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To: Cinnamontea

I agree - we need to broaden the tax base. But one clarification, even the poor and middle class pay 7.25% in federal taxes.


573 posted on 01/03/2011 8:36:55 AM PST by al_again2010
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To: al_again2010
But one clarification, even the poor and middle class pay 7.25% in federal taxes.

Which for the poor, is largely canceled out by things like the earned income tax credit.

Here's another thing for you to read and be informed:

http://cbo.gov/publications/collections/tax/2010/all_tables.pdf

Note the first table. The effective tax rate for all federal taxes was 4.0% on the lowest quintile, and 10.6% on the second quintile.

But, read the explanation at the end: Social insurance, or payroll, taxes are attributed to households paying those taxes directly or paying them indirectly through their employers. Social Security + Medicare is a combined 15.3% tax on payroll, when you account for both the employee and employer (self-employed pay both).

Look at the second table on the first page. Note that the federal individual income tax rate for the bottom two quintiles is actually negative, reflecting the transfer payments that offset the social insurance taxes that were paid by the employee, as well as some paid by the employer.

591 posted on 01/03/2011 9:04:58 AM PST by justlurking (The only remedy for a bad guy with a gun is a good WOMAN (Sgt. Kimberly Munley) with a gun)
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