President Barack Obama says “it’s only right that we ask everyone to pay their fair share in taxes.”
Rich folks must be wondering when their refund checks will start arriving in their mailboxes.
The current income tax is progressive, requiring those making more to pay a higher rate. Thus, those earning a million dollars pay, on average, 29 percent of their income to Uncle Sam, while those taking home $50,000 to $75,000 a year pay an average of 15 percent. This progressivity can be seen in wide angle, too: Figuring credits and exemptions, 47 percent of Americans pay no federal income tax at all. Meanwhile, the top ten percent in income pay 73 percent of all income taxes collected.
And Obama’s idea of taxing “the rich” would only make it more unfair.
But, wait, what about billionaire Warren Buffett? Doesn’t he pay a lower percentage of his income in taxes than does his secretary?
Most of Buffett’s income comes off his investments, not in salary. That’s capital gains, taxed at 15 percent. Obama decries it, but doesn’t propose any specific increase in capital gains taxes. Why? He doesn’t want the stock market to crater. As he put it two years ago, “The last thing you want to do is raise taxes in the middle of a recession.”
So, when President Obama says the rich should pay their fare share, what does he mean? Simple: “If you’re not rich, vote for me.”
This is Common Sense. I’m Paul Jacob.