How Much Taxation Would Fund Current Spending? (You're not going to want to know the

[Wehrwolfen]

How Much Taxation Would Fund Current Spending? (You're not going to want to know the answer)​

By: Justin Hohn
12/12/2012


To best understand this spending aspect of the current budget negotiations in Washington, we must answer one crucial question: how much taxation on the top income-earners would be required to fully fund the present level of government spending?

To do so, we must first make the unreasonable assumption that the rich will not respond to confiscatory tax rates and hide money from being taxed. This is unreasonable because no scheme of taxation since WW2 has been able to capture more than 21% of GDP. With current spending levels around 23% of GDP, history suggests that no level of taxation we have yet tried would actually fully fund our current level of spending. But if we indulged some "static scoring" and assumed a static tax base, what would a zero-deficit, soak-the-rich taxation scheme look like at current spending levels?

For example, what would a 100% income tax on all those who earn over $10 million amount to? I'm not taking about a wimpy marginal rate, where one might tax only those dollars of income over $10 million (leaving the taxpayer $10 million). No, I'm saying you find all those who made more than $10 million and take every last penny -- an absolute tax of 100%.

Using 2009 data, the IRS says that 8,274 tax returns were filed with incomes over $10 million. The total amount of income on those returns was $240.1 billion.

Our federal government alone is spending more than $10 billion a day. Thus, a 100% confiscation of all income of those making more than $10 million would amount to less than 24 days of federal spending.

If we drop that "tax" point down to $1 million, the picture changes radically. The IRS says 236,883 Americans filed returns with more than $1 million in income.

Confiscating 100% of the income from those who made more than $200K funds the federal government for only about six months.


Read more:
Articles: How Much Taxation Would Fund Current Spending?

 

[OKTexas]

The left don't care, the rich ones are moving offshore, can you say Google, saved 2 billion in taxes, hell that could have payed for what, 1.3 hours of government. But what the hell I don't care, I'll be dead before the bills come due. Let the next generation figure it out.

 

[g5000]

If you eliminated all tax expenditures, every one of them, you would balance the budget. You would not have to do a single additional thing. You would not have to change tax rates, you would not have to cut entitlement spending, you would not have to cut defense spending.

That's how big tax expenditures, the gifts we all get from Uncle Santa, are.

.

 

[Freemason9]

How Much Taxation Would Fund Current Spending? (You're not going to want to know the answer)​

By: Justin Hohn
12/12/2012


To best understand this spending aspect of the current budget negotiations in Washington, we must answer one crucial question: how much taxation on the top income-earners would be required to fully fund the present level of government spending?

To do so, we must first make the unreasonable assumption that the rich will not respond to confiscatory tax rates and hide money from being taxed. This is unreasonable because no scheme of taxation since WW2 has been able to capture more than 21% of GDP. With current spending levels around 23% of GDP, history suggests that no level of taxation we have yet tried would actually fully fund our current level of spending. But if we indulged some "static scoring" and assumed a static tax base, what would a zero-deficit, soak-the-rich taxation scheme look like at current spending levels?

For example, what would a 100% income tax on all those who earn over $10 million amount to? I'm not taking about a wimpy marginal rate, where one might tax only those dollars of income over $10 million (leaving the taxpayer $10 million). No, I'm saying you find all those who made more than $10 million and take every last penny -- an absolute tax of 100%.

Using 2009 data, the IRS says that 8,274 tax returns were filed with incomes over $10 million. The total amount of income on those returns was $240.1 billion.

Our federal government alone is spending more than $10 billion a day. Thus, a 100% confiscation of all income of those making more than $10 million would amount to less than 24 days of federal spending.

If we drop that "tax" point down to $1 million, the picture changes radically. The IRS says 236,883 Americans filed returns with more than $1 million in income.

Confiscating 100% of the income from those who made more than $200K funds the federal government for only about six months.


Read more:
Articles: How Much Taxation Would Fund Current Spending?

We spend about 10x too much on defense, so we can save a bunch there. Also, if we eliminate ALL welfare payments (including disability, farm subsidies, social security, veteran's "benefits," etc.), I'm certain we can balance the budget. That would happen right before the American psychopathic right wing aristocracy installs the Modern Feudal Great State; shortly after that, the "masses" will overthrow the American aristocracy and we will start all over again.

 

[Freemason9]

Oh, also, you referred to "taxable income" in reference to tax returns to the IRS. You DO realize, of course, that a huge percentage of actual income never shows up as taxable income, right? That's why a "flat tax" would never work, because psychopaths like Donald Trump would never show any real income.

Horrible government, horrible economic system, horrible leadership.

 

[NYcarbineer]

The sum total of federal income tax revenues annually are just about equal to the sum total of annual defense spending,

so, if you were to eliminate everything else (which of course would be impossible)

you couldn't cut income taxes at all from where they are now,

if you wanted a balanced budget.