughly $1.1 trillion in income taxes (including payroll taxes) from 138 million American individuals and families filing returns. The top 1,380,000 taxpayers, the top 1 percent, paid a total of 38 percent of the total revenues collected, or $418 billion. That comes to an AVERAGE income tax paid of $303,000 each. That’s over $5,800 per week in income taxes that those people had to pay. How can anyone say they’re not paying their fair share?
The top 6,900,000 taxpayers, the top 5 percent, paid 59 percent of the total revenues, or $649 billion. That comes to an AVERAGE income tax paid of $94,058 each, or almost $2,000 per week. I’m sure we all know lots of people who would be happy to just earn $2,000 per week before taxes.
The top 13,800,000 taxpayers, the top 10 percent, paid a total of 70 percent of the total revenues, or $770 billion. That comes to an AVERAGE income tax paid of $55,797 each, over $1,000 per week in taxes.
Those are some pretty serious numbers when you consider that the average total annual income tax paid by the bottom 50 percent of filers came to only $478 each. That comes to only about $9 per week on average.
Considering those figures, if the government needs an additional billion dollars in revenue, who should pay what percentage of those additional funds?
If the only ones who have to pay are the top 1 percent, that means each of them will have to pony up an additional $724 each. But, if we split it evenly between all 138,000,000 filers, that comes to a grand total of $7.08 each, or only $0.14 each per week in additional taxes. That’s right … 14 cents each per week. Call me crazy, but I’m not embarrassed to ask everyone to pay their fair and equal share of the extra tax burden when I look at the actual numbers. But while it’s easy to say that 14 cents isn’t much, it’s a great deal of money when we’re talking about job creation and analyzing how much money is invested back into the economy every year. If the top 1 percent of taxpayers pay 38 percent of total tax revenues, I wouldn’t be surprised if they’re responsible for well over half of the total funds re-invested into job-creating businesses each year.
This is why raising taxes on the rich is such a bad idea in a struggling economy with high unemployment. If everyone shares the extra burden equally, the poorest taxpayers will have to live with one less 64-ounce Big Gulp soda from their local convenience stores every two months, which may be a good thing in the end. (Did you ever notice that while poor people around the world are usually very skinny, a huge percentage of our poor people are morbidly obese?)
Looking at things in reverse can be illuminating. Rather than having the government taking an additional billion dollars from the top 1 percent, let’s give them each a tax cut of $724 so that they can invest a billion dollars back into the economy. By doing this they’d be creating more jobs, and therefore more tax revenues for the government. Of course, the bottom 99 percent of the taxpayers will have to make up the difference in the meantime. If we increase their taxes by a billion dollars, it would cost each one of them an additional 14 cents per week.
Looked at in another way, each time one of the top 1 percent gets fed up and moves to a different country, our economy has to generate over 600 new entry-level jobs to replace the tax revenue the government loses as a result.
One only need to look at the mass exodus of the rich from France, now that their new socialist president has raised the marginal tax rate for income over 1 million Euros a year to 75 percent. I get real frustrated listening to the pundits on Fox say that Obama doesn’t get it, and is making a big mistake by insisting on higher rates for the rich because it won’t help create jobs if he does so. Au contraire – Obama knows exactly what he’s doing. By raising rates and driving the rich out of the country, he’s hastening the collapse of our economy and our entire way of life, which is, after all, his primary objective.
F. Swemson, an admirer of Ayn Rand, was a U.S. Marine Corps combat photographer in the 1960s and is now a boating technology writer.