Thursday, March 29, 2007

Do Not Expect A Tax Cut If You Do Not Pay Any Tax

I saw a bumber sticker on the way into work this morning on a lower cost compact car, "I do not earn enough for a tax cut". Since everyone who actually paid federal tax got a tax cut, the bumper sticker should have said "I do not earn enough to pay taxes". The reality is, most people are not tax payers of federal tax. When I hear people complaining about "tax cuts for the rich" I correct them by saying tax cuts for the taxpayers. It is kind of hard to cut your taxes when you do not pay taxes. I saw this from Dan's Show Prep Blog that says:
Overall, we find that America's lowest-earning one-fifth of households received roughly $8.21 in government spending for each dollar of taxes paid in 2004. Households with middle-incomes received $1.30 per tax dollar, and America's highest-earning households received $0.41. Government spending targeted at the lowest-earning 60 percent of U.S. households is larger than what they paid in federal, state and local taxes. In 2004, between $1.03 trillion and $1.53 trillion was redistributed downward from the two highest income quintiles to the three lowest income quintiles through government taxes and spending policy.

Lets say we go out to dinner and the bill is $40 and I decide to pay for both meals and hand the waitress a $100 bill. Who should get the change? Why I should of course, I am the one who paid. How are tax cuts any different?

1 comment:

Anonymous said...

This concept is lost on the socialists who want to take ALL the money from the rich.

Once that's done they will go after everyone else.