This kind of puts a hole in most liberal arguments for a “progressive” tax on the wealthy.  They already pay the most!

  • Top 1% of wage-earners pay 34.27% of taxes
  • Top 5% of wage-earners pay 54.36 % of taxes
  • Top 10% of wage-earners pay 65.84% of taxes
  • Top 25% of wage-earners pay 83.88% of taxes
  • Top 50% of wage-earners pay 96.54% of taxes
  • The bottom 50% of wage-earners pay less than 4% of taxes.

It really puts things in perspective doesn’t it?

Source: Internal Revenue Service, Tax Policy Center, Tax Foundation

HT: Allan Bevere

20 comments
  1. im all for flat taxes, but you want a small government?

    make sure the republican party doesn’t (explicative – edited by CT administrator) up and waste people’s money in the first place.

    you just dont go to war and at the same time dont want to pay for it.

    *** comment policy – CT doesn’t allow explicit language.

  2. im all for flat taxes, but you want a small government?

    make sure the republican party doesn’t (explicative – edited by CT administrator) up and waste people’s money in the first place.

    you just dont go to war and at the same time dont want to pay for it.

    *** comment policy – CT doesn’t allow explicit language.

  3. What on earth would happen to our government if we all decided not to pay taxes until we received a disclosure statement for all government expenditures, good and bad. Afterall, they work for us; don’t we have a right to know where our money is going? Realistically, I know they need our tax dollars to run the government, but the wasteful spending goes unmonitored and has to stop. Let’s all pray that John McCain and Sarah Palin get in there and clean up the waste in Washington!

  4. What on earth would happen to our government if we all decided not to pay taxes until we received a disclosure statement for all government expenditures, good and bad. Afterall, they work for us; don’t we have a right to know where our money is going? Realistically, I know they need our tax dollars to run the government, but the wasteful spending goes unmonitored and has to stop. Let’s all pray that John McCain and Sarah Palin get in there and clean up the waste in Washington!

  5. I didn’t see this as a post arguing for flat tax.

    A progressive tax rate is more equitable, but let’s not always roast the people paying the most taxes in the first place. Asking them to pay a higher incremental rate may not immediately be a disincentive to making more money, but it does begin to change behavior regarding wealth creation.

    People must feel motivated to create wealth, in the process often creating jobs and spending money which helps drive overall prosperity. That being said, people will still look to make money even with higher taxes, but the question is whether we have somehow disincented the investment or effort at the margin.

    It is a fine balancing act and I fear political rhetoric is too blunt nan instrument to finely slice what is best overall for the nation, and the world as a whole.

  6. I didn’t see this as a post arguing for flat tax.

    A progressive tax rate is more equitable, but let’s not always roast the people paying the most taxes in the first place. Asking them to pay a higher incremental rate may not immediately be a disincentive to making more money, but it does begin to change behavior regarding wealth creation.

    People must feel motivated to create wealth, in the process often creating jobs and spending money which helps drive overall prosperity. That being said, people will still look to make money even with higher taxes, but the question is whether we have somehow disincented the investment or effort at the margin.

    It is a fine balancing act and I fear political rhetoric is too blunt nan instrument to finely slice what is best overall for the nation, and the world as a whole.

  7. Eric,

    Not sweating it. I realize I’m not a tax or economy expert, but the percentages based on income tax speak for themselves. His comment just shows that he doesn’t have anything of substance to say.

  8. Eric,

    Not sweating it. I realize I’m not a tax or economy expert, but the percentages based on income tax speak for themselves. His comment just shows that he doesn’t have anything of substance to say.

  9. Yes, the rich provide most tax revenues. They also control most of the taxable wealth. The top one percent have 33.4% of wealth (in total assets) and the top 20 percent control 84.4% of the wealth. That leaves 15.5% for the other 80% of the population. This lines up pretty well with their proportion paid in taxes. When looked at in the aggregate like this, taxes seem very flat at present.

    I know that your numbers (and these ones) are accurate. The question is your interpretation. Does the fact that the people that control 34% of the wealth pay 34% of the taxes mean that progressive taxation is a bad idea? Would it be better if more of the bottom 50% of the population’s taxes (which amount to a measly 3.5%) were placed on the top 5 percent? I suggest that it would. The small proportional increase would be something like one to six percent more of income going to taxes for the wealthy. This would not be large enough to disincentivize wealth generation (for proof see the early 90s when we had a 39% top tax bracket as opposed to 33% now) but the benefits would be increased economic viability for most of the population, as well as a decreased need for entitlement programs, since the lowered taxes for this demographic would act as a tax credit, (which is perhaps the most popular conservative economic policy *winks* )

    Long, but hey, I stuck to the issues.

  10. Yes, the rich provide most tax revenues. They also control most of the taxable wealth. The top one percent have 33.4% of wealth (in total assets) and the top 20 percent control 84.4% of the wealth. That leaves 15.5% for the other 80% of the population. This lines up pretty well with their proportion paid in taxes. When looked at in the aggregate like this, taxes seem very flat at present.

    I know that your numbers (and these ones) are accurate. The question is your interpretation. Does the fact that the people that control 34% of the wealth pay 34% of the taxes mean that progressive taxation is a bad idea? Would it be better if more of the bottom 50% of the population’s taxes (which amount to a measly 3.5%) were placed on the top 5 percent? I suggest that it would. The small proportional increase would be something like one to six percent more of income going to taxes for the wealthy. This would not be large enough to disincentivize wealth generation (for proof see the early 90s when we had a 39% top tax bracket as opposed to 33% now) but the benefits would be increased economic viability for most of the population, as well as a decreased need for entitlement programs, since the lowered taxes for this demographic would act as a tax credit, (which is perhaps the most popular conservative economic policy *winks* )

    Long, but hey, I stuck to the issues.

  11. It’s important to note that a lot is relative hear. The bottom half of the income earners have a negligable fraction of the overall wealth, which is why they pay so “little” in taxes. It’s not like they don’t pay anything, and I’m sure it hurts their ability to live a lot more than the taxes that the rich have to “endure.”

    The amount that the upper income earners would have to pay extra in proposed plans to increase the tax rate for the 250K+ crowd are relatively small.

    I don’t hear about too many upper middle class to wealthy folks going without health insurance. Yet increasingly, the middle class is having to abandon health insurance just to make ends meet.

    The percentages in your post are provocative, sure…but if taken in proper context, all they really say is that there is a LOT of money concnentrated at the top, and it does NOT trickle down, no matter what Reagan’s economic folks predicted in the 80s (and some still do today)

  12. It’s important to note that a lot is relative hear. The bottom half of the income earners have a negligable fraction of the overall wealth, which is why they pay so “little” in taxes. It’s not like they don’t pay anything, and I’m sure it hurts their ability to live a lot more than the taxes that the rich have to “endure.”

    The amount that the upper income earners would have to pay extra in proposed plans to increase the tax rate for the 250K+ crowd are relatively small.

    I don’t hear about too many upper middle class to wealthy folks going without health insurance. Yet increasingly, the middle class is having to abandon health insurance just to make ends meet.

    The percentages in your post are provocative, sure…but if taken in proper context, all they really say is that there is a LOT of money concnentrated at the top, and it does NOT trickle down, no matter what Reagan’s economic folks predicted in the 80s (and some still do today)

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