POLITICS: The Rich Are Over-Taxed

As part of her equality-of-outcomes agenda, Kamala Harris wants to impose lots of soak-the-rich tax increases on investors, entrepreneurs, business owners, and other upper-income taxpayers.

Here’s a partial list (for the full list of class-warfare tax hikes, click here and here).

• Higher capital gains tax rates (the right rate is zero)
• Higher personal income tax rates (rates should be as low as possible)
• Increased double taxation of dividends (the right rate is zero)
• Higher corporate income tax rates (the rate should be as low as possible)
• Tax on unrealized gains (there should be no backdoor wealth tax)
• Increased death tax burden (there should be no taxation upon death)

The Vice President and her team say higher taxes are necessary so the rich pay their “fair share.”

But this raises the very obvious question of what is a fair share? The Tax Foundation looked at the most-recent IRS data and showed that the top 1 percent of taxpayers already are paying nearly 46 percent of income taxes while the bottom half of the population only paid 2.3 percent.

By the way, it’s been this way for a while. I wrote back in 2016 that folks on the left should applaud rich people since they are the ones who finance America’s welfare state.

Sticking with this topic, here are some excerpts from a Wall Street Journal editorial from back in March.

Recently released figures for 2021 show that the top 1% of Americans…paying 45.8% of total income taxes. Is this not a “fair share”… The truth is that the income tax is already steeply progressive. The top 10% of earners in 2021 provided 75.8% of the revenue. …the bottom half of earners…paying 2.3% of all income taxes. Their average tax rate was 3.4%. …The burden of income taxes, in other words, falls almost entirely on the top half of earners and disproportionately on the top 1%. …tax rates rise steadily with income, a basic feature of a progressive code. The average income tax take is 10% or less for the middle class, which jumps to more than 25% for the highest earners. …Taxing the rich is popular these days, in part because Republicans are now playing the same tax redistribution game as Democrats. The problem in Washington isn’t that the rich refuse to pay their “fair share,” whatever that means. The trouble is that…spending ambitions are limitless. Washington could confiscate the income of every billionaire in the country and still not finance what Democrats want to spend.

I’ll close by reiterating that “soaking the rich” is not the solution to America’s fiscal woes. Simply stated, there are not enough of them and the economic consequences would be terrible (meaning much less revenue than politicians would be hoping for).

But I’ll also make the should-be-obvious point that we don’t want to be like Europe with stifling tax burdens on lower-income or middle-class households.

See also

Politics

·09/15/2024·0

POLITICS: GOP Lawmakers Fight Biden Over Global Health Agreement

The fiscal problem in America is a federal government that is too big and growing too fast. To protect all Americans from being fleeced by Washington, we need to put Uncle Sam on a diet with a spending cap.

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