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• We’re broke.
• We’re drowning in debt.
• We’re being taxed to death.
• We need to rein in government spending to get our economy back on solid footing.
• We’re not broke.
• The problem isn’t out-of-control spending. It’s an unfair tax system.
• Instead of spending cuts that hurt retirees, working families and the poor, we should demand that corporations and the wealthy pay their fair share.
In the 1950s, corporate taxes accounted for 27 percent of U.S. revenue. By 2010, that percentage decreased to less than 10 percent.
Corporate tax dodgers are leaving the U.S. coffers short. If you paid a penny in federal income tax last year, then you paid more than General Electric, Bank of America, Verizon, Boeing, Citigroup and Whirlpool combined.
And it gets even more outrageous. Whirlpool’s income tax rate in recent years has ranged from negative 81.7 percent to negative 10.9 percent. That’s not how much they paid; it’s how much they got back in tax benefits.
It’s clear that corporate America is avoiding taxes on a massive scale. Corporate income taxes have been shrinking as a share of both federal income and the overall economy. If restored to historical levels, the U.S. Treasury would see an infusion of hundreds of billions of dollars.
Among individual taxpayers, the richest of the rich also get special breaks.
The 400 richest Americans (with an average annual income of $345 million) pay 16.6 percent in federal income taxes, while those in the top 1 percent who make “only” $380,000 or more pay 23.3 percent.
Why the imbalance? The main reason is preferential treatment of income from capital gains.
Capital gains (including the so-called “carried interest” that hedge fund managers rake in) are where the wealthiest taxpayers get most of their income. The special treatment of capital gains means that the rich get a huge tax break. It also means that a lot of money that the federal government used to get when the tax system was fairer is no longer going toward maintaining and building bridges, roads and highways; education; cleaning our air and water and all the other public systems on which all Americans rely.
General Electric: paid no U.S. income tax in 2010
Boeing: paid no U.S. income tax in 2010
Bank of America: paid no U.S. income tax in 2010
Whirlpool: income tax rate in recent years has ranged from (81.7)% to (10.9)% - that’s how much the company received back in credits and incentives as a percentage of its profits!
* Very partial list
Corporations don’t dodge taxes. The people who run corporations do. And these people – America’s CEOs – are reaping awesomely lavish rewards for tax dodging their corporations do.
In fact, corporate tax dodging has gone so out of control that 25 major U.S. corporations last year paid their chief executives more than they paid Uncle Sam in federal income taxes.
This year’s Institute for Policy Studies (IPS) Executive Excess report, their 18th annual, explores the intersection between CEO pay and aggressive corporate tax dodging.
To review the report and take action, visit their website at ips-dc.org.
Source: Institute for Policy Studies
Every day is a tax holiday for the rich in the United States, while the vast majority of Americans pay the price in starved public services.
If even one change was made to the current tax system – taxing the capital gains of the country’s 400 wealthiest people at the top individual rate of 35 percent instead of the current special rate of 15 percent – the federal government would receive an additional $18 billion.
Or, if the top 1 percent of the wealthiest individuals paid the same income tax they paid in 1996, when the U.S. economy was stronger than it is now, they would still be rich and the federal government would have an additional $94 billion.
The rich didn’t always pay such low rates of taxes, but they’ve always been rich regardless of what they pay. The rich pay lower effective income tax rates than they used to because the Bush tax cuts went disproportionately to the wealthy.
On the individual side, the tax code
is still progressive (kind of) ...
... except at the very top!
Federal income tax rates for the wealthiest individuals in the United States