From the right: The bottom 10% are "lucky duckies"

[Vanguard]

As a subscriber to the WSJ, I have to say that its news is excellent. Its editorial page, however, is more like the comics page in most newspapers. You just scan though it trying to get a chuckle or two.

[JohnT]

GePap, do you even read the WSJ??? Obviously not, or else you would've become bored senseless with the wide range of tax options discussed on the WSJ opinion page, including the sales tax which has received positive (read, for) editorial stances.

Sava, you also don't seem to read the papers much or able to Google search, as this chart will show. The top 1% of income earners ($313k+) pay 37% of the income taxes, the top 5% pays over half at 56%, and the top 25% of wage-earners ($55,000) pays 84% of the nations individual income tax bill. The bottom 50% pays less than 4% of the TOTAL income tax bill. I'd call this progressive by any stretch of the imagination, Sava/GePap!

I wonder what the percentages for European countries are. How many of them demand the top 25% of taxpayers pay for 84% of the total income tax bill?

[Vanguard]

What the Journal is trying to do is find a way to rationalize Bush raising taxes when there are no longer any Democrats around to take the fall.

[GePap]

I would never read the WSJ. Besides the fact that Wall Street news don't interest me, the fact that they are right of Atilla the HUn in their editorials puts me off.

As for your tax chart: that is the point, that Income Tax is not the only tax out there, as the poor and lower middle class pay payroll taxes and sales taxes also. The better question is, how much of their income do each of these groups pay in overall taxes, and what is their share of the Overall tax burden, when compared to their slice of the GDP. I have never seen such a chart, and that one would be the one to interest me.

Also, will you miss GOP in WSJ?

[Jaguar]

Originally posted by Sava
I bet if you did an in-depth study about who pays what, I'm sure you'll see that the top 1% and corporations end up paying much less taxes (as percentage of income) than the middle and lower classes. With all the corporate welfare, bermuda tax dodging, and Bush/Reagan style cuts, the wealthy make out like bandits.

If Sava bets it, it must be true.

[Dauphin]

Originally posted by JohnT
I wonder what the percentages for European countries are. How many of them demand the top 25% of taxpayers pay for 84% of the total income tax bill?

UK

http://www.inlandrevenue.gov.uk/stat...x/it_t04_1.htm

         Top 1%    Top 5%     Top 10%     Next 40%     Lower 50%
2000-01  23%        41%        51%           38%           11% 
2001-02  23%        42%        53%           37%           11%  
2002-03  23%        42%        52%           37%           11%

Doesn't surprise me though. If you are in the top 10% you earn many times more than the average person and will thus pay much more than everyone else - and thats just in a flat tax system.

To understand the 'fairness' of it you need to look at the distribution of income.

[axi]

Some bourgeois are so naive that they want to abolish all taxes and state. They forget that those taxes and that state is what's coming between their properties and the masses.

[Six Thousand Year Old Man]

Originally posted by axi
Some bourgeois are so naive that they want to abolish all taxes and state. They forget that those taxes and that state is what's coming between their properties and the masses.

Exaaaaactly.

[Sava]

JohnT: That was exactly my point... I don't know sh!t about the actual numbers...

[Jules]

Originally posted by chegitz guevara
I'm in agreement with DanS, up to a point. Everyone should be taxed. Everyone needs to have a monetary stake in the system. However, I think the income tax structure should be far more progressive. Taxes on basic necessities like food (labeled tax loopholes by the politicians in Florida) should be substantially lowered or abolished. Tax on unemployment income should be abolished. (I know, rather self-serving of me).

I believe Republicans would respond to that by pointing out that more and more Americans own stock, therefore they do have a monetary stake in the system, further justifying their policies which are supposedly designed to help the market.

[Sikander]

Originally posted by Sava

It is obvious to those who aren't drowning in selfishness and self-righteousness.


JohnT: That was exactly my point... I don't know sh!t about the actual numbers...

