From: Mike Lorrey (mlorrey@yahoo.com)
Date: Mon Mar 24 2003 - 12:19:25 MST
It is now a fact that the top 50% of wage earners in the US pay over
96% of income taxes. Despite the fact that this link is at Rush
Limbaughs website, I have found its numbers to be accurate. I am using
it because it is in an easily emailed format.
http://www.rushlimbaugh.com/home/menu/irsfigures.guest.html
I have included the raw data at the end of this post.
What is interesting is what is signified by a person at the 50
percentile level, which in 2000 was a little over $27,000. The Constant
Dollars data shows that the trend through the 80's and early 90's of
real income decay is ended.
The key point that Rush was making in presenting this data, and which
I've made here on occasion, is that claims by the left that the GOP is
only for tax cuts for the rich is a false argument, because the 'rich'
as defined by the left, are the only people who pay the taxes in the
first place. However, one interesting thing is that this seems to have
always been the case. The figures for 1986 show that the top 50% paid
around 94% of all income tax. It seems to appear that welfare reform
didn't shift so many people off the welfare roles as much as automated
and deregulated the welfare system, as well as making it more equitable
and progressive. You no longer have to be unemployed to be on welfare.
Why this data is as it is can be shown by comparing the figures to the
thresholds for the Earned Income Tax credit, which cuts off at around
$31,000. If you aren't paying taxes, you are on welfare, is essentially
the argument, and large percentages of the income of the top 50% is
being redistributed via the EITC to the lower 50%.
On the positive side, this is taking place without some onerous
bureaucracy of social workers, means testers, and fraud investigators
parasitizing on top. You get or give a check based on your income,
point blank. The computer network takes care of all of it. There are no
rules that disqualify you if you own a car or have some savings or
investments, or are self employed.
On the negative side, it imposes a stark polarity onto society that
translates to the political arena. If you get a check from the
government, and you have dependents, you are more likely to vote for
the candidates that are going to keep that money coming in. If you pay
a check to the government, you are more likely to vote for candidates
that are going to minimize that check as much as possible.
With the 50 percentile level at $27,000 and the cutoff for the EITC
around $4,000 higher than that, this means that more than 50% of
American workers are on welfare. This bodes ill for libertarian hopes
when more than half the populace is on the government dole.
What is also interesting is that the top 1% pay about a third of all
income taxes. They can't help but benefit the most from tax cuts,
unless a tax cut is unfairly targeted to only to expand that 53% that
is on welfare and paying no income taxes whatsoever.
It is a fine box that tax cutters are in. If you evenly apply a tax
cut, the rich get the most benefit, and the EITC payouts to the sub-53%
may get reduced. If you cut other taxes, like the payroll tax (i.e.
social security), you get whacked for messing with the 'third rail of
American politics' and you still come out looking like a meany, picking
on old people.
Given that there is no longer a surplus, the idea of any tax cut
passing has zero glide time. It is mated on the strategy board until
such time as the rook of revinues backs off once again, and technology
provides expanding revinue pictures once again. The fact that so few
businesses are upgrading their systems and software (and so little new
versions of software provide any measurable productivity increases)
bodes ill for this possibility in the near future.
Ah, dynamic scoring, you say. The difficulty is that dynamic scoring
presents an ever expanding locus of possible future revinues, as anyone
who viewed the coverage of the congressional tax cut hearings in 2001
can attest. Furthermore, it can't fortell future events like 9/11,
which has rather seriously changed the entire revinue dynamic for years
to come. It also has difficulty dealing with false data in the market,
like Enron. Who thinks they are the Muad'dib who can sift the timelines
to find the true future?
Read on..
