LETTERLearn more about taxesIf you traveled on Highway 13 through Phillips in northern Wisconsin in early April, did you see the sign by a church that read “IRS HYMN – ALL TO THEE”?
If you traveled on Highway 13 through Phillips in northern Wisconsin in early April, did you see the sign by a church that read “IRS HYMN – ALL TO THEE”? Did you chuckle when you saw it? Then did your amusement shift to disgruntlement as you said to yourself: “You bet my taxes are too high.”
On TV and radio shows have you heard the message “Our Taxes Are Too High!” repeated incessantly by hosts and pundits who insist lower taxes for everyone will speed economic growth, lower unemployment, and fix our economic woes?
Citizens for Tax Justice provides facts, reports and charts with easy-to-understand explanations about taxes. In “Six Things You Need to Know on Tax Day,” the organization sets the record straight on several common misconceptions.
Virtually all Americans, including the poorest, pay taxes. When someone says almost half of Americans are not paying taxes that refers to just one tax, federal personal income tax. State and local taxes take a larger share of income from a poor family than they take from a higher-income family.
America is not overtaxed. Of the world’s developed countries, only two — Chile and Mexico — collect less tax revenue as a share of their economy than does the U.S.
Wealthy Americans are not overtaxed. When you add up all the federal, state and local taxes that Americans pay, our overall tax system is just barely progressive. The richest 1 percent of Americans pays 24 percent of the total taxes in America, but they also take in 21.9 percent of the total income in America.
U.S. corporations are under-taxed. Citizens for Tax Justice study of 280 profitable Fortune 500 corporations found that they on average paid about half the official corporate tax rate of 35 percent from 2008 to 2010. Many large profitable companies, including Facebook, Pepco and Southwest Airlines, paid no corporate income taxes in 2012.
Tax cuts for the rich do not help our economy. Using data from the past 65 years, the Congressional Research Service found no correlation between top tax rates and economic growth. Research shows lowering or eliminating state income taxes has little if any impact on state economies.
Your tax bracket is not your effective tax rate. If your income grows and you find yourself in a higher tax bracket, your tax rate only goes up on the portion of your income above the threshold.
Check out Citizens for Tax Justice (ctj.org) for fact-based perspectives on taxation that you don’t often hear on mainstream corporate media.