The wealthy have never paid a higher portion of their income in federal taxes than they’re paying now — at least not since the Congressional Budget Office started tracking the data in 1979.
You wouldn’t know it listening to the left, who never deviate from their mantra that the rich must pay their “fair share.” They’re never asked to define how much is fair, but a working definition is “more” — regardless of how much high earners are paying.
The highest earners are already carrying the load. The ability of a few outliers like Warren Buffett, who manages to structure his income to minimize his tax liability, creates the myth that the wealthy pay less than the middle class. It’s simply not true.
According to a new study by the Tax Policy Center, based on CBO data, the government takes more than a quarter of the income of the wealthiest 20 percent of American households through federal taxes — income, payroll, corporate and estate. And taxes on this quintile generate 72 cents of every dollar in federal tax revenue.
With an average combined household income of $204,490, the average tax bill for the top quintile is $55,533, and that does not include other taxes — state income, local payroll, property or sales taxes.
Taxes on the other 80 percent of households generate only 28 percent of federal tax revenue.
The numbers are especially disproportionate for the much-maligned “1 percent.” These affluent households, with an average combined income of $1.4 million, pay average taxes of $514,144. And this 1 percent of households pay 30 percent of all federal taxes, a portion far larger than their share of income.
Yet President Obama insists that they pay still more. After persuading Republicans to go along with raising taxes on high earners just two months ago, he is already demanding more tax hikes on the wealthy.
This country has strayed far from its founding ideals when the president of the United States thinks the federal government is being short-changed after it takes more than one-third of any taxpayer’s earnings.
The bottom 20 percent have a negative tax liability. Instead of paying taxes, they receive an average of $284 from the government by claiming more in credits than they owe in taxes. And that doesn’t include entitlement payments.
The middle class? The average household in the middle 20 percent, with an income of $46,562, pays $6,436 in federal taxes, 13.8 percent of their income. This quintile produces just 8.6 percent of federal tax revenue.
In the United States, those choosing to work harder to earn more should be allowed to enjoy the fruits of their labor. Those willing to take risks should be allowed to reap the benefits when they succeed — especially since successful entrepreneurs create jobs and value in the economy.
That’s a better definition of “fair.”