Why more Americans pay no income tax

[werepossum]

"From each according to his means, to each according to his needs" didn't begin in our government with the Messiah, he's merely spreading the big government gospel. The EIC started under Reagan as a pretty good program as government programs go. Recognizing that payroll taxes are very regressive for the working poor, the EIC allowed the poorest workers to receive a rebate of some or even all of their payroll taxes as if they were income taxes, so that working would actually pay better (after expenses) than the dole. As all government programs tend to do, it has since evolved into a straight welfare program where low and moderate income workers can recover not only their own payroll taxes, but also some of others' income taxes. Vive la revolucion I suppose.

 

[DesiPower]

so that they can vote for Dems

 

[highland145]

so that they can vote for Dems

Actually and unfortunately the EIC $$ grew under Bush during his of tax cuts. Don't know if it was thrown in by/for the dems as a bone because of the cuts or not.

 

[CADsortaGUY]

I don't understand, what does who they voted for matter? And double dip how? Most old people no longer pay income taxes.

Uh... they let the politicians SPEND the money they paid in on other "benefits" the gov't deemed people wanted and now they want the money they paid in. That money was long gone due to them - not me.

 

[highland145]

Uh... they let the politicians SPEND the money they paid in on other "benefits" the gov't deemed people wanted and now they want the money they paid in. That money was long gone due to them - not me.

I sure as hell haven't "let" any politician spend what I sent in. But they have done it anyway. I don't agree much with the ones I voted for much less the ones on the other side.

 

[HendrixFan]

http://en.wikipedia.org/wiki/Earned_Income_Tax_Credit

The EIC is basically welfare but since it is included in people's tax returns it allows for all kinds of screwy numbers.

The "negative" tax that that group pays gets averaged in with other people in similar income ranges to drag down the percentage of taxes those groups appear to pay. You have one person with negative $4000 and four other people paying $1000 in taxes and the average tax paid would be zero. Since they divide tax rates into brackets, the lower income brackets that get the EIC really get hammered when you look at taxes paid as a group.

If the EIC was listed as what it really is, welfare, and wasn't a part of the tax code the breakdown would look vastly different.

Aside from the Federal Income Tax, the people in lower tax brackets pay a much larger percentage of income in taxes in the form of Medicare/Medicaid taxes and SS taxes. Couple those with state and local taxes, and it is extremely misleading to talk about people paying no income tax, as the federal income tax for most americans is a small percentage of the taxes paid.

Before anyone chimes in to say that Medicare and SS taxes shouldn't be lumped in with federal income taxes, bear in mind that Medicare and SS have run huge surpluses for decades. Those surpluses were coming out of the pockets, primarily, from the bottom half of wage earners. The surplus money was put in to the country's general fund and spent alongside federal income tax dollars. It ended up in the same bucket, so it is extremely stupid to act like it is somehow fundamentally different than federal income tax.

 

[Jhhnn]

Without EIC and other subsidies to working class people, they'd organize and demand higher wages. With EIC, the investor class wins twice- first by reaping larger profits, and again by financing govt deficits used to finance EIC, earning interest on money they'd have otherwise spent on wages.

It's really socialism for the rich, even though it's been made to appear otherwise.

 

[HendrixFan]

Without EIC and other subsidies to working class people, they'd organize and demand higher wages. With EIC, the investor class wins twice- first by reaping larger profits, and again by financing govt deficits used to finance EIC, earning interest on money they'd have otherwise spent on wages.

It's really socialism for the rich, even though it's been made to appear otherwise.

Sounds plausible. It was mentioned up in the thread, and I have read elsewhere, that the EIC has gone up most during Republican administrations. I'd like to see some breakdown on that to see how accurate it is.

It is welfare, but classified as a negative tax. It is so absurd. If the $8k home tax credit was run up against income tax think of what it would do to the statistics for taxes. Same with just about any of the government's expenses that go directly to taxpayers.

It is hard to have a reasonable discussion on fixing taxation when the numbers are so convoluted. I think it is intentional. The flat tax isn't really a good idea (IMO), but honestly it would be better than the crap we have now.

 

[nonlnear]

Without EIC and other subsidies to working class people, they'd organize and demand higher wages. With EIC, the investor class wins twice- first by reaping larger profits, and again by financing govt deficits used to finance EIC, earning interest on money they'd have otherwise spent on wages.

It's really socialism for the rich, even though it's been made to appear otherwise.

Um... I want some of what you are smoking. That's some good shit man!

 

[HendrixFan]

Um... I want some of what you are smoking. That's some good shit man!

Welfare has always been for the rich, disguised as for the poor. Welfare rolls were at their lowest in 30 years during Clinton's terms because he felt it was necessary to have people earning their own living wage. You throw the poor people some welfare (or EIC checks every year) and they will be content. If they actually had to suffer through being poor they would either take advantage of the ability to move up in social class or if they couldn't actually find work en masse, they would revolt.

Revolutions don't happen when the bottom part of society are all getting handouts.

 

[IronWing]

Hmmm. Maybe if we move away from the hyper concentration of wealth and income among the super rich and working people were able to earn a higher wage then they could pay taxes!

However, since the bought and paid for corporatist president and congress will never go for that, we can at least get rid of dumb tax breaks:
Double personal deductions for simply living past 65
Deduction of mortgage interest
Deductions for breeding
Special low rates on capital gains (tax them like any other income)
Credits for solar, clunkers, buying a house, etc.
Take a hard look at the tax write-offs for business expenses to figure out which ones truly reflect a reasonable business expense against profits and which are simply corporate welfare.

