Outrageous taxes...and for what?

brbr
Posted:
in General Discussion edited January 2014
On Monday in my HR Management class, we came across a small table in the textbook that showed the total effective tax rate on someone who makes $50,000 and lives in New York City. The total came out to be 43.3% and that doesn't include property or sales tax.



Effective Tax Rate

Federal: 28.0%

State: 4.9%

City: 2.7%

SS: 6.2%

Medicare: 1.5%

Total tax rate: 43.3%



In California this number is higher due to a much higher state tax rate. All this is without even thinking about saving money for retirement, of which experts now claim you should set aside 30% of your remaining paycheck so that you can live comfortably in retirement, paying for college, and paying for health insurance.



This is refvckingdiculous. 43.3% and we get outrageous college tuition, no healthcare, and no guarantee of ever seeing a dime of SS if you are under 40 now. We are paying socialist level taxes and seeing jack shit in return. This has got to stop. Our government is no longer working for us. It's time to take it back.
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Comments

  • Reply 1 of 39
    pfflampfflam Posts: 5,053member
    yeah!
  • Reply 2 of 39
    moogsmoogs Posts: 4,296member
    Quote:

    We are paying socialist level taxes and seeing jack shit in return. This has got to stop. Our government is no longer working for us. It's time to take it back.



    So true... and it carries over to healthcare as well. I cannot believe the amount of money I get gouged for each year (and it gets significantly worse each year), as a non-smoker with no major health problems, and my POS provider won't even cover things like annual checkups! Would it make sense to *reward* the people who demonstrably take care of themselves by co-paying the Annual checkups, vaccinations, etc? Obviously. Does BCBS do that (even with the high-end programs)? No. Of course not. Assholes.



    I am utterly disgusted by health insurance companies and the way they nickel and dime people to death (literally in many cases). Possibly the most uncaring, greedy group of "professionals" on the planet, and yet they need to be the most caring and least greedy (i.e. most principled). If ever there was an industry begging for federal regulation on behalf of consumers...



    ...like that will ever happen with the lobbyists they have. What's that saying about the love of money being the root of all evil? Health Insurance companies and Pharmaceutical companies are the living corporate embodiment of that saying. Even if you're not religious, it's still self-evident when something is so ethically backwards as to be "evil".
  • Reply 3 of 39
    Hell yeah.
  • Reply 4 of 39
    brbr Posts: 8,395member
    Speaking of healthcare...here's an interesting chart from the same textbook...don't have a scanner working so here is the country, life expectancy, infant mortality rate, and health expenditures as a % of GDP:



    Japan 81 3.9% 7.4%

    Korea 74 7.9% 6.0%

    Canada 79 5.1% 9.3%

    UK 78 5.6% 6.9%

    France 79 4.5% 9.6%

    Germany 77 4.8% 10.6%

    Mexico 72 26.2% 4.7%

    USA 77 6.8% 14.0%



    Anyone see a problem here?
  • Reply 5 of 39
    toweltowel Posts: 1,479member
    That's marginal tax rate, not effective tax rate. If a guy makes $50k in NYC, the next dollar he makes will be taxed at 43.3%, but his effective tax rate is much lower. I'd wager less than half that, but I'm too lazy to do the math. Remember that at the moment the federal gov't takes only about 17% of GDP, the lowest in a long, long time.



    You make a fantastic point about health care costs, though. Many chalk it up to the inefficiencies of a for-profit insurance industry. Others say that the overall inqeuality in our country makes it less healthy for everyone, no matter how much we spend. I like this view of the Medicare vs. for-profit debate:



  • Reply 6 of 39
    brbr Posts: 8,395member
    No, that's the effective tax rate. I didn't post the first column in the textbook's chart that listed the marginal rates.
  • Reply 7 of 39
    toweltowel Posts: 1,479member
    Quote:

    Originally posted by BR

    No, that's the effective tax rate. I didn't post the first column in the textbook's chart that listed the marginal rates.



    The federal tax rate is marginal. The 28% federal bracket last year started at $68k for a single taxpayer. But when the textbook was written, the current 25% was still at 28%, and that covered $28-68k. So 28% was his marginal rate (now it's 25%). According to this, his effective federal tax rate was probably closer to 10%.



    I don't know about the state or city rates, but I'd be suspicious. Especially since you can deduct what you pay in state (and city?) income tax from your federal taxable income.



