The “wealthy” whomever that may be, cannot carry the cost of everything Americans want. The wealthy most certainly do pay their fair share and more.
There is a reason Europeans pay a 22% VAT for all they want from government.
Wealthy, rich, millionaires and billionaires take your pick. They are all targets of misleading, very annoying propaganda aimed only at making the average American feel like a victim and thereby to garner support for the political left.
Notice that the targets of these fair share claims are not defined. In addition, there is no definition of fair share. Better to leave that to ones imagination.
Throwing around “wealthy” and “fair share” is nothing more than an effort to sustain division and encourage class warfare ……. and its reprehensible. A recent survey by the American Psychological Association found that the number one stress factor for Americans was not health care or money, but the divisions in America and the state of our nation. Mission accomplished!
Do you consider earning $100,000 a year wealthy or rich? That income puts you ahead of 90.4% of Americans and higher than 72.4% of households. Bump that to $150,000 and you earn more than 96.2% of individuals and 86.5% of families. Click here and see where your income puts you. Are these the wealthy who don’t pay their fair share? $150,000 may be well off in Arkansas, but not so much in Connecticut or New Jersey.
But do the really rich pay their fair share? Take a look for yourself. Even with relatively low-income tax rates, a minority of Americans pay most of the income taxes. The top ten percent by income pay over 70% of all income taxes.
You might say, well when it comes to Social Security and Medicare they don’t pay their share. It’s true under Social Security the payroll tax is taken on limited earnings and lower-income Americans pay a greater portion of their total income in taxes, but it’s also true benefits are calculated only on the Social Security taxable income, plus the benefit formula favors lower-income taxpayers. The higher income get less in benefits for their taxes paid. In addition, the higher income pay more income taxes on their benefits.
Here is the formula for 2018 PIA (Primary Insurance Amount). The PIA is adjusted each year.
For an individual who first becomes eligible for old-age insurance benefits or disability insurance benefits in 2018, or who dies in 2018 before becoming eligible for benefits, his/her PIA will be the sum of:
(a) 90 percent of the first $895 of his/her average indexed monthly earnings, plus
(b) 32 percent of his/her average indexed monthly earnings over $895 and through $5,397, plus
(c) 15 percent of his/her average indexed monthly earnings over $5,397.
Under Medicare there is no limit on taxable income plus a surtax of 3.8% on investment income. Also higher income people pay substantially more in Part B and D premiums and no, we are not talking millionaires.
But lets talk millionaires. Out of the 150,494,263 tax returns filed (2016) 3.3% reported an income of $1 million or more. Given that tax filers with incomes of $500,000 or more pay over 54% of income taxes, we can conclude they pay their fair share? Do we expect three percent of our citizens to carry the rest? Is that fair?
But do the wealthy disproportionately benefit from tax breaks? The top ten tax breaks benefit all Americans with only a few skewed toward the upper middle class. The largest break, employer paid health care disproportionately benefits working Americans. Here is the full list.
If your tax rate is 25% and you get $15,000 in tax-free income through employer health benefits, of course the dollar value is more than if your tax rate is 15% That is a bogus argument frequently made to prove the rich benefit more. The fact is the lower-income worker receives a greater portion of their total compensation tax-free.
In addition, the tax code contains scores of limits on the tax-favored benefits for higher income Americans including limits on pensions, 401k plans, IRAs, group life insurance, even compensation. Some limits are on individuals, others based on family income. This alone creates an unfair disparity between one and two income families.