[JohnT]

GePap: "I would never read the WSJ. Besides the fact that Wall Street news don't interest me, the fact that they are right of Atilla the Hun in their editorials puts me off."

It's not just "Wall Street" news, it's the news of commerce and industry. You know, "work."

The reason I asked is that you made a couple of assertions that just were just flat out inaccuracies and lies. The statements that the WSJ has never run an editorial slanted for progressive sales tax proposals, and that the paper no longer uses "GOP" are patently false. On a personal man-to-man note, you will find that your arguing position is vastly enhanced when you actually know what the fvck you're talking about, OK?

Regardless, the rightest slant of the WSJ's editorial board no more prevents them from being the premiere daily newspaper about American Industry than the fact that the Washington Post leftist editorial bias doesn't prevent them from being the premiere daily newspaper about the US Government.

Dolphin:

code:


         Top 1%    Top 5%     Top 10%     Next 40%     Lower 50%

2000-01  23%        41%        51%           38%           11% 

2001-02  23%        42%        53%           37%           11%  

2002-03  23%        42%        52%           37%           11% 

Compared to the NTU numbers ( http://www.ntu.org/links/FAQs/whopaysincometaxes.php3 ), I think it is obvious that the US's personal income tax rates are far more "progressive" than the UK's. The middle class and the poor pay a higher percentage of the income taxes in the UK than they do in the US. Hell, compared to US millionaires, the ones in the UK pay 40% less in income taxes! Is the UK the newest tax haven for the super-wealthy?

I know, I know: ya'll screw them over other ways - BBC taxes (amazing!), VAT taxes, sales taxes, etc. etc.

Any other countries want to post their rates? Roland?

Sava, you do seem to argue a lot without knowing the numbers. I'm going to start confusing you with GePap if you're not too careful!

[JohnT]

I did find the article last night, but forgot to bring it in to the office this morning so I won't be able to quote directly. It is in the Wednesday, November 20th newspaper, on the very top left of the two-page editorial section. (There's also a number of repetitions of "GOP" in section A, btw. But I digress.) It's position makes it, I think, the "official" position of the WSJ editorial board.

The article was a mixture of what I said earlier this thread and what was reported by DanS, and it drew two conclusions:

1. That a situation where 50% of the country can vote themselves freebies out of other peoples pockets is an inherently unstable position. They don't know the true cost of government and have no financial stake in it's wisdom.

2. That any policies designed to attract votes by tinkering with income tax rates automatically excludes any benefit for 50% of the people and is becoming a decreasingly effective vote getter. In short, income tax reform as a vote-getting tool has passed the point of diminishing marginal returns and the White House had better realize that fact.

They mentioned payroll taxes in passing, but that's OK. The subject of the article was income tax payments, and payroll taxes were outside its 500-word domain. Trust me, the WSJ will bemoan payroll taxes in time - it is their destiny.

[JohnT]

Btw, the title of this thread is misleading. The article specifically calls the 50% of us who pay no federal income tax "lucky duckies", not just the "bottom 10%".

[uh Clem]

Certainly there are those who want to take without paying, and this has a corrupting effect on government.

Without taxation, there wouldn't be the revenue to fund government contracts. A provision in the "Homeland Security" bill would have excluded corporations that hide income by reincorporating offshore, etc...in other words, those who want others to pay, while they themselves do not.

Unfortunately, the lucky duckies managed to get this dropped from the bill before it was passed, thus voting themselves freebies out of other peoples pockets.

So, yeah, we need to do something about this. It's a very high priority, and I hope the WSJ can spare the time and editorial space to look into it.

[axi]

A look at the offshore companies? But how can you look at them without binoculars? They're so far awaaaay....

[Sava]

Those statistics don't take into account the off-shore tax dodging... or any tax dodging in general.

[DanS]

I can draw some conclusions above and beyond what the WSJ talks about (I haven't read the editorial--I have come to my opinions on my own).

