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It works if you ignore FICA completely (which is weird because it's like 30-40% of tax collected or something), and round 45% up to 50%. If you include FICA, i

by dmoy 2y ago

It works if you ignore FICA completely (which is weird because it's like 30-40% of tax collected or something), and round 45% up to 50%. If you include FICA, it's more like the top 1% of income people pay ~30% of total tax (somewhere around there).

mandmandam 2y ago
The top 1% also 'earn' >20% of all income, and hold over 30% of all wealth. The bottom 50% of Americans own less than 3% of all wealth. I really think that these figures need to start taking into account disposable income, so we can see just how fucking evil this situation really is. There's over 8 million hungry kids in the wealthiest country on the planet. Half a million families file for bankruptcy every year due to medical debt. Etc. And people are arguing in all seriousness that we need to tax corporations and the wealthy even less, quoting Thatcher and cherry-picking misleading stats. Ugh.
AnimalMuppet 2y ago
FICA is capped. Past about $160k, you pay no additional Social Security; past about $180k you pay no additional Medicare tax. So if you earn $1 million a year, you pay a lower percentage of your income in FICA than if you earn $100k. So if I understood you correctly, yes, the rich pay a higher percentage of taxes if you ignore FICA, because the poor and middle class pay a much higher percentage of FICA.
- dmoy 2y ago
  Pretty much, yea. Pedantically, only the social security part of FICA is capped. Medicare you still pay 1.45-2.35%, uncapped. But the 6.2% for social security is capped, and thus for the top end of the 1% ends up being a miniscule tax. If you get rid of the social security cap, get rid of mortgage interest deduction, and add a wealth tax, that more or less solves the 2034 debt to <100% of GDP right there.
  - AnimalMuppet 2y ago
    Huh. I thought that Medicare had a cap, too, just a higher one. Also note that FICA is only on "earned income" (not interest, dividends, capital gains, rental income...), and is not subject to the standard deductions.
naveen99 2y ago
Also, 25% of federal expenditures are funded by printing money, which is just a tax more like fica than income tax. Of course the other way of looking at it is that fica ultimately just comes out of the pocket of the rich. If there were no payroll taxes, fica would just stay in the employers pockets. Employers are mostly the rich. Or may be it would get embezzled by the middle management due to increased principal agent problem without the payroll tax paper trail…

by dmoy 2y ago

mandmandam 2y ago

The top 1% also 'earn' >20% of all income, and hold over 30% of all wealth. The bottom 50% of Americans own less than 3% of all wealth. I really think that these figures need to start taking into account disposable income, so we can see just how fucking evil this situation really is. There's over 8 million hungry kids in the wealthiest country on the planet. Half a million families file for bankruptcy every year due to medical debt. Etc. And people are arguing in all seriousness that we need to tax corporations and the wealthy even less, quoting Thatcher and cherry-picking misleading stats. Ugh.

AnimalMuppet 2y ago

FICA is capped. Past about $160k, you pay no additional Social Security; past about $180k you pay no additional Medicare tax. So if you earn $1 million a year, you pay a lower percentage of your income in FICA than if you earn $100k. So if I understood you correctly, yes, the rich pay a higher percentage of taxes if you ignore FICA, because the poor and middle class pay a much higher percentage of FICA.

dmoy 2y ago
Pretty much, yea. Pedantically, only the social security part of FICA is capped. Medicare you still pay 1.45-2.35%, uncapped. But the 6.2% for social security is capped, and thus for the top end of the 1% ends up being a miniscule tax. If you get rid of the social security cap, get rid of mortgage interest deduction, and add a wealth tax, that more or less solves the 2034 debt to <100% of GDP right there.
- AnimalMuppet 2y ago
  Huh. I thought that Medicare had a cap, too, just a higher one. Also note that FICA is only on "earned income" (not interest, dividends, capital gains, rental income...), and is not subject to the standard deductions.

naveen99 2y ago

Also, 25% of federal expenditures are funded by printing money, which is just a tax more like fica than income tax. Of course the other way of looking at it is that fica ultimately just comes out of the pocket of the rich. If there were no payroll taxes, fica would just stay in the employers pockets. Employers are mostly the rich. Or may be it would get embezzled by the middle management due to increased principal agent problem without the payroll tax paper trail…