Not only that, but they also pretend that it's some static 20%. Not true. I've been in both the top 1% and the bottom 10% in my mid-20s.

We're all in this together. Let's work hard to make it better for everyone and let's be happy to pay higher taxes when we're winning and let's be grateful that there is help when we're struggling. Let's let some have a nicer life if they're working really hard, but let's also make sure that we all get help when we need it.

Do you think the current tax rate in the USA is not high enough for the highest tax bracket?

I'm not the parent commenter, but I would say that given the bottom 20% pays an effective rate of ~20%, an effective rate of ~34% for the top 1% is pretty low, relatively speaking.

But the effective rate gets much closer to 50% as your income goes higher and higher, no?

Within that 1%, you have people who make several hundred thousand dollars a year (I think they make up the majority of the 1%?), and their effective tax rate is closer to 34%. Whereas those who make millions a year, their effective rate is much higher, closer to 50%. Unless my math is off.

I doubt the people who make millions a year pay 50%. Those people tend to be good at structuring much of their income as capital gains, which is taxed much lower. Even tax on regular income tops out at about 43% including payroll taxes. It could go higher if you include other taxes such as sales taxes or state income taxes.

In Germany the curve is strange too.

When going from a low income to a medium income you get the steepest changes, then it flattens when you move into a high income.

I thought the article was pretty unbiased. It clearly states this is income taxes. They are quoting the OMB report word-for-word.

Social Security is an Income tax.

Pretending otherwise is biased.

PS: Federal 'income' taxes amount to less than 1/4 of total US tax revenue and less than 1/2 of federal tax revenue.

The headline and most of the article says "taxes" without the "income" qualifier. "Top 20% pay 95% of taxes." That's flat-out wrong.

This is the Washington Examiner. They exist to be a conservative mouthpiece. Not a single thing they write is unbiased or even has any pretensions to be.

If the same words were penned under the Washington Post banner, would they still be conservatively biased?

Yes. Lying that the rich pay a disproportionate amount of taxes is clear right-wing bias no matter who prints it.

What if the CBO prints it?

> Households in the highest income quintile received a little more than half of total before-tax income and paid more than two-thirds of all federal taxes in 2013 (see Figure 1). Households in other income groups received considerably smaller shares of before-tax income and paid considerably smaller shares of federal taxes.

https://www.cbo.gov/publication/51361

I imagine that "more than two thirds of all federal taxes" is actually correct. There are two important differences from the article: "more than two thirds" is dramatically lower than "95%," and "all federal taxes" is not the same as "taxes."

I'm complaining about a media outlet lying by pretending that the federal income tax is the only tax that matters. You've responded by linking to a CBO publication that considers other taxes, not just income tax. That reinforces my point.

From that CBO link...

> In this report, CBO analyzed the distribution of four types of federal taxes: individual income taxes, payroll (or social insurance) taxes, corporate income taxes, and excise taxes.

So it's not like it's including sales or property taxes or whatever else. For all intents and purposes, that's "income" tax.

And the report is from 2013. This Washington Examiner article explicitly states (with a WSJ link for source) that the disparity has dramatically widened in recent years:

> That may be the highest ever. Just two years ago, it was 84 percent, according to the Wall Street Journal.

(https://www.wsj.com/articles/top-20-of-earners-pay-84-of-inc...)

Federal income tax provides nearly half of all federal revenue. It's not the only tax that matters, but it's certainly the most important and most visible. And any reforms will have the most impact to average citizens of any tax reform.

Yes, that report doesn’t include all taxes. It’s also completely up front about it. It says “federal taxes” in the title and throughout the article.

I have no problem with analyzing a subset of taxes. I have a problem with analyzing a subset of taxes and lying about it by just saying “taxes.”

Ignoring social security which caps at relatively low incomes and makes up such a high portion of federal taxes makes your analysis meaningless.

Compare someone making 1 billion per year in capital gains from foreign investments vs someone making 30k per year in social security.

The article's bias is clear by the end of the title. They know many people won't get past that.

It also doesn’t help that his analysis leaves out the massive skew of income to the top 1% of that 20%. Obviously the middle quintile doesn’t pay much of the total pie, but that’s only because it’s share of income is so small to begin with.