Mike Lorrey
"Tax is slavery" - Mike Lorrey
Income Tax: Who Pays? IRS Figures for 2000
Table 1. - Individual Income Tax Returns with Positive Adjusted Gross
Income (AGI): Number of Returns, Shares of AGI andTotal Income Tax, AGI
Floor on Percentiles in Current and Constant Dollars, and Average Tax
Rates, by Selected Descending Cumulative Percentiles of Returns Based
on Income Size Using the Definition of AGI for Each Year, Tax Years
1986-2000 [All figures are estimates based on samples]
Descending cumulative percentiles
Year: Total.....Top 1%.....Top 5%.....Top 10%.....Top 25%.....Top 50%
Number of returns: [1]
1986:
102,087,623...1,020,876..5,104,381..10,208,762..25,521,906..51,043,811
1987:
106,154,761...1,061,548..5,307,738..10,615,476..26,538,690..53,077,380
1988:
108,872,859...1,088,729..5,443,643..10,887,286..27,218,214..54,436,429
1989:
111,312,721...1,113,127..5,565,636..11,131,272..27,828,181..55,656,361
1990:
112,812,262...1,128,123..5,640,613..11,281,226..28,203,066..56,406,132
1991:
113,804,104...1,138,041..5,690,205..11,380,410..28,451,026..56,902,052
1992:
112,652,759...1,126,528..5,632,638..11,265,276..28,163,190..56,326,380
1993:
113,681,387...1,136,814..5,684,069..11,368,139..28,420,347..56,840,694
1994:
114,989,920...1,149,899..5,749,496..11,498,992..28,747,480..57,494,960
1995:
117,274,186...1,172,742..5,863,709..11,727,419..29,318,546..58,637,093
1996:
119,441,767...1,194,418..5,972,088..11,944,177..29,860,442..59,720,884
1997:
121,503,284...1,215,033..6,075,164..12,150,328..30,375,821..60,751,642
1998:
123,775,831...1,237,758..6,188,792..12,377,583..30,943,958..61,887,915
1999:
126,008,974...1,260,090..6,300,449..12,600,897..31,502,244..63,004,487
2000:
128,227,143...1,282,271..6,411,357..12,822,714..32,056,786..64,113,572
Adjusted gross income floor on percentiles (current dollars):
1986: N/A......118,818......62,377......48,656......32,242......17,302
1987: N/A......139,289......68,414......52,921......33,983......17,768
1988: N/A......157,136......72,735......55,437......35,398......18,367
1989: N/A......163,869......76,933......58,263......36,839......18,993
1990: N/A......167,421......79,064......60,287......38,080......19,767
1991: N/A......170,139......81,720......61,944......38,929......20,097
1992: N/A......181,904......85,103......64,457......40,378......20,803
1993: N/A......185,715......87,386......66,077......41,210......21,179
1994: N/A......195,726......91,226......68,753......42,742......21,802
1995: N/A......209,406......96,221......72,094......44,207......22,344
1996: N/A......227,546......101,141.....74,986......45,757......23,174
1997: N/A......250,736......108,048.....79,212......48,173......24,393
1998: N/A......269,496......114,729.....83,220......50,607......25,491
1999: N/A......293,415......120,846.....87,682......52,965......26,415
2000: N/A......313,469......128,336.....92,144......55,225......27,682
Adjusted gross income floor on percentiles (constant dollars): [2]
1986: N/A......108,411......56,913......44,394......29,418......15,786
1987: N/A......122,614......60,224......46,585......29,915......15,641
1988: N/A......132,828......61,484......46,861......29,922......15,526
1989: N/A......132,152......62,043......46,986......29,709......15,317
1990: N/A......128,096......60,493......46,126......29,135......15,124
1991: N/A......124,919......60,000......45,480......28,582......14,756
1992: N/A......129,654......60,658......45,942......28,780......14,828
1993: N/A......128,522......60,475......45,728......28,519......14,657
1994: N/A......132,069......61,556......46,392......28,841......14,711
1995: N/A......137,406......63,137......47,306......29,007......14,661
1996: N/A......145,026......64,462......47,792......29,163......14,769
1997: N/A......156,222......67,320......49,353......30,014......15,198