    Really, no one, not even (especially?) the richest tycoon in America, pays 43% total income tax.
  • Reply 8 of 39
    scottscott Posts: 7,431member
    Quote:

    Originally posted by tonton

    Where does it go? Defense. Corporate bailouts. Hammers and toilet seats. Interest on the national debt. The Bush tax cut (yes our income taxes pay for investment tax cuts, you dolts).



    You forgot all the transfer payments and social program that account for most of it.
  • Reply 9 of 39
    bungebunge Posts: 7,329member
    Quote:

    Originally posted by Scott

    You forgot all the transfer payments and social program that account for most of it.



    Doesn't defense account for most of it?



    Most people get deductions up the wazoo. If you own a house, deduct the interest on your mortgage. If you have a kid, you've got another deduction.



    I'd rather see a system like this in place to help lower income taxes.



    Quote:

    HELSINKI (Reuters) - One of Finland's richest men has been fined a record 170,000 euros ($217,000) for speeding through the center of the capital, police said on Tuesday.



    Jussi Salonoja, 27, heir to his family's sausage business, was caught driving 50 miles per hour in a 25 mph zone last Thursday, the police said.



    Finnish traffic fines vary according to the offender's income and, according to tax office data, Salonoja's 2002 earnings were close to seven million euros.



  • Reply 10 of 39
    alcimedesalcimedes Posts: 5,486member
    hey BR, you have a citation for it? i have some folks who don't believe it.
  • Reply 11 of 39
    brbr Posts: 8,395member
    Quote:

    Originally posted by alcimedes

    hey BR, you have a citation for it? i have some folks who don't believe it.



    Human Resource Management by Noe Hollenbeck Gerhart and Wright published by McGraw Hill Irwin copyright 2003. The chart is found on page 530.



    Category Nominal Effective

    Fedreal 28 28

    State (NY) 6.8 4.9

    City (NY) 3.7 2.7

    SS 6.2 6.2

    Medicare 1.5 1.5



    Total Effective Tax rate on someone making 50k...43.3%



    The life expectancy is on page 545 and is separately sourced as:

    Org for Economic Cooperation and Development, OCED Health Data 99 (Paris:1999); U.S. Census Bureau, International Database, www.census.gov
  • Reply 12 of 39
    shetlineshetline Posts: 4,695member
    Quote:

    Originally posted by BR

    ...tax rate on someone who makes $50,000...



    Effective Tax Rate

    Federal: 28.0%




    That's got to be wrong.



    I just did my 2003 taxes, filing singly. I made over $50K after deductions and exemptions. The total federal tax I paid was only 20.3% of my taxable income, 16.5% of my adjusted gross income, and 15.6% of my unadjusted gross income.



    Someone whose unadjusted gross income is $50K has got to be paying much less than 28% in federal tax -- or making an enormous mistake on their tax returns. I'd guess the correct rate is likely to be under 15%.
  • Reply 13 of 39
    We keep demanding more services and the government is compelled to provide. The services we are provided (for the most part) are part of the privelege of living in the US. Unfortunately more and more people think that those priveleges are rights. There is no place in the US Constitution that guarantees public education or health-care, yet everyone thinks that the government (Federal, state, and/or local) must provide them.



    We've brought this upon ourselves because we (as a collective whole) demand too much from our government.



    I think we demand it because we want government to be the great equalizer so that rich and poor have equal access to everything. I think that as more people become affluent and can afford better eduction, health care, etc., that the less affluent demand the same. It's a vicious circle.



    How are taxes to ever go down and stay down when everyone demands so much from the government?
  • Reply 14 of 39
    shetlineshetline Posts: 4,695member
    Quote:

    Originally posted by Towel

    Really, no one, not even (especially?) the richest tycoon in America, pays 43% total income tax.



    If you want to call everything that gets taken out of your gross pay before you get your take-home pay "tax", my marginal rate is almost that high.



    I just got a "raise", if you can call it that. My company, which is one of the many struggling companies in the telcom industry, had given all employees a 10% pay cut, which has now been reduced to "only" 5%. (Maybe I should think of that as the Bush Recession Tax. ) When I compared my new paychecks to my old ones, I found that I was only taking home 58% of my pay increase -- 42% was taken out.