If you include capital gains tax, I'd venture that it'll be even more than 95%.

You would be quite wrong. If you count all taxes, rather than cherry-picking the most progressive ones, the top 20% pays about 2/3rds of all taxes. They also earn about 2/3rds of all income. The total tax rate in terms of all tax paid divided by income earned is remarkably flat: the bottom 20% has an effective rate of about 20%, and the top 1% has an effective rate of about 34%.

See: http://ctj.org/pdf/taxday2015.pdf

Capital gains is taxed well below the normal tax rate so it really does not add up to as much as you might think. "As a share of total federal revenue from all sources, capital gains taxes averaged about 4.2 percent from 1995 through 2009." https://pocketsense.com/percent-irs-revenue-comes-capital-ga...

Further, it's skipped when someone inherits money making death a massive tax break.

PS: 34% of federal revenue comes from payroll taxes which are very regressive, 47% from income taxes which include capital gains which are progressive. Net result a surprisingly flat effective tax rate.

> Include sales taxes

Make more money -> spend more money -> pay a lot in sales taxes.

> payroll taxes

Make more money -> pay more in payroll taxes

> pretending that "tax" and "income tax" mean the same thing.

I dunno about you, but income taxes take the biggest bite out of my ass. You're right that the top 20% doesn't pay 95% of _all_ taxes combined, but I guarantee you they pay far more than 20%. More than 50%, even. What point are you trying to make? That the top 20% don't pay enough in taxes?

I'm not the GP, but the point I would make is that the top 20% pay an appropriate amount of tax commensurate with their (our) income. They (we) pay about two-thirds of all taxes, and make about two-thirds of all income. So headlines claiming that they (we) pay disproportionately-high taxes are trying to make a point, and lying to do so.

As another commenter said, if income taxes are your biggest bite, that says more about you than you realize. Depending on what you earn, FICA often ends up being the biggest bite at 15.3% of every dollar your earn. For some people, sales tax could be the biggest bite, or at least a bigger bite than income tax.

> I dunno about you, but income taxes take the biggest bite out of my ass.

If that's true, it's because you're in the top 20%. The average person pays far more in payroll tax than income tax, not to mention other taxes. Remember, payroll tax is 15.3% starting from the first dollar of income. There are no deductions like there are for income tax. And payroll tax goes down to 2.9% on earnings above $127,200/year.

The median wage in the US is around $45,000/year. A single person making that much money with no dependents and no special deductions will pay about $4,700/year in federal income tax and about $7,000/year in payroll taxes. Dependents and other deductions will cut the income tax amount but will not touch the payroll tax.

And even if it did include property taxes and such paid by rich people who own land, it wouldn't include the fact that such payments are funded by the rents paid by the poor people who rent the land.

Isn't sales tax a local government thing? I didn't think it applied at the federal level, save for very specific items like cigarettes.

Also, what do you mean by "payroll tax"?

Yes, sales tax is not federal. It's still a tax that people pay. To talk about "95% of taxes" and exclude sales tax is dishonest.

Payroll tax is the Social Security and Medicare taxes. It's 15.3% up to $127,200/year with no deductions (i.e. the very first dollar you earn is taxed at that rate), then it drops to 2.9%. People typically don't realize how much it is because it's split into an employee and an employer half. The number printed on your paycheck will only show a 7.65% rate, but the employer is also paying another 7.65%.

Question: If there was no employer side of FICA, is it likely that employees in the bottom 80% get a higher paycheck, since the employer has more money available? Or would most businesses invest that in other areas? Because otherwise you can also consider all other corporate taxes as taxes on employees, because without them there is more that they can spend on payroll.

Edit: I'd also like to explore what would happen if the entire 15% is invested in a 401k equivalent instead of receiving social security / medicare, how much more the average person would get in retirement.

I think payroll taxes are different from other corporate taxes in that they are a direct tax on wages, and thus directly increase the business's cost of labor. Businesses don't really care what part of their labor costs are taxed on their end, what part is taxed on the other end, what part goes to various benefits, etc. They just care that it costs them $X for a given employee.

It is quite possible that reducing the employer side of FICA wouldn't translate into a 1-to-1 higher paycheck, or even any increase at all. But the same is true of the employee's side, or of regular income tax, or any other tax.