Taxes. Now there is a subject to certain to elicit a discussion. Am I the only person who is pleased to pay taxes?
It seems like it whenever I read letters to the editor or op-ed pieces here or elsewhere.
Personally, I view taxation as one of the costs of freedom. Communist nations never demand taxes. You don’t hear the Saudis or Kuwaitis complaining because they don’t pay taxes, either.
But frankly I wouldn’t give up my taxes to live anywhere else. Would you?
What bothers me about my taxes is how my tax dollars are being used. That is a common complaint I find preferable to complaints from people who simply don’t want to part with a dollar yet are more than willing to accept government benefits.
I also have no problem with progressive taxes. It is a far more rational idea than regressive taxes. But I am also bothered by whether or not the rich pay their fair share.
Some will argue that the rich pay almost all the taxes.
CNBC even aired a segment in which it was claimed that the rich pay all the taxes. Of course, that is wholly untrue.
Most arguments in support of the rich are based on accurate but misleading data or blatant falsehoods.
Yes, the wealthiest amongst us do actually pay more income tax than the rest of us. Yes, they even pay a rate proportionately higher than the percent of income they earn.
But Mitt Romney went so far as to say 47 percent of Americans do not pay any taxes, a statement that painted him as an elitist and that was simply false.
The data came from a legitimate report. However, it dealt only with federal income tax due April 15; it excluded payroll taxes, state and local taxes, and mandatory payments for Social Security and the Medicare Trust Fund.
It turns out that half of the 47 percent Romney spoke of pay no federal income tax because they simply don’t earn enough income.
Most of the rest don’t pay it because of special protections for the elderly and working class families with children. In fact, there are only 14 percent of Americans who actually pay no taxes whatsoever. You can bet that includes some very wealthy individuals.
Jason Fichtner of George Mason University argues the rich pay their fair share, but he claims incorrectly the top 1 percent of earners include people earning under $344,000. He also bases his argument on the fact that the top 1 percent have an average tax rate of 24 percent versus 18 percent for the top 10 percent and 12.5 percent for the top half of earners.
He ignores the fact that the tax rate on income is not the same as the actual percentage paid after deductions and loopholes.
Mr. Romney for instance admitted to paying only 14 percent on his total income.
Dan Berger, a member of Patriotic Millionaires for Fiscal Strength said the answer is not because the tax code is skewed in favor of the rich.
When you compare the comparable tax burdens between the rich and the rest of us you discover Mr. Berger makes a strong case.
The burden of the top 1 percent is less than persons in other income groups, even though they pay proportionately more in income taxes.
Tamara Draut, author of “Strapped: Why America’s 20-and 30-Somethings Can’t Get Ahead,” suggests in order to answer the question about the top 1 percent paying their fair share we first must ask this question: Does the U.S. generate enough income to fund the public structures that are essential for individual and business prosperity?
These things include education, transportation networks, health care and many other important functions of government in a capitalistic society. She states that by any indicator, the U.S. is falling short of providing both the revenues to fund these services as well as providing for their ongoing maintenance and modernization.
The poorest amongst us are paying less in income tax than before but so are the very wealthiest. The wealthiest 1 percent may actually pay less as a percent of income by simply taking advantage of exiting tax breaks, many of which are not available to most Americans.
And that folks explains why Warren Buffet pays a lower percent than his secretary and how Mitt Romney can afford to put an elevator for his automobiles in his La Jolla mansion and pay only 14 percent in income tax.
Michael Adkins formerly was chair of the Hancock County Democratic Party. He lives in Greenfield.