1998: N/A......164,427......69,999......50,775......30,877......15,553
1999: N/A......176,119......72,537......52,630......31,792......15,855
2000: N/A......182,038......74,527......53,510......32,070......16,075
Adjusted gross income (millions of dollars):
1986:
2,524,124...285,197...608,467...886,510......1,490,173......2,103,569
1987:
2,813,728...346,635...722,221...1,038,221....1,709,389......2,373,869
1988:
3,124,156...473,527...890,702...1,232,536....1,950,860......2,657,865
1989:
3,298,858...468,079...918,421...1,286,539....2,054,478......2,805,235
1990:
3,451,237...483,252...953,337...1,338,032....2,144,177......2,932,537
1991:
3,516,142...456,603...943,350...1,343,202....2,174,765......2,984,003
1992:
3,680,552...523,586...1,031,093.1,443,784....2,299,401......3,131,400
1993:
3,775,578...520,586...1,048,252.1,474,463....2,357,953......3,212,299
1994:
3,961,146...546,700...1,103,084.1,552,205....2,481,074......3,371,352
1995:
4,244,607...619,610...1,222,723.1,704,513....2,689,820......3,627,542
1996:
4,590,527...736,545...1,393,805.1,909,149....2,952,637......3,944,383
1997:
5,023,457...872,826...1,597,107.2,151,401....3,267,600......4,327,992
1998:
5,469,211..1,010,245..1,796,647.2,393,716....3,589,600......4,721,430
1999:
5,909,329..1,152,820..2,011,763.2,652,835....3,927,308......5,126,164
2000:
6,423,977..1,336,773..2,267,403.2,955,386....4,313,786......5,589,755
Descending cumulative percentiles
Year: Total.....Top 1%.....Top 5%.......Top 10%....Top 25%....Top 50%
Total income tax (millions of dollars): [3]
1986:
366,979......94,491......156,240......200,703......278,976......343,289
1987:
369,046......91,559......159,642......205,230......283,857......346,655
1988:
412,761......113,841......188,303......236,411......321,297.....389,145
1989:
432,838......109,259......190,188......241,458......334,258.....407,599
1990:
447,061......112,338......195,088......247,514......344,340....421,075
1991:
448,349......111,267......194,480......250,282......346,511.....423,759
1992:
476,163......131,156......218,479......276,213......373,700.....452,070
1993:
502,720......145,836......238,083......297,808......398,516.....478,563
1994:
534,754......154,337......254,106......317,902......425,402.....509,256
1995:
588,331......178,035......287,741......357,402......472,808.....561,225
1996:
658,124......212,626......335,433......411,404......535,164.....629,684
1997:
727,303......241,239......377,241......459,639......594,007.....696,161
1998:
788,452......274,009......424,506......512,836......651,964.....755,240
1999:
877,292......317,419......486,464......583,002......732,890.....842,168
2000:
980,521......366,929......553,670......660,150......823,706.....942,179
Average tax rate (percentage): [4]
1986: 14.54......33.13......25.68......22.64......18.72......16.32
1987: 13.12......26.41......22.10......19.77......16.61......14.60
1988: 13.21......24.04......21.14......19.18......16.47......14.64
1989: 13.12......23.34......20.71......18.77......16.27......14.53
1990: 12.95......23.25......20.46......18.50......16.06......14.36
1991: 12.75......24.37......20.62......18.63......15.93......14.20
1992: 12.94......25.05......21.19......19.13......16.25......14.44
1993: 13.32......28.01......22.71......20.20......16.90......14.90
1994: 13.50......28.23......23.04......20.48......17.15......15.11
1995: 13.86......28.73......23.53......20.97......17.58......15.47
1996: 14.34......28.87......24.07......21.55......18.12......15.96
1997: 14.48......27.64......23.62......21.36......18.18......16.09
1998: 14.42......27.12......23.63......21.42......18.16......16.00
1999: 14.85......27.53......24.18......21.98......18.66......16.43
2000: 15.26......27.45......24.42......22.34......19.09......16.86
Adjusted gross income share (percentage):
