What should the progressive tax rate be?

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So, we hear a lot from the left that rich people don't pay enough taxes. And we hear a lot from the right that they pay too much. I'm curious what you think the tax rate SHOULD be by income bracket. Please feel free to add/as many brackets as you like. I've also taken the liberty to round the brackets to make it a little easier to have a discussion.

These are 2010 tax brackets, rounded to to keep it simple.

Tax Rate-----Married Couples Filing Jointly-----Most Single Filers
10%-------------Not over $20,000------------------Not over $10,000
15%-------------$20,000 to $70,000----------------$10,000 to $35,000
25%-------------$70,000 to $140,000---------------$35,000 to $80,000
28%-------------$140,000 to $210,000--------------$80,000 to $170,000
33%-------------$210,000 to $375,000--------------$170,000 to $375,000
35%-------------Over $375,000----------------------Over $375,000

I'd just like to know what people think an appropriate tax bracket should be.

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Type: Discussion • Score: 9 • Views: 10,308 • Replies: 90

[+3] - Robert Gentel - 04/25/2011Every time someone disagrees with your tax-happy politics do you call them greedy? Can you even imagine someone being able to disagree with you simply by drawing different conclusions about what...

@maporsche,

maporsche wrote:

Tax Rate-----Married Couples Filing Jointly-----Most Single Filers
5%-----Absolute minimum that people can pay up to $10,000 / $5,000 (no deductions below this amount)
10%-------------$10,000 to $20,000----------------$5,000 to $10,000
15%-------------$20,000 to $70,000----------------$10,000 to $35,000
20%-------------$70,000 to $140,000---------------$35,000 to $80,000
25%-------------$140,000 to $210,000--------------$80,000 to $170,000
30%-------------$210,000 to $375,000--------------$170,000 to $375,000
35% -------------$375,000 to $500,000-------------$375,000 to $500,000
40% -------------$500,000 to $750,000--------------$500,000 to $750,000
50% -------------$750,000 to $3,000,000------------$750,000 to $3,000,000
60% -------------$3,000,000 to $10,000,000--------$3,000,000 to $10,000,000
70%-------------- >$10,000,000------------------ >$10,000,000

I may be able to support a range like this. I'd like to see some numbers, but I have little problem taxing income in the millions pretty significantly. Those people benefit by far from the policies of the USA.

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@maporsche,

Here's how my income bracket would break down if someone's income was at the upper end of each bracket.

Rate--Income---------Taxes------------Total Taxes---Total Tax Rate
5%----$10,000---------$500-------------$500------------5%
10%---$20,000---------$1,000----------$1,500----------8%
15%---$70,000---------$7,500----------$9,000----------13%
20%---$140,000--------$14,000---------$23,000--------16%
25%---$210,000--------$17,500---------$40,500--------19%
30%---$375,000--------$49,500---------$90,000--------24%
35%---$500,000--------$43,750---------$133,750-------27%
40%---$750,000--------$100,000--------$233,750------31%
50%---$3,000,000------$1,125,000-----$1,358,750----45%
60%---$10,000,000-----$4,200,000-----$5,558,750----56%
70%---$40,000,000-----$21,000,000----$26,558,750---66%

4 Replies

@maporsche,

All of that is nullified by tax loop holes.

1 Reply

@talk72000,

It's not nullified, the values are based on taxable income. The loopholes are there, tthey just reduce your TI. So if I made 3 million this year, but had 1 million in loopholes, my TI would be 2 million and I'd pay taxes on that amount.

Care to talk about My values or your own?

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Taxes, are necessarily arbitrary. Our society (through our elected legislators) have accepted the idea that the wealthy should pay a higher percentage of their income then the poor, but the specifics necessarily change from year to year based on economic needs.

I don't think there is a "correct" answer.

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@maporsche,

Over ten millions how does 90 percent sound?

Oh for the good old and fast growing economic of the post war years.

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The higher your income is
the lower your rate shoud be because in absolute dollar amounts
u will be paying more as a result of a larger taxable income,
but u do not receive commensurately greater services; e.g.,
the National Weather Service or the Census Bureau will not serve u better.

Above $100,000: there shud be no taxation.

Ideally, there shud be no income taxation.
16th Amendment shud be repealed, in favor of sales taxation.
That way every citizen designates how much he will spend in taxes, by his purchases.
All government services shud be funded by sales taxes,
with everyone paying the same rate, or by importation tariffs,
but sales of guns or ammunition shud be IMMUNE from any taxation, as a constitutional right that cannot be infringed.

David

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@OmSigDAVID,

I don't believe I have heard that argument before. Is it original?

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@roger,

roger wrote:

I don't believe I have heard that argument before. Is it original?

I used 2 arguments, qua declining rates
and IMMUNITY from taxation of constitutional rights.

Which did u have in mind ?

David

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@maporsche,

I like your tax scale in general. I think your single vs married table will have some unusual consequences. You've created a big marriage penalty at the high end so that duel income rich people would be fools to marry.

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One thing I would love to see is a rule or law that no public traded company can pay it top men and women more then a hundred times what they pay their lowest pay employees.

No more setting up boards of directors who share each other memberships and vote each others very large and undeserve salaries.

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@OmSigDAVID,

I agree Dave, the weather service and census bereau will not serve you more.

However, all the wars we fight for cheap oil, or the stimulus packages we pass to keep the economy afloat, or the money we spend fighting terror to keep the stock market from crashing....these are things that benefit the rich FAR greater than they benefit the poor.

How many greeters at Walmart do you know who were affected by the housing and stock market crash? How many McDonalds employees were in the Twin Towers? How many terrorists are targeting the local trailer park?

