50% Of Americans Don’t Pay Taxes
Posted by Phil Ferguson on August 16th, 2011 – 5 Comments – Posted in FinanceThis is a new GOP talking point.
“We’re dismayed at the injustice that nearly half of all Americans don’t even pay any income tax. And you know the liberals out there are saying that we need to pay more.” In this context, “we” refers to Perry and everyone who shares his worldview.
So… Perry does not want the rich people like him to pay one dime more but the poor should pay more.
This is an increasingly popular argument in right-wing circles — Michele Bachmann, one of Perry’s presidential rivals, has pushed the same line — thought it’s entirely counter-intuitive. The argument isn’t even subtle: far-right Republicans are annoyed that most Americans don’t make enough money to be eligible to pay income taxes, so they believe it’s important to get more of these lower- and middle-income Americans paying more to the government.
Recently an upset friend told me that, “50% Of Americans Don’t Pay Taxes”. Even Rick Warren in pissed…
It appears that Rick Warren quickly took down his tweet when someone pointed out that while he makes millions every year, he pays no income tax.
In this video Rush Limbaugh tells us what jesus would do. This is followed up by actual bible quotes. The godbots do not even know their own book. (not a surprise)
Visit msnbc.com for breaking news, world news, and news about the economy
If my friend has said almost 50% of households don’t pay income tax – that would be true.
So how many households don’t pay income tax?
In 2009, roughly 47% of households, or 71 million, will not owe any federal income tax, according to estimates by the nonpartisan Tax Policy Center.
The vast majority of households making up to $30,000 fall into the category…
I will use a household income of $24K for the math below
However, they do pay:
Sales tax that can be greater than 10% in large cities, (tax of around $2,400/year – if you make very little, you save very little)
FICA tax at 7.65% of income (plus another 7.65% from the employer), (tax of $1,836 per year – plus what they employer pays)
Gasoline tax of $.47 per gallon, (tax of $470 [20,000 miles per year at 20 miles per gallon X $.47])
Property tax (even if you rent – it is included in cost of rent), (educated guess here… $1,000 per year)
State income tax (avg 6.7% or $1,608)
I’m sure there are other taxes but just these few add up to a grand total of $7,314 ($2,400 + $1,836 + $470 + $1,000 + $1,608) or 30.5% of income. So…no income tax just 30% of their income paid in taxes. Warren Buffet only pays income tax rate of 17%.
Now let’s take it one step further. Let us see what happens if all of these households were forced to pay an additional 5% income tax. That would be 71 million X $24,000 X 5% or additional revenue of around $85 Billion per year. 2010 US budget shortfall was about $2 Trillion ($2,000,000,000,000). Our additional $85 Billion would cover 4.25% of the bill!










I’m glad that you put some numbers up to show how that statement is bullshit. I roll my eyes every time I heat that comment from the right because I know it has to be BS and now I know for sure.
And that was a terrific take down of the drug addled gas bag by Laurence. I’m starting to really like the way he gets down to the core of the issues.
This is perhaps the favorite conservative whopper lately and I’ve been debunking it for quite some time. Here is a rather thorough post I put together with several references:
http://fayfreethinkers.com/forums/viewtopic.php?p=23724#p23724
Short version and quickest way to rebut this canard: (as you note) it’s a fallacious cherry pick of Fed income taxes, purposely and conveniently excluding all others, especially payroll taxes. When we include just that category we find:
“…only about 14 percent of households paid neither federal income tax nor payroll tax in 2009,…” –ibid
Note also, 40% of the US population is under 20 and over 65. So that 14% is easily accounted for with young students, the elderly and poor.
Just another example of profound rightwing dishonesty and distortion.
Thanks for the little fact nugget Dardedar. Much easier to pull out of the bag-O-retorts!
Shouldn’t progressives OWN this talking point? Isn’t this proof positive that the nondistribution of income is materially harming our country? It is a BAD THING that 47% of the country is living paycheck to paycheck, unable to invest, unable to make enough money to even be taxed.
I honestly want an answer to this question: how are we supposed to pull ourselves out of a decade of economic doldrums when 47% of the country has effectively zero buying power, and the rich–you know, the “job creators”–are either hoarding their wealth, or sinking it into investments to grow their own net worth at the expense of letting any of it trickle down?
I finally sat down and put together the definitive roast of this “50% don’t pay” tax canard. 1,800 words, eight charts, all referenced. View it here:
http://fayfreethinkers.com/forums/viewtopic.php?f=1&t=6610
Pass it around.
Here is the simplified one sentence version:
“81.9% of the population pays federal taxes based upon income or payroll, and of the 18.9% that do not, 95% of them are elderly or very poor.”