First and foremost, in order to have greater buy-in for "Republican" policies, we need to have greater stock/bond ownership by those in the bottom 50%. This is so that, as Jules points out, business-friendly policies will have wider impact. For instance, removing the double taxation of dividends would be a good thing for American business overall, but presently would mean no immediate benefit for about 40-50% of the population.

I would recommend futzing with the "third rail" of politics--social security reform, in order to put stocks/bonds in people's pockets. If the discussion doesn't kill the Republican party in the short run, it can't help but be better for America and the GOP in the long run.

[uh Clem]

A call for social engineering. Hmmmm.

[DanS]

Well, the social engineering is already being done with payroll taxes.

If a mere 1/3rd or 1/4th of the payroll taxes were moved to private activity, this would benefit both America and the GOP pretty hugely over the long run.

I don't think Bush will take this opportunity because it's risky for '04, but you never know. I would much prefer it versus accellerating the tax cuts, for instance.

[Ogie Oglethorpe]

Originally posted by DanS
I can draw some conclusions above and beyond what the WSJ talks about (I haven't read the editorial--I have come to my opinions on my own).

First and foremost, in order to have greater buy-in for "Republican" policies, we need to have greater stock/bond ownership by those in the bottom 50%. This is so that, as Jules points out, business-friendly policies will have wider impact. For instance, removing the double taxation of dividends would be a good thing for American business overall, but presently would mean no immediate benefit for about 40-50% of the population.

I would recommend futzing with the "third rail" of politics--social security reform, in order to put stocks/bonds in people's pockets. If the discussion doesn't kill the Republican party in the short run, it can't help but be better for America and the GOP in the long run.

While I agree that this would be a good thing, my guess is the greater public at large would not have the same degree of buy-in to a Social Security mutual fund/index fund as they would have say in their 401-k's as normally have direct control over investment stratgies within the 401-k. Whether the overall public opinion and subsequent policies to the US industries would become more favorable depends greatly on the communication of the vested interest all folks would have. I'm not sure that concept would translate well.

[Dauphin]

Originally posted by JohnT
Dolphin:
Compared to the NTU numbers ( http://www.ntu.org/links/FAQs/whopaysincometaxes.php3 ), I think it is obvious that the US's personal income tax rates are far more "progressive" than the UK's. The middle class and the poor pay a higher percentage of the income taxes in the UK than they do in the US. Hell, compared to US millionaires, the ones in the UK pay 40% less in income taxes! Is the UK the newest tax haven for the super-wealthy?

UK income tax is 40% for all and everyone earning over ~$50,000, 22% for ~$9,000-$50,000, 10% for ~$7,000-$9,000 and nil% below ~$7,000. What are the US tierings?

Unless your figures are hugely different what I think what is clear from the stats is that the rich-poor divide in the US is greater than in the UK.

I think the reason the rich are footing most of the tax bill is because they are also getting most of the income. If the rich earn a lot more relative to the poor then they pay a lot more in taxes. The figures for comparative tax bills are not indicative of progessive taxation differences, but of income distribution differences.

[DanS]

"I'm not sure that concept would translate well."

I agree with you. Risky political business.

But one note of hope in the last election was that the social security "privatization" label that the democrats used was surprisingly ineffective--everybody in Washington believed the voting public to be much more "conservative" on the issue (i.e., not for changing the current system). For instance, Coleman in Minnesota didn't run away from the issue and actually turned it around to his benefit.

[DanS]

SD: The marginal rates are as follows...

http://www.infoplease.com/ipa/A0106989.html

These marginal rates are after all sorts of deductions--at least $6,500 for an individual. Also consider that state income taxes are based in large part on federal income taxes. So by and large if you don't pay federal, you also don't pay state.

I assume when you say $, you mean GBP?

[Spiffor]

Originally posted by JohnT
I wonder what the percentages for European countries are. How many of them demand the top 25% of taxpayers pay for 84% of the total income tax bill?