1986: 100.00......11.30......24.11......35.12......59.04......83.34
1987: 100.00......12.32......25.67......36.90......60.75......84.37
1988: 100.00......15.16......28.51......39.45......62.44......85.07
1989: 100.00......14.19......27.84......39.00......62.28......85.04
1990: 100.00......14.00......27.62......38.77......62.13......84.97
1991: 100.00......12.99......26.83......38.20......61.85......84.87
1992: 100.00......14.23......28.01......39.23......62.47......85.08
1993: 100.00......13.79......27.76......39.05......62.45......85.08
1994: 100.00......13.80......27.85......39.19......62.64......85.11
1995: 100.00......14.60......28.81......40.16......63.37......85.46
1996: 100.00......16.04......30.36......41.59......64.32......85.92
1997: 100.00......17.38......31.79......42.83......65.05......86.16
1998: 100.00......18.47......32.85......43.77......65.63......86.33
1999: 100.00......19.51......34.04......44.89......66.46......86.75
2000: 100.00......20.81......35.30......46.01......67.15......87.01
Total income tax share (percentage):
1986: 100.00......25.75......42.57......54.69......76.02......93.54
1987: 100.00......24.81......43.26......55.61......76.92......93.93
1988: 100.00......27.58......45.62......57.28......77.84......94.28
1989: 100.00......25.24......43.94......55.78......77.22......94.17
1990: 100.00......25.13......43.64......55.36......77.02......94.19
1991: 100.00......24.82......43.38......55.82......77.29......94.52
1992: 100.00......27.54......45.88......58.01......78.48......94.94
1993: 100.00......29.01......47.36......59.24......79.27......95.19
1994: 100.00......28.86......47.52......59.45......79.55......95.23
1995: 100.00......30.26......48.91......60.75......80.36......95.39
1996: 100.00......32.31......50.97......62.51......81.32......95.68
1997: 100.00......33.17......51.87......63.20......81.67......95.72
1998: 100.00......34.75......53.84......65.04......82.69......95.79
1999: 100.00......36.18......55.45......66.45......83.54......96.00
2000: 100.00......37.42......56.47......67.33......84.01......96.09
N/A-- Not applicable.
[1] The number of returns with negative adjusted gross income, i.e.,
returns with an adjusted gross deficit, and the corresponding amounts
for adjusted gross deficit, were excluded from Table 1. By excluding
deficit returns, alternative minimum tax reported on some of these
returns was also excluded. For Tax Year 2000, there were 5,714 returns
with no adjusted gross income that reported income tax, mostly
alternative minimum tax, totaling $100.6 million.
[2] For Table 1, constant dollars were calculated using the U.S. Bureau
of Labor Statistics' consumer price index for urban consumers (CPI-U,
1982-84=100). For 2000 the CPI-U = 172.2
[3] Total income tax is the sum of income tax after credits and
alternative minimum tax reported on returns that showed a positive
amount for adjusted gross income. Therefore, total income tax excludes
alternative minimum tax, Form 8814 tax (tax on a child's interest or
dividends), and Form 4972 tax (tax on lump-sum distributions from
qualified retirement plans) reported on some returns with a negative
amount for adjusted gross income. See also footnote 1.
[4] The average tax rate was computed by dividing total income tax (see
footnote 3) by (positive) adjusted gross income.
Note: Unles otherwise stated, money amounts are in current (not
constant) denominations.
Source: Internal Revenue Service, Statistics of Income Division,
Unpublished Statistics, September 2002.
=====
Mike Lorrey
"Live Free or Die, Death is not the Worst of Evils."
- Gen. John Stark
"Pacifists are Objectively Pro-Fascist." - George Orwell
"Treason doth never Prosper. What is the Reason?
For if it Prosper, none Dare call it Treason..." - Ovid
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