Also, abolish corporate income taxes to the extent that corporations are American owned. Collect these taxes through regular personal income taxes on the shareholders. For foreign owned corporations, income taxes would need to be imposed as collecting directly from the shareholders may not be feasible.

 

[WhipperSnapper]

One of the core reasons is that the upper classes supported economic policies that impoverished the lower classes.

First we sent millions of middle class jobs overseas. Then we imported foreigners on H-1B and L-1 visas to displace Americans from often college-education-requiring jobs. Then we imported tens of millions of poor immigrants to displace lower class Americans from their jobs and to drive down wages for them.

No wonder fewer Americans are paying taxes! They're unemployed or underemployed now. Duh.

 

[CycloWizard]

One of the core reasons is that the upper classes supported economic policies that impoverished the lower classes.

First we sent millions of middle class jobs overseas. Then we imported foreigners on H-1B and L-1 visas to displace Americans from often college-education-requiring jobs. Then we imported tens of millions of poor immigrants to displace lower class Americans from their jobs and to drive down wages for them.

No wonder fewer Americans are paying taxes! They're unemployed or underemployed now. Duh.

Victim victim victim! Do you know how visas work? Why would a company sponsor a foreigner's visa if they could hire an American to do the same job? The only reason would be if the American, not unlike yourself, refused to turn his brain on to allow him to do the job.

 

[spidey07]

This whole discussion can be summed up with the following.

You cannot legislate the poor into prosperity by legislating the wealthy
out of prosperity. What one person receives without working for, another
person must work for without receiving. The government cannot give to
anybody anything that the government does not first take from somebody
else. When half of the people get the idea that they do not have to work
because the other half is going to take care of them, and when the other
half gets the idea that it does no good to work because somebody else is
going to get what they work for, that my dear friend, is the beginning of
the end of any nation. You cannot multiply wealth by dividing it."*

Adrian Rogers, 1931*

 

[txrandom]

I saw something interesting on the Daily Show that I really don't know the substance of, but apparently Exxon Mobil had $35 billion in profits last year and paid $15 billion in taxes. Not a single penny of which went to the U.S.

Where do these taxes go then?

 

[BigDH01]

This whole discussion can be summed up with the following.

Cecil Sherman once asked Rogers about the biblical treatment of slavery. Sherman claims that Rogers replied...

"I believe slavery is a much maligned institution; if we had slavery today, we would not have this welfare mess."

I also imagine that since your source attributes this quote to the year 1931, the year in which Adrian was born, your source is actually some chain email. I would much prefer it if you derived your logic and your facts from something other than the latest vitriol spread around effortlessly by idiots.

 

[HendrixFan]

Where do these taxes go then?

Other countries where they have tax shelters.

 

[werepossum]

Victim victim victim! Do you know how visas work? Why would a company sponsor a foreigner's visa if they could hire an American to do the same job? The only reason would be if the American, not unlike yourself, refused to turn his brain on to allow him to do the job.

To quote a very young chicken: Cheap! Cheap Cheap Cheap!

 

[Ldir]

To quote a very young chicken: Cheap! Cheap Cheap Cheap!

This. Too many American companies not willing to pay market rates and not willing to train people they already have. So they claim no Americans can do the job and they need more visas to hire people from India and China. It is a scam to take good American jobs.

 

[Ldir]

One of the core reasons is that the upper classes supported economic policies that impoverished the lower classes.

First we sent millions of middle class jobs overseas. Then we imported foreigners on H-1B and L-1 visas to displace Americans from often college-education-requiring jobs. Then we imported tens of millions of poor immigrants to displace lower class Americans from their jobs and to drive down wages for them.

No wonder fewer Americans are paying taxes! They're unemployed or underemployed now. Duh.

Yet most Republicans keep voting for people who are selling them out so the rich can get richer.

 

[feralkid]

^ What about the money he won from the Nobel Peace Prize people?
http://nobelprize.org/nobel_prizes/peace/laureates/2009/index.html

He never personally accepted one penny.

He had it donated directly by the Nobel Committee.

Everyone knows this.

 

[Patranus]

47% the country pays no income taxes
51% the country thinks income taxes are too high.

I wonder what is going on here 🙄

 

[EagleKeeper]

To quote a very young chicken: Cheap! Cheap Cheap Cheap!

This. Too many American companies not willing to pay market rates and not willing to train people they already have. So they claim no Americans can do the job and they need more visas to hire people from India and China. It is a scam to take good American jobs.

In order to get the visa that have to show documentation to the Dept of Labor.

Those people are also complicent/incompetent and rely on what ever documentation the company provides.

They can only audit the information - not verify the relevance/applicability.

 

[CycloWizard]

This. Too many American companies not willing to pay market rates and not willing to train people they already have. So they claim no Americans can do the job and they need more visas to hire people from India and China. It is a scam to take good American jobs.

You just completely contradicted yourself. Why are these foreigners not part of the market? If they are willing to do the job for less than an American, then good for them. If I refuse to do the same work for the same pay as someone else, why should a company hire me? They absolutely should not and they would be foolish to do so, regardless of my country of origin. Why is this sort of discrimination codified as part of the liberal viewpoint, when all other forms are railed against so fiercely?

 

[Patranus]

This. Too many American companies not willing to pay market rates and not willing to train people they already have. So they claim no Americans can do the job and they need more visas to hire people from India and China. It is a scam to take good American jobs.

What do you mean "market rates"?

There are no market rates in the USA, only what the government thinks you should be paid.

If the market was allowed to dictate rates unemployment would drop instantly.