    Admittedly, part of what's being taken out is a self-imposed retirement tax: my 401K contributions. My health insurance is mostly all company paid, so that doesn't take too much out. However, federal income tax, social security, medicare, and unemployment taxes do add up to a fairly healthy bite out of any marginal pay increase I might receive, even if not as high as 43%. I'm sure happy I'm not paying nearly 6% Massachusetts income tax like I used to.
  • Reply 15 of 39
    sdw2001sdw2001 Posts: 16,931member
    Quote:

    Originally posted by shetline

    That's got to be wrong.



    I just did my 2003 taxes, filing singly. I made over $50K after deductions and exemptions. The total federal tax I paid was only 20.3% of my taxable income, 16.5% of my adjusted gross income, and 15.6% on my unadjusted gross income.



    Someone whose unadjusted gross income is $50K has got to be paying much less than 28% in federal tax -- or making an enormous mistake on their tax returns. I'd guess the correct rate is likely to be under 15%.




    You're right. But BR's figure is pretty close when ALL taxes, fees and licensures are added. The total can go over 50 when considering every single tax we pay.
  • Reply 16 of 39
    moogsmoogs Posts: 4,296member
    Right. Don't forget the monies the government took before you ever sat down in front of your return and W-2.



    As far as the government having to pay for more and more services, I don't think people believe the government ought to provide health care so much as a matter of principle, but because the private sector has done such an awful job of it themselves. They've proven themselves incompetant basically. The alternative is either do nothing and let them rake us over the coals till we die, or push the government to regulate certain aspects of their business in order to pass a more reasonable fee along to the consumer each year.



    Although of course, the drug companies will tell you FDA regulation is the reason they charge out the wazoo for new prescription drugs -- to reoup all the "R&D" costs basically. However one wonders if the government could say "you're only allowed to pass so much of that expense on to consumers. The rest you have to deal with, either by finding ways to reduce the cost of manufacturing and distribution (and marketing! tv ads are expensive), or by selling to a wider range of countries or whatever.
  • Reply 17 of 39
    brussellbrussell Posts: 9,812member
    Quote:

    Originally posted by BR

    On Monday in my HR Management class, we came across a small table in the textbook that showed the total effective tax rate on someone who makes $50,000 and lives in New York City. The total came out to be 43.3% and that doesn't include property or sales tax.



    Effective Tax Rate

    Federal: 28.0%

    State: 4.9%

    City: 2.7%

    SS: 6.2%

    Medicare: 1.5%

    Total tax rate: 43.3%



    In California this number is higher due to a much higher state tax rate. All this is without even thinking about saving money for retirement, of which experts now claim you should set aside 30% of your remaining paycheck so that you can live comfortably in retirement, paying for college, and paying for health insurance.



    This is refvckingdiculous. 43.3% and we get outrageous college tuition, no healthcare, and no guarantee of ever seeing a dime of SS if you are under 40 now. We are paying socialist level taxes and seeing jack shit in return. This has got to stop. Our government is no longer working for us. It's time to take it back.








    Towel is right, your book is wrong.



    The total effective federal tax rate (including social security and medicare) is about 15% for someone making $50,000.



    Someone who's making $50,000 is in the middle quintile.







    For Federal income taxes in 2000, the effective federal income tax rate was 5% for someone in that middle quintile. Social Security and Medicare together are 10%. And that's before Bush's tax cuts.



    http://www.taxpolicycenter.org/TaxFa...storical_2.gif



    We're at the lowest rate of taxation that we've had since just after WWII. That's before the expansion of gov't programs under LBJ. Yet those programs are still here, and much much bigger. We're taxed way too little for what we get. Hence the deficits.
  • Reply 18 of 39
    And yet, you've got George W. Jackass dropping bags of cash on the National Endowment for the Arts (since when do we need tax-funded art) and orchestrating his fascist based initiatives and such. wtf is wrong with this picture... /rant
  • Reply 19 of 39
    pfflampfflam Posts: 5,053member
    Take my taxes!!



    take your taxes and we're even



    and if it is used semi-wisely then that is a good thing.



    by the way: false-premise warfare is not a good thing
  • Reply 20 of 39
    moogsmoogs Posts: 4,296member
    You can say what you want about historical trends and the like, but when you figure in the costs of social security, state taxes, sales tax, health insurance premiums (even though not from the government), and all the rest... we don't get what we pay for by a long shot. And I think that's what BR is saying basically, whether his text book is using the correct terminology or not.
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