Post reblogged from Squashed with 1 note
To tax or not?
There has been some interesting discussion on the increasingly high percentage of people who pay little or no federal taxes. Should this be the case? If you are making $15,000 a year, should you have to sign over miniscule small portion of that to the federal government as a gesture? Would it matter if the effort of collecting that portion is larger than the revenue it would generate?
I could see this one going either way. I would like people to feel like they have a larger stake in the government. On the other hand, if it’s not worth the money it would take to collect it, it seems like a principle would be satisfied, but nobody woudl be better off.
I think the article linked to actually understates the current situation. About 15% of taxpayers had a negative federal income tax liability in 2006 (estimate from data here and here), thanks to the Earned Income Tax Credit.
That said, everyone, regardless of income, pays Social Security and Medicare taxes, as well as sales tax (and - either directly or indirectly - property tax). So I don’t think the argument holds much merit. Additionally, I’m a big fan of the EITC and the way it phases in as income increases from zero, and then phases out as income approaches the threshhold.
(Random, nerdy tax diversion - I wish the government would make it easier to withhold taxes appropriately! I’ve done volunteer tax returns for a few years in a low-income neighborhood, and it’s amazing how much tax these people have withheld from their paychecks, even though they end up with zero or negative tax liabilities. I can’t blame them… even knowing the law very well, I always end up over withholding by a great deal).
Source: squashed
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2arrs2ells reblogged this from squashed and added:
actually understates the current situation. About 15%...taxpayers had a negative federal...
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