FYI, in France :
About half of the households don't pay the income taxes as they're under the threshold. The tax is progressive and reaches 54% for the highest incomes. This max. rate has been lowered some years ago, I don't remember what the max. was before.

However, our politicians have bypassed the "problem" in all hypocrisy : there are 2 new taxes taken by the state, officially to pay back the debt of our social security : "Contribution Sociale Généralisée" and "Remboursement de la Dette Sociale" take about 9% of all incomes, coming from work or from capital.

European pressures and presidential demagogy mean income taxes will lower in the upcoming years. The government told us taxes were lowered by "5%". I don't know the details, but it seems the people paying 54% of their income are the most favored by this change.
Income tax represent about 20% of the State's income.

Also, since we're talking about sales taxes in this thread, the French "Taxe sur la Valeur Ajoutée" (TVA) is 19,5% IIRC on all products except food, medication, and cultural goods (5,5% in this case). There used to be a higher TVA for luxuries, but I don't know if it continues.
TVA is 40% of the income for the state, being the most rewarding tax. TVA is a "hidden" tax, because all prices are written with all taxes included : you have to look twice on your bills to know how much you paid to the state. OTOH, income tax is obvious : one has to fill a complex form every year or more to pay his income tax, and eventually knows precisely what he paid.

Of course, politicians cynically raise TVA whenever they want a boost of popularity by lowering income taxes. This is consistent with EU demands.

There are also specific sale taxes for cigarettes / alcohol, and for fuel. They are significantly higher than TVA (about 80% of the fuel's price is taxes)

[DanS]

TVA/VAT isn't progressive at all. Why do y'all except it?

[uh Clem]

One fly in the ointment is that if lower income citizens had so much stock ownership that their perceptions became more nearly those of owners than workers...

...(or in other words, if those at the bottom of the pyramid owned proportionately MORE, while those at the top owned proportionately LESS),...

...then it would undermine the entire point of having a George W Bush administration in the first place, wouldn't it?

Since Reagan/Thatcher, the transfer of wealth has been upwards, not downwards. I doubt that the people who set policy for this administration see themselves as having been put in power in order to reverse this trend.

Sounds almost Clintonian, in fact. (Okay, low blow...)

[Spiffor]

Originally posted by DanS
TVA/VAT isn't progressive at all. Why do y'all except it?

Maybe it wasn't clear from my previous post, but I don't. It's an extremely unjust tax, which combines taxing the poor more heavily than the rich (since poor people have to use a much higher part of their income to consumption), and disrespecting the taxpayer, at least in France where the tax is semi hidden.
I absolutely hate it, and consider income taxes should be heavily raised in France to make up for the necessary heavy lowering of VAT/TVA. That's my opinion, but I think most people in favor of progressive taxes hate VAT/TVA as much as I do.

[DanS]

"That's my opinion, but I think most people in favor of progressive taxes hate VAT/TVA as much as I do."

I think I grok the political dynamics.

It seems unlikely that nice socialists like yourself would be for increasing the income tax rate for the lower tax brackets nearly enough to make up for the loss of TVA/VAT.

Your politicians understand that because of this, the higher earners would be taxed at an outrageous rate (rather than the 63% that is implied now--i.e., 54% + 19.5% of the remainder), so they take the expedient route and go TVA/VAT.

In the US, we just soak the rich, believe it or not. We can do this, because the overall tax burden on society is smaller.

For instance, if you lived in Maryland/Montgomery County, you would pay the 38.6% marginal federal income tax rate + 23% marginal state income tax rate = 61.6%. Then add FICA, which is about 8% paid by the employee (and 8% paid by the employer) on the first $75,000 in income. Then real estate taxes at .838% of your home's value. Then sales tax at 5% on some items.

[GePap]

JohnT:

Don't get so damn worked up.

As for the 'GOP', the Fox affiliate here in NYC reported that the editors of ther WSJ had asked their writer ot phase out using GOP. Take it up with Rupert if you have a problem with his media- empire's reporting.