The most expensive parts of our government payed for by income taxes benefit the rich far more than the poor.

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@maporsche,

Interesting game, Bo. It should continue to be fun.
I am, though, a bit confused about the ground rules. When you say "income" you are talking about "taxable income." Right? We are not going to get into the deductions that got folks down from "total income." Things like deductions for dependents, mortgage interest, charitable contributions etc. Good. And we are talking about a tax return per household without regard to whether it is from an individual or a couple? If so, good again.
We have to keep it simple to start this going.
I am not quite sure that I understand what your rows mean below. For example:

maporsche wrote:

Here's how my income bracket would break down if someone's income was at the upper end of each bracket.

Rate--Income---------Taxes------------Total Taxes---Total Tax Rate
35%---$500,000--------$43,750---------$133,750-------27%

Could you explain the math column headings? Thank you.

1 Reply

@OmSigDAVID,

OmSigDAVID wrote:

sales of guns or ammunition shud be IMMUNE from any taxation, as a constitutional right that cannot be infringed.
David

Why just guns and ammo? How about knives, clubs, chainsaws and frying pans. All of which make pretty convenient defensive weapons.
I should be able deduct my gym fee. Roger has met me. He knows that my bare arms are as thick as a bear's. I have a constitutional right to maintain that cannot be infringed.

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@realjohnboy,

Yep. Stands 6'20", arms like a bear, and has to turn sideways to get his shoulders through a standard doorway.

For what it's worth, most gun owners and fishermen support the excise tax on guns, ammunition, and fishing tackle. It was more than odd that TARP I deleted the tax on cedar arrows. Congress can be interesting, at times.

1 Reply

@roger,

roger wrote:

Yep. Stands 6'20", arms like a bear, and has to turn sideways to get his shoulders through a standard doorway.

For what it's worth, most gun owners and fishermen support the excise tax on guns, ammunition, and fishing tackle.
It was more than odd that TARP I deleted the tax on cedar arrows. Congress can be interesting, at times.

There were (at least) 2 cases in the 1930s or 1940s of salesmen of religious reading materials
being taxed license fees and/or sales taxes by 2 States.

In each case, the USSC ruled that no constitutional right can be taxed.

David

0 Replies

@realjohnboy,

realjohnboy wrote:

When you say "income" you are talking about "taxable income." Right? ---- Yes
And we are talking about a tax return per household without regard to whether it is from an individual or a couple? ---- Yes and No. This particular example looks at an individual, and ot keep it simple it may be a good idea to do that.

maporsche wrote:

Here's how my income bracket would break down if someone's income was at the upper end of each bracket.

Rate--Income---------Taxes------------Total Taxes---Total Tax Rate
35%---$500,000--------$43,750---------$133,750-------27%

Could you explain the math column headings? Thank you.
Sure, the previous post of mine shows a proposal for what I think the tax brackets could look like, and the corresponding tax rate for that bracket.
The rate is the tax rate for that particular bracket.
The Income is a hypothetical income for a person for simplicity I just chose the highest income for each bracket from my previous post.
The 'Taxes' column is the amount that the person pays in that particular bracket. For this example, the person makes $500,000 and pays 35% on the entire bracket range ($375k-$500k). This is the amount of taxes paid at the 35% rate.
The 'Total Taxes' column is the sum of the taxes at each of the ranges. For this person making $500k, they paid $500 at the 5% bracket, $1000 at the 10% bracket, $7500 at the 15% bracket, $14000 at the 20% bracket, $17500 at the 25% bracket, $49500 at the 30% bracket, and now $43750 at the 35% bracket. That all adds up to $133,750.
The 'Total Tax Rate' is the Total Taxes column divided by the Income column.

0 Replies

@maporsche,

maporsche wrote:

Here's how my income bracket would break down if someone's income was at the upper end of each bracket.

Rate--Income---------Taxes------------Total Taxes---Total Tax Rate
5%----$10,000---------$500-------------$500------------5%
10%---$20,000---------$1,000----------$1,500----------8%
15%---$70,000---------$7,500----------$9,000----------13%
20%---$140,000--------$14,000---------$23,000--------16%
25%---$210,000--------$17,500---------$40,500--------19%
30%---$375,000--------$49,500---------$90,000--------24%
35%---$500,000--------$43,750---------$133,750-------27%
40%---$750,000--------$100,000--------$233,750------31%
50%---$3,000,000------$1,125,000-----$1,358,750----45%
60%---$10,000,000-----$4,200,000-----$5,558,750----56%
70%---$40,000,000-----$21,000,000----$26,558,750---66%

1 Reply

@realjohnboy,

realjohnboy wrote:

maporsche wrote:

Here's how my income bracket would break down if someone's income was at the upper end of each bracket.

Rate--Income---------Taxes------------Total Taxes---Total Tax Rate
5%----$10,000---------$500-------------$500------------5%
10%---$20,000---------$1,000----------$1,500----------8%
15%---$70,000---------$7,500----------$9,000----------13%
20%---$140,000--------$14,000---------$23,000--------16%
25%---$210,000--------$17,500---------$40,500--------19%
30%---$375,000--------$49,500---------$90,000--------24%
35%---$500,000--------$43,750---------$133,750-------27%
40%---$750,000--------$100,000--------$233,750------31%
50%---$3,000,000------$1,125,000-----$1,358,750----45%
60%---$10,000,000-----$4,200,000-----$5,558,750----56%
70%---$40,000,000-----$21,000,000----$26,558,750---66%

That 's ridiculous!!! Y shoud anyone donate 70% of his income to the damned government ???

David

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