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Thursday, April 8, 2010

1/2 of US doesn't pay fed income tax

I mean I think the title of this article says it all: “Nearly half of US households escape fed income tax.” I implore you to read the article – written by the Associated Press, posted on Yahoo Finance – it’s startling, to say the least. For those that are too lazy, I’ll copy and paste some highlights:
  • About 47 percent will pay no federal income taxes at all for 2009.
  • The federal income tax is the government's largest source of revenue, raising more than $900 billion -- or a little less than half of all government receipts.
  • The top 10 percent have paid about 73 percent of the income taxes collected by the federal government.
  • The bottom 40 percent, on average, make a profit from the federal income tax, meaning they get more money in tax credits than they would otherwise owe in taxes. For those people, the government sends them a payment.

I understand that the majority of those who are paying no federal income taxes (or, in some cases are actually making a profit) are lower income families, I get it, and in many situations their circumstances are absolutely absurd – fighting to keep a job and support their families. But I still don’t understand how anyone could consider this fair, for 10% of the nation to pay for 75% of what the government spends. Listen, I get the economics, I get the 80/20 rule, I get the incredibly skewed income distribution in this country, but I still can’t help but wonder how on earth this seems okay.

It comes down to a fundamental disagreement I have with this whole philosophy, I just don’t see how it’s right, regardless of how wealthy this 10% may be – it’s their money, period. The article goes on to say “Obama has pushed tax cuts for low- and middle-income families and tax increases for the wealthy, arguing that wealthier taxpayers fared well in the past decade, so it's time to pay up.” Oh, now it’s time to pay up? As if $0.35 of every $1.00 they make isn’t already enough. That’s insane. Who is he, or anyone, to decide what’s enough?

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