Someone making more money should never have a lower tax rate than someone making less.

[cbdo2007]

It really is that plain and simple. It's black and white. Sure, they can still get certain deductions or whatever, but the lowest rate someone should be able to get down to is the top of the level below them.

Income is income. It shouldn't matter where it comes from and there should be no circumstance ever where someone making $42,000,000 is paying a lower tax rate than I am making $29,000.

Besides the President, the Democrats in Congress need to step up to the plate here and start making some big changes here.

[lacrew]

1. Changes are Scheduled to Happen Automatically

Current short term rate of 35% and long term rate of 15% will automatically change in 2013 tax year, unless congress acts - to a max of 39.6% short term and 20% long term.

It will not change beyond that, without action in both houses of Congress....which is very unlikely to happen.

As an aside, I make $75k, all income. I pay 6.6% federal income tax, and (usually) 6% SS tax, and 1.5% medicare...for a rate of 14.1%. This is how it shakes out after 401k, standard deductions, etc. I think you would be hard pressed to find an 'average Joe' who paid a substantially higher rate than the millionaires in our ruling class....until you get into the $180k income range....so this becomes a very complex argument.

[Major Nikon]

3. You don't need that much income to pay a higher rate than Romney paid

FICA taxes equal 7.65% for most and twice that for someone who is self employed. So someone who is self employed and has less income than the SS cutoff would already be paying a higher rate than Romney just in payroll taxes alone. For those who earn all their income in wages, and pay 7.65% in FICA, and earn less than the SS maximum would only need to pay an effective federal income tax rate of 6.25%. If you look at the following web page on table 8, you'll see that the average effective tax rate for those in the 25-50% income bracket was 5.56%. So somewhere between 25% and 50% average income the effective overall tax rate equals what Romney paid. This happens somewhere between $32K and $66K. If you really want to figure the total tax rate taking into account all taxes including state, local, sales, excise, energy, and other taxes the differences become even more dramatic.

http://www.taxfoundation.org/news/show/250.html#table8

[Ilsa]

2. Stop treating unearned income deferentially

From earned income.

Earned income should be treated at the same or better rate. People who live off the work of others should pay a higher tax rate.

[elehhhhna]

5. NO SHIT! That should be an OP.

[RWS]

4. Something to note

This only includes federal taxes and not the hoard of regressive taxes or fees that the government charges. All of which lie almost completely on the working and middle classes. Most of these would be considered double taxed, since it is an additional tax after your money has already been taxed so the effect rate on your pre taxed income is higher. 200 dollar DMV fee would really be more like 240 dollars if taken from your gross income.
Examples are:

Sales tax

Gas Tax

Sewer and Trash removal (crime not to pay where I am at, even if you did not use) Runs up to $200 a year

Airline Taxes (flat rate)

Passport Tax (flat Rate)

DMV Tax flat rate

Any sort of fines are almost all flat rate. Making minor law infractions extremely costly to regular folks while not even being noticed by the wealthy. IE speeding tickets

Entrance into state and national parks (in fact many of the wealthy do not pay this tax because they have golden age passports)

Alcohol Tax (Extremely regressive tax. Wine is taxed per gallon and not per value of wine. The current tax is around 1.07 federal and 20 cents extra for california a gallon if I remember correctly. This means a 5 dollar bottle of wine is taxed at 1.27/5 = .25 a bottle or 5% a bottle. Where as a a hundred dollar bottle is taxed a measly .25% wine tax.

Powerball tax, ie rich people dont play because they already have money

Extra school fees (sometimes they amount to close to 200 dollars of supplies per child)


I am not advocating that we remove all of these taxes/fees. Just saying that when these are included in ones overall payment to the government, then the % paid for the wealthy looks even lower in comparison.