We got the change alright, and that’s about all we’ll have left out of our paychecks.
On the PDF that has the whole analysis, it shows that a family of 4 making ~ $45k/yr will have marginal tax rate of 73%. The House bill is even worse at 82%. The current rate is about 42%.
They plan to take almost all of thier money.
How do you survive on 173 percent effective taxation?
1. Hide income sources. 173 percent on 10 percent of your income works out to be an effective tax of about 17.3 percent.
2. Non-taxable transactions. Barter, etc. Trade services for other services.
3. Increasing income. If your income is going up, then the taxation on 173 percent of last’s years can be paid with your new income.
4. Offloading expenses. Things you would otherwise have to pay for get loaded back onto the government (ie, unemployment, health care, food stamps etc).
Generally people adopt some form of the following survival strategies, especially when they are just getting started and they have minimal income, but high obligations. There are many ways in which fees can total over a 100 percent of a person’s income, at least up here in Canada.
I’ve heard some of these numbers as well. It is going to reach the point where people just don’t pay some or all of their taxes. Fraud will be rampant. Our historically high
citizen honesty in tax preparation is going to mirror Russia before they had to revamp their tax laws to reduce tax fraud. Once people get to this point it is almost impossible for citizens to ever have faith in their existing government again.