John Stossel brings up some interesting points about our income tax system that you may or may not know. We have now reached the point where half the households in the United States pay no income taxes. Many of these will actually get tax rebates on taxes that they never paid.
The top twenty percent of earners in the United States pay over ninety percent of the income taxes!
Obviously these facts raises some issues.
If half the households in the United States pay no income taxes or are receiving money from those paying incoming taxes why would they ever vote to change a tax system that would not continue to favor themselves? How can representatives be elected that will pass laws to change or do away with the income tax system when half of the people do not pay any taxes at all or actually receive money they never paid?
One problem with a Democracy is that when the majority can vote in whatever they want at the expense of a minority you have a tyranny of the majority otherwise known as mob rule. That was really why our founders created a Republic and not a Democracy but everyday the United States is become more like a Democracy. That tyranny of the majority has arrived in our income tax system.
We have a minimum income tax in our income tax code but that only applies to a few top producers. If we actually put a 10 percent minimum income tax on everyone like we should under a fair system, the income tax system would either not be retained by the majority or most people in our nation would realized that federal government should be much smaller and then lower the tax.
If we are going to have a United States income tax system everyone in this nation should have to pay part of that tax. The taxes supporting foreign wars and our benefits and United States overspending habits should impact everyone not just twenty percent. If all contributed we would see a better tax and spend system rather than this transfer of wealth socialism and this put off the bills to be paid by your children system that we see today.
For most of the life of the United State we did not have an income tax and America did quite fine without it. But, as soon we got that income tax system government realized they could increasing take more and more income from the productive. They started progressively robbing more and more from the productive in order to create a socialist nanny state where now half the nation waits for a handout from Governor Sammy. Now the Sammy slaves that the government created would not dare to vote against the Governor and risk losing their hand out.
The Constitution gave government certain means to collect taxes and if we really need a large national government it should be paid for by those that benefits from it When twenty percent of the people are paying all the income taxes in the United States, this tax system is not fair and it encourages the majority to become unproductive. When the majority can stop the minority that are paying the taxes from ever changing the tax system because the majority benefits from it, then they have created a tyranny by the majority.
If people want a charity network then charity should best be determined at local levels and funded by those people of good will that are willing to fund it, not some United States income tax system that enables a tyranny of the majority.
When half gives and half takes
The theory of government I was taught says that government provides benefits, primarily security, to the entire population. In return we pay taxes. But lately the government has been a distributor of special privileges, taking money from some and giving it to others. America is now about evenly split between those who pay income taxes and those who consume them.
The Urban-Brookings Tax Policy Center recently disclosed that close to half of all households will pay no income tax this year. Some will pay less than zero – that is, they’ll get money from those of us who do pay taxes.
The Tax Policy Center adds that this year the average income-tax rate for the bottom 40 percent of earners will be negative and that their cash subsidy will equal 10 percent of the total amount the income tax brings in, thanks to the Earned Income Tax Credit and President Obama’s “Making Work Pay” program.
The view from the top also shows the lopsidedness of the tax system. The top 20 percent of earners makes about 53 percent of the income in America but pays 91 percent of the income tax. The top 1 percent pays 36 percent. The IRS says the bottom half of earners pays less than 3 percent.
This presents a serious problem because government has such vast powers to dispense favors. As Shaw suggested, people who pay no tax will not hesitate to vote for politicians who promise big spending. Why not? They will get stuff without having to pay for it.
Don, it is the Earned Income Tax Credit that is the way that the 80% are getting money back during tax season. If you make around $25,000 and have two children under the age of 18 you can receive in the form of credits up to $3500 per child, sometimes $4000. This does not include the standard deduction for dependents. Oh, and if you pay for daycare for a child under the age of 4, you can deduct all the costs of the daycare too. Did you know that daycare for a child under 4 can cost around $100 a week. The EIC is being sorely abused by those that go to tax preparers with phony documents about children that do not live in their home. I know this for fact, I offered to do the tax preparation for some people I thought I knew. When they came to me with documentation of children I did not recognize as their own, I just said that the software I was using would not allow me to enter those other names.
I believe the Earned Income Tax Credit should be stricken from Tax Law. You and I did ok without receiving extra money from the government when we were raising our children.
Have you ever read The Creature from Jekyll Island? I highly recommend it…
http://www.scribd.com/doc/6479760/The-Creature-from-Jekyll-Island-by-Edward-Griffin
Lorrie, that book was written to show how the Federal Reserve or the Central Bank was started. The Internal Revenue Service got it’s start in the early 1920’s. I can not remember the exact date the IRS was given Law Enforcement authority. The IRS mostly went after moon-shiners and liquor boot-leggers, a lot of federal revenue was being lost to illegal liquor sales, at least so the IRS thought.
The Revenue Act (Unconstitutional) and Federal Reserve Act (Unconstitutional) were passed the same year, 1913. The IRS wasn’t formed until 1953.