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mrstickball on 28 April 2009
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highwaystar101 said:
@ Mrstickball - Sorry about the lateness of my reply, I just read your post. I'm not to sure what the tax rate is for the top 1% of the US is, but it seems to me a lot of countries have been increasing the amount the upper band of earners pay. There must be a reason. I would imagine with the rich poor divide in USA it would work to a greater extent.

I'm not sure though, I'm not that economically savvy.

I would say that, at least in America, we raise taxes on the richest, because many rich people have loopholes to avoid taxes. When you have access to more income (make more money), you also have access to smarter means of avoiding paying taxes such as tax shelters. Because of that, taxes are usually increased to compensate for the rich people that avoid taxes. That is not how you fix the issue of taxation. You remove the shelters, to ensure that all rich people pay fairly.

From my view, that's what makes our system so lopsided, even far beyond what progressive taxation scheme we have in place at this time: Poor and lower-middle class payers don't have access to good accountants that can give them the best means of avoiding taxes, but the rich (certainly) can.

As of 2006, the Top 1% paid 39.89% of income taxes, with the Top 5% paying 60.14% of all income taxes. The question we have to ask is 'Does the Top 5% actually make 60% of all income in the US?'

The answer to that question is 'no'. The top 1% actually made only 20.0% of all US income in 2000. In fact, you have to include the entire Top 20% to equal the taxation the Top 5% bear the burden of.

Maybe it's just me, but I don't think that punishing the successful by taxing them 2-3x more than the bottom 50% is really the best way to tax people. We hurt the successful, and bless the stupid. To me, thats kind of counter intuitive to the American dream.

As for the tax rate, it's 35% for Americans earning over $357,700 filing either separately, or jointly (of course, this is changing thanks to Obama). In the UK, it's 40% for those earning over 34,600 GBP. Of course, both are before sales tax (US) and VAT in the UK.

So at any rate, I think the US tax system is a bit uneven at the moment. Maybe I'm the only one that thinks that you shouldn't add extra taxation to success.



Back from the dead, I'm afraid.