The article reports:
According to the latest IRS data, the payment of income taxes is as follows.
The top 1 percent of income earners, those having an adjusted annual gross income of $480,930 or higher, pay about 39 percent of federal income taxes. That means about 892,000 Americans are stuck with paying 39 percent of all federal taxes.
The top 10 percent of income earners, those having an adjusted gross income over $138,031, pay about 70.6 percent of federal income taxes.
About 1.7 million Americans, less than 1 percent of our population, pay 70.6 percent of federal income taxes.
The article points out that there are some serious questions about the fairness of this arrangement:
But the fairness question goes further. The bottom 50 percent of income earners, those having an adjusted gross income of $39,275 or less, pay 2.83 percent of federal income taxes.
There’s a severe political problem of so many Americans not having any skin in the game. These Americans become natural constituencies for big-spending politicians. After all, if you don’t pay federal taxes, what do you care about big spending?
So why should the bottom 50 percent of income earners and those who pay no income tax be interested in electing people who will cut taxes and stop runaway spending? If less than 1 percent of the population is carrying the tax burden, they really don’t have any serious political leverage–they are a very small voting bloc.
There is also another aspect to this:
There’s another side to taxes that goes completely unappreciated. According to a 2013 study by the Virginia-based Mercatus Center, Americans spend up to $378 billion annually in tax-related accounting costs, and in 2011, Americans spent more than 6 billion hours complying with the tax code.
Along with tax cuts, tax simplification should be on the agenda.
Our current tax code is a tribute to the successful efforts of lobbyists and special interest groups. That needs to change.