Kasz216 said:
spurgeonryan said:
Wait? Millionaires pay less of a percent of there income than poorer people do! Is that what I am reading?
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That's what your reading.... but it's not true.
It's a talking point created by conflating Income with Capital Gains.
One is a salary gained through working... in which the rich pay MUCH more.
The other, is a tax placed on investments, in which the rich ALSO pay MUCH more.
The diffrence is Rich people are more likely to make more money on investments then poor people, Therefore when the two are combined together they are being taxed a "Lower percentage".
Aka, someone makes 10 dollars through working and are taxed 20%.
VS someone who makes 10 dollars through working, and is taxed 20%, then makes 90 dollars through capital gains, and is taxed 10% on that... they're "only paying 15%"
I pay a much higher amount of taxes then other people who make as much money as me using this same standard... because I have money invested... that, even if you counted it as income wouldn't move me over to the next income bracket even though my captial gains bracket is higher then my income tax bracket, because actually, I don't have to pay ANY taxes outside of FICA or Social security.
I'm actually forced to pay MORE money for being responsible!
Yet nobody cares about that, a case of the exact opposite happeneing... because it's not a way to target the rich.
However, the different tax rates exist for a number of good reasons. To just list one (edit: Was wrong on number 2)
1) Capital gains are much riskier. If you work 40 hours a week, you are guranteed that money. Capital Gains vary with the market, you could make a bunch of money only to lose it.
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