The ‘50 percent pay no tax’ fraud, Part II
I’ve dealt with this claim before, pointing out that the actual number of taxable units (households and individuals) that earn enough to file tax forms but pay no federal income tax is actually 38 percent, not 50 percent. (Source: Factcheck.org)
But let’s add some context to the discussion. First of all, as the Tax Foundation points out, the relatively large percentage of non-income-tax payers is a direct consequence of the Bush tax cuts that conservatives laud in other contexts. As the foundation pointed out in 2004, the number of zero-tax filers “was 29 million in 2000, and it will be 44 million in 2004, a 50 percent increase.” Again, it attributes that change to the Bush administration.
And of course, income taxes are just one of several forms of federal taxation — you’ve got gasoline taxes, payroll taxes, etc. The Congressional Budget Office has analyzed total effective federal tax rates by income, and comes up with the following (2005 numbers):
—————-Average income ————Effective fed tax rate
Lowest 20 percent………$15,900 ……………………4.3 percent
Second 20 percent…….. $37,400…………………… 9.9 percent
Middle 20 percent……….$58,500………………….. 14.2 percent
Fourth 20 percent……….,$85,200………………….. 17.4 percent
Top 20 percent…………..$231.300…………………..25.5 percent
Top 1 percent…………..$1,558,500………………….31.2 percent
And who are the people who don’t pay federal income taxes? Again, according to the Tax Foundation:
“Broadly speaking, the 44 million zero-tax filers are: low-income, young, female-headed households, part-time workers, and beneficiaries of the $1,000 per-child tax credit.
The 44 million zero-tax filers will be largely low-income. Indeed, 75 percent of will earn less than $20,000 per year and 97 percent will earn less than $40,000. Fewer than 1 percent will earn more than $75,000 per year – a group comprised largely of business owners whose tax liabilities will be erased due to business losses, carry-overs from prior year AMT payments, or foreign tax credits.
Zero-tax filers in 2004 will be overwhelmingly young. Looking at the age of the primary breadwinner on these tax returns, only 22 percent are 45 years old or older. More than one-third (36 percent) are younger than age 25, and 56 percent are younger than age 35. Interestingly, there is a large cluster of households (22.4 percent) where the principal wage earner is between the ages of 35 and 44. Most likely, these are modest-income families who are benefitting most from the increased value of the child credit to $1,000.
The racial or ethnic composition of the 44 million zero-tax filers will roughly mirror the demographics of American tax filers as a whole. For example, white Americans are 83 percent of total taxpayers, and the percentage of zero-tax filers who are white is 79 percent. African Americans are roughly 13 percent of total taxpayers and 17 percent of zero-tax filers. Asian Americans comprise 3.6 percent of total taxpayers and 3.4 percent of zero-tax filers.”
In general, then, those who don’t pay federal income taxes tend to be young families with children, often headed by a single mother, where the head of household has a job and is trying to make ends meet on a modest income. The racial background of that population largely mirrors that of the country at large.
Some may believe we should increase the tax burden on that population. Me, not so much. But then I’m officially a commie anyway, according to some of you.
Tell us what you think about the site
Customer Care »
Vacation stops, manage subscriptions and more
AJC Services
Sections
Other Editions
Visitor Agreement | Privacy Statement
© 2013 The Atlanta Journal-Constitution
230 comments Add your comment
Taxpayer
February 24th, 2009
8:55 pm
Fifty percent don’t pay any tax according to the right-wing fringe and there’s only about 33% of them left so why aren’t they happy with the fact that they don’t pay any taxes. Is it because 50%-33% = 17% also don’t pay taxes and they think that they should. This minority party sure is Chock-Full-O-Nuts. They’re just never happy. Well, once Obama tells them about all the spending cuts he’s going to make in the military and all the tax cheats that he’s going to go after, maybe that will make them a little happier. After all, the minority party does want to work on that deficit and the debt like good little conservatives, don’t they.
GodHatesTrash, Superstar
February 24th, 2009
9:01 pm
Gee Mikey, now I’m bigoted towards rural folk?
Mikey, I live in Vermont, remember? I drive by about 25 farms on my seven mile drive to work.
62% of Vermonters live in rural areas. That’s a larger % than any other state in the country. Less than 25% of you Jawjins live in rural areas.
So – last night I was a racist because there aren’t many blacks in VT – so how come tonight I’m bigoted towards rural people when I live in the most rural state in the US?
Stalker boy, you’re just a brainless whiner.
rcs
February 24th, 2009
9:03 pm
Obama’s going after Tim Geithner? That should prove interesting.
GodHatesTrash, Superstar
February 24th, 2009
9:05 pm
I thought Jindal’s given name was Piyush?
What does his birth certificate say? Bobby? Piyush? Is it from the United States?
Do you think it might be a forgery?
Where’s the Corporal when you need him?
Mike
February 24th, 2009
9:05 pm
Trash –
I never said you were a racist. I said that you were a bigot, which you indisputably are.
