Taxes Plunge for Rich
As my grandfather used to say, "rich or poor, it's nice to have money!" According to data from the IRS, taxes on the rich have dropped dramatically over the past two decades. To see just how much, check out this segment:
Moments after I appeared on set, I received the following (angry) e-mail:
It is a shame that in this morning's broadcast you chose to cherry pick statistics to frame the tax "debate"...if you wanted to frame a debate, you could have added the statistics that 50% of the country pays no federal income tax...or if you were bent on speaking to the top 1% and top 5% of earners, perhaps you could have quoted the % of earnings and % of tax paid by these bands...in both cases, the latter exceeds the former. With your affiliations, it is not surprising to see you frame the debate with stats that only favor one side, but an objective reporter may have chosen to at least add some balance.So I went back to IRS data from 2007, because that was the end-year of the recent report, that was the basis of the television segment. Here's what I found: the top 1 percent of taxpayers paid 40.4 percent of the total income taxes collected by the federal government and the bottom 95 percent paid 39.4 percent of the income tax burden.
This is the definition of a progressive tax system: the wealthier pay a larger share than everyone else. I think the e-mailer's point is that the rich bear too much of the burden. But that may not be the case when including payroll taxes, which are mostly paid by those with incomes below $100,000 per year. That's why Warren Buffett famously said that he was taxed at 17.7 percent on his taxable income of more than $46 million, which his receptionist was taxed at about 30 percent. Let's also remember that wealthy Americans have done quite well over the past few decades. From 1980 to 2005, more than 80 percent of total increase in Americans' income went to the top 1 percent.
So I thank the e-mailer for sending me the note, because it allowed me to take a bit more time than the few minutes on television, to further flesh out all of the numbers.