The ultimate fraud?

[El_Phil]

Helpfull Hint #42: Never start a company in America if there's even the slightest chance of AT getting into power.

[Atrocities]

Muwhahahahahahahahahahahhahhhhh - caugh - hahahhahahahahahahahahahahahahahah.

[El_Phil]

Something from an entirely different conversation which I thought AT might like to know. Estonia has flat rate taxes, everyone pays 20% (or whatever %) income tax across the board.

[Atrocities]

I think there are a few other nations that do this.. Not sure how good it is.

As to the US, I would just like to see those who have a ton of money pay their equal share. If I pay 14% on my income, then so should they. Why should they only have to pay 5% or less because they make more money? If I can't keep 14% of the money I earn, then neither should they!

Right now the tax code rewards the rich and severly punishes the lower income folks. Factor in the new tax increases in gas, comodities, property, and sales taxes, you begin to see just how over taxed the lower income really is.

When we pay out 14% of our base wage in tax, and 30% of our OT wages go to taxes we have less to spend on other taxes like gas, sales, and property.

For example out of every $100.00 I earn, I would lose $14.00 in tax leaving me with just $86.00 to spend. Other taxes eat a majority portion of that up. (8.8% sales tax plus Gas Tax Plus other taxes.)

Now if that $100.00 was OT. Then you would only get $70.00 of it.

For every $100.00 a person over lets say $150.000 dollars a year makes, they would pay about 4 to 5% less in tax. So for every $100.00 they earn at base wage, they would get to keep $95.00 to $96.00 dollars.

Compare:
Your $100.00 - after taxes $86.00
Their $100.00 - after taxes $95.00.

They just earned $9.00. Now if they are earning $9.00 out of every $100.00 they earn OVER YOU, well then you can see the disadvantage of the whole system.

For every $1,000.00 in tax the rich save $90.00 whereas the lower income folks don't.

Now this is all just a generalization, and is not meant to be taken as concrete fact. The tax percentages and income levels can vary and most likely do. The above comments are meant to outline a basic understanding of the dispute between rich and poor tax payers. The are not to be taken as actual fact. For accurate tax percentage scales and or level of taxation please contact the IRS.

[El_Phil]

If I understand that right, it is a spectacularly stupid system. I really can't think of any justification for it working that way, although you'd hope there is one.

[Wolfman77]

It is a very bad system in my opinion as well. The way it's written the rich can claim correctly that they pay a higher percent of their income in taxes, because 1/2 - 3/4 of their income can be deducted as non-taxable. Here's an example:

If I make $25,000 in a year, and my standard deductions are $7,500. Because my job and the resulting limitations on my lifestyle, I have very little else I can claim as a tax deduction. That leaves $17,500 that I need to pay taxes on. At 20% tax on that, I pay $3,500. That comes out to 14% of my original $25k income.

Now say someone else makes $250,000 in a year. They then start subtracting all their deductions, $50k for a retirement savings, a "bussiness trip" to the bahamas for $10k, donations of around $5k, Buisiness lunches, wardrobe, home office space and equipment, even their childrens allowances can be deducted as household help. By the time they are done they can easily get down to claiming $100,000 as income, and if they pay 25% of that it comes to $25k, which is only 10% of their total income.

So they can say they pay a higher percent of their income, since they pay 25% instead of 20%, but after everything is calculated they come out quite a ways ahead.

Note that this is also just a generalization to show how the rich can bend the tax code, and is not to be taken as actual tax records. If you want numbers from the actual tax code, try this http://www.fourmilab.ch/ustax/ustax.html
or contact the IRS.

[Atrocities]

Thank you Wolfman, that was very englightening to say the least. A very good example on how the tax code screws the litte man.

Now if you could only get your tax base down to $10,000, having deducted away $15,000 ($150.000 by the rich man standard) then you would be in a far better place. As it stands, per dollar earned, people making less pay on average 75% to 100% more in taxes than those who earn over a 100k a year. That is a frelled up system by any standards that only favors the rich and dramatically punishes the poor.