As I said in my post just a few above this one:
“One guy ascribes hateful and ignorant stereotypes to millions of people based on where they live.”
Thats what you do because you are a vile bigot. Also, I appreciate having my intelligence questioned by hateful and ignorant people like yourself. I would be deeply concerned if bigots respected me.
AJC/DNC Management
February 24th, 2009
9:06 pm
Aahhh, yes, the moron spews.
Remember, whatever it says will be a lie and you can expect the exact opposite to be true.
Keep this in mind as the idiocy begins.
ew
AJC/DNC Management
February 24th, 2009
9:09 pm
Oh, by the way, listen to this denture wearing freak whistle.
ew
rcs
February 24th, 2009
9:12 pm
The President Of Fear.
Not long ago this paper labeled Bush and Rove the fear mongers.
AJC/DNC Management
February 24th, 2009
9:14 pm
I’ll be surprised if the Repugs don’t jeer this dunce like Bruno did to Bushie.
Every time he finishes spewing a sentence, the Repugs should say in unison, “Yeah, right.”
Won’t we all laugh then?
Dave R
February 24th, 2009
9:22 pm
Hey, DB Gwinnett! The source you cited that disses the Galveston PRIVATE RETIREMENT plan is none other than (drum roll please!) the IRS!
Now, why would THEY do that? Hmmmmm?
Again, like Jay-man, you have to READ the WHOLE thing.
Pitiful, just pitiful.
FACTS
February 24th, 2009
9:24 pm
The latest data show that a big portion of the federal income tax burden is shouldered by a small group of the very richest Americans. The wealthiest 1 percent of the population earn 19 percent of the income but pay 37 percent of the income tax. The top 10 percent pay 68 percent of the tab. Meanwhile, the bottom 50 percent—those below the median income level—now earn 13 percent of the income but pay just 3 percent of the taxes. These are proportions of the income tax alone and don’t include payroll taxes for Social Security and Medicare.
CommunistAJC
February 24th, 2009
9:30 pm
Midori
you wrote: and Commie —if you ever grow “up”, please, by all means…………..
Are you going to watch the President’s address tonight?
You have a lot of nerve writing that I grow up because yesterday you said that I like to eat boogers. And yes I am watching President Hussein speak. The socialist is giving a good socialist speech.
Midori
February 24th, 2009
9:32 pm
You wingnuts are just jealous that Obama can put a sentence together without the help of a hammer, nails and a bucket of glue.
Midori
February 24th, 2009
9:37 pm
cheer up, Commie!!
It’s all good!!!
ROFL!!!!
Oblahmi
February 24th, 2009
9:39 pm
Greetings fellow dimwits-
I stand before you today humbled by your trust in me. I find it totally unbelievable and irresponsible of you to leave the keeping of such a great nation in the hands of a moron like me, I am truly awed by your ignorance.
I am happy to report that we have accomplished nearly half of our mission, that being how much is left in the US Treasury, half of what we started with. Do not fret, I will be squandering the remainder of it tomorrow.
And then we will become fiscally responsible, hahahahahahahaha, yeah, ok.
It has been a long hard struggle that we have endured, fellow stooges, destroying this great country was nearly impossible with such strong and frightening men as Reagan and Bushie standing guard over her. But I am relieved to report there is only McCain left and I’m pretty sure he’s cool with our depraved intentions.
From now on, this country will be remolded in our image, the image of losers like you, total failures and psychotics, lazy asses and the lame will rule the day, the time has come for the stunted and stupid to lead us to our cataclysmic destruction.
Can I get an amen?
So go home and do your drugs, break into your neighbors house and pillage his belongings, shoot, rape and murder those that anger you, while you languish in boredom waiting for your bimonthly itty bitty government check to hit the mail box.
Have at it, y’all.
Allah Akbar!
Yes we can!
Midori
February 24th, 2009
9:40 pm
Yes, you can be so bitter about a competent, intelligent president for a change Andy.
I’ll light a candle for you tonight.
Dave R
February 24th, 2009
9:43 pm
Gelding, we’ll make this real clear on the FairTax, so that even YOU can understand it. OK?
The FairTax taxes NEW purchases ONLY. Let’s say you’re an elderly person who is now taking their retirement money out and starting to buy daily items with it. With me so far? Yes, your savings have already been taxed in the past – no argument there. But today, you’re going to pick up a brand new shiny hammer to work on your home, now that you have the time to do so. Today, that hammer costs $1.00 to make. The materials, labor and profit to make it today cost 77 cents. The imbedded tax of all that labor and materials costs 23 cents, so for you math majors out there, that total cost of the hammer under today’s tax structure is $1.00. Still with me, Gelding?
Under the FairTax, that hammer will still cost 77 cents in labor, profit and materials. But instead of the tax being imbedded in the cost, the retailer will now sell it for 77 cents, and the Feds will get their 23 cents via the FairTax. That elderly man will still end up paying his $1.00 for the hammer.
What this says is that the savings of that elderly man will be taxed the same under today’s system, and under the FairTax, so there is double taxation either way you look at it. The FairTax is revenue-neutral, Gelding. Now, if the man wanted to make sure he didn’t get taxed twice, he could go out and buy a used hammer, which would NOT be taxed under the FairTax.
The benefit for him under the FairTax would be in the prebate for his expected expenses for daily needs, which would actually CUT his taxable load under the FairTax.
Now, do you have any other ignorant objections to the FairTax?
CommunistAJC
February 24th, 2009
9:53 pm
Midori,
be careful not to burn your trailer down with that candle.
Midori
February 24th, 2009
9:55 pm
LOL, Commie.
Scared the fire might spread onto your’s?
HAHAHAHAHAHAHAHA
CommunistAJC
February 24th, 2009
9:59 pm
Midori,
oh yes, I’m sure that fire will spread from your trailer to my condo here in Chicago.
HAHAHAHAHAHAAHAHAHA!
CommunistAJC
February 24th, 2009
10:04 pm
Midori,
also, I hear hair weaves burn easily in fire. Watch out.
Greg Mendel
February 24th, 2009
10:59 pm
“Why switch gears to the wars when we were talking about outsourcing.”
Because we’re talking about the same bullshift.
Copyleft
February 25th, 2009
8:34 am
Eric and Tcoach, and others casting about for a “fair” number for the top tax rate:
In the sainted 1950s, the top tax rate was about 90%. As a result, the wealth gap narrowed considerably, and we enjoyed a flourishing growth in the middle class.
The top tax rate should be determined by what percentage of the nation’s wealth that segment controls. Since the top 10% control over 90% of the nation’s wealth, a 90% top tax rate seems entirely fair.
Any objections? Or will you shift the argument to whining about “achievers being punished” now that the “fairness” bit has turned against you?
Dave R
February 25th, 2009
9:37 am
An when the first achiever decides to get out of the job creation market and live off of what he earned, your job can be the first one cut, copyleft.
But let’s not stop there. Since we achievers are funding the bills for those who don’t, maybe we get to vote while those who don’t fund, don’t get to vote. Or maybe, we get 9 votes to your one, since we are picking up the freight.
Any problems with THAT, copyleft?
Copyleft
February 25th, 2009
10:07 am
DaveR, you’re going at it backwards (predictably). Your proposal would skew things even further in favor of the plutocrats. “One dollar, one vote” is already too dangerously close to reality as it is. The progressive tax structure is designed to recognize the wealth gap as a PROBLEM and FIX it, not as an inevitability to be welcomed and services.
The only thing that puzzles me is this: Are you a millionaire yourself? Because if not, why would you support policies that give millionaires even more power, and yourself even less?
Dave R
February 25th, 2009
12:49 pm
And the progressive tax structure is one of the 10 planks Karl Marx identified as being needed to being a successful communist society. Sorry, but I’m not buying that one.
And while I am not a millionaire, I have very desire to become one some day, and when I do, I want to keep every damned penny I EARNED. And if one dollar, one vote was truly close to reality, we would never have President Hope & Change in the Oval Office right now, so how delusional can you be?
Now, if you want to live in a socialist or communist society, fine. There are still a few choices out there – China and North Korea come to mind. But stop trying to change the most successful country in the history of the world into something it was never designed to be, and taking away all that enables it to be great.
When the last person able to create jobs desires to hang it up, what are all you libs gonna do when no one is able to pay your way?
Copyleft
February 25th, 2009
1:50 pm
Tell you what, DaveR… as soon as we start running out of people looking to get rich, I PROMISE to start worrying about it.
I don’t have to leave America to live in a more progressive society, Dave. I can just work to bring America itself closer to that ideal. Looks like you’re choosing to push the opposite direction, but it looks like the voters are on my side for now.
Richard Smyth
February 26th, 2009
2:21 pm
Where’s “part I” implied in your title? Could you add links to your entry so we can find the previous “part” quickly? (I suggest “I dealth with this claim before” as the link phrase…). Thanks.
My plan for jump starting the economy. It will work almost instantly. - Page 2 - InterNACHI Message Board
March 3rd, 2009
2:43 pm
[...] Impossible Will as almost every product purchased from electricity to food is taxed. Just another myth. Sorry for my lack of clarity. 47% of the citizenry pay no Federal Income Taxes. And with the [...]
Interesting voter demographic vs voting - Politics and Other Controversies - City-Data Forum
July 10th, 2009
9:43 pm
[...] Originally Posted by Katiana I’d like to see some verification that 50% of people pay no income taxes. Is that counting kids under 18 or what? Everyone I know pays them. If you are including people who got a refund, rmember that just means they over-paid, not that they didn’t pay at all. According to this article, it’s actually 38%. The article also points out that the number dramatically increased after the Bush tax cut. And many of them are "low-income, young, female-headed households, part-time workers, and beneficiaries of the $1,000 per-child tax credit." Not to mention that they do pay payroll taxes. The lie that ‘50 percent pay no tax,’ Part II | Jay Bookman [...]