The Daily Caller

The Daily Caller

Does Obama want to push US tax policy to the left of Sweden?

Neil Munro
White House Correspondent

President Barack Obama wants well-off Americans to pay more taxes, but wealthy Americans already pay a higher proportion of income taxes than top-earners in Sweden, Finland, Holland and other welfare-state nations.

The top 10 percent of income-earners in the U.S. and Sweden earned one quarter of national income, yet rich Americans paid 45 percent of all income taxes, while rich Swedes paid only 26.6 percent of taxes. In Finland and Holland, the wealthy paid 32 percent and 35 percent of taxes, according to a study of tax-data collected by the Organization for Economic Cooperation and Development. a Paris-based organization of 34 governments.

The comparison was prepared by Scott Hodge, president of the D.C. based Tax Foundation.

Liberal groups counter with studies that account for federal income and payroll taxes, as well as state and local property and sales taxes. But even those studies show an enormous skew. In 2009, according to an April study by Citizens for Tax Justice, the top 10 percent of earners paid 40 percent of all taxes after earning 35 percent of all income. The lowest 60 percent of earners paid 17 percent of all taxes, after earning 22 percent of all income.

The effective tax rates on the lowest 60 percent was roughly 20 percent, while the tax-rate on the wealthiest 10 percent was roughly 31 percent, according to charts included in an April statement by the group’. “The U.S. tax system just barely qualifies as progressive,” said the statement.

Historical data from the left-of-center Tax Policy Center shows that the wealthy are providing an increasing share of income taxes. In 1979, the top 10 percent of households paid 40.7 percent of federal income-taxes. By 2007, after President George W. Bush’s tax cuts had taken effect, the top 10 percent paid 55 percent of taxes. The lowest 60 percent saw their share drop from 22.5 percent to 13.4 percent, partly because the Bush tax-cuts eliminated taxes for many low-earners, and boosted the “progressiveness” of the tax code.

One painful side-effect of the federal government’s reliance on income-taxes paid by the wealthy is that the 2008 recession had a disproportionate impact on federal tax-income, which has dropped from roughly 18 percent of the economy to 15 percent since 2008. “Higher-income people tend to have more volatile incomes that middle-income people,” partly because they earn more from from stocks sales and dividends, Mark Robyn, staff economist at the Tax Policy Foundation. When the economy shrinks, so does the stock market, and so does federal income, he said. Tax ”revenues increase faster when the economy is growing quickly, and tend to shrink faster” when the economy turns down, he said.

  • Landrew

    The leftist group claiming the effective tax rate on the lowest 60% is 20% is including the employer FICA match as paid by the employee, basically pretending that if it were not being paid, it would result in higher wages, so is, in effect, being paid by the employee. This is their favorite talking point, which they’ll claim “pretty much every economist” agrees with. It’s nonsense.

    The fact is a family of 4 making 50k a year pays no income tax, only the 7.65 (5.65 last year) FICA. As you get lower than that, you are often bringing in money thru the EIC and others, which offsets the FICA you are paying. The bottom half are paying next to nothing, nothing at all, or raking in money thru the income tax system. Anyone can do a tax return on an imaginey person in that group and see that.

    State income tax? If you are in the bracket where you are paying little fed income tax, you’re also paying little to no state tax. And of course, some states have none.

    Sales Tax? This is absurd. In VA it’s, what 5%, 1% for food, something like that. The only way that adds up to a meaningful number is if you are buying lots of goods, in which case, you can’t really claim to be “hurting”, can you?
    Buy that big flat screen TV for $500 and its $25 sales tax. So yo can afford $500, but the $25 kills you? Buy $100 in groceries, and the %1.50 in tax breaks the bank? Who are they trying to kid?

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  • kingfish

    WHAT THE PENTAGON IS DOING WITH THEIR DOUBLED BUDGET SINCE 2001, BESIDES TWO DECADE-LONG WARS THEY CAN’T OR WON’T WIN
    ————————–

    Pastor Lindsey Williams’ latest video says his source revealed the following nations will be targeted by the NWO (using CIA-instigated riots) in this order: Yemen, Syria, Bahrain, and Saudi Arabia, pushing crude oil to $200 a barrel or above.

    Pastor Williams’ source said, “when the Fed begins to buy its own debt, the end of the dollar is near”. This has been happening for months, so the NWO’s game is now on, the target is the Middle East to prevent oil from reaching the U.S. Lack of oil will collapse the dollar and the entire U.S. economy. Then the NWO’s final grand move is to GRAB CONTROL of the U.S. once and for all via 1) martial law 2) control of the food supply 3) control of money 4) control of transportation and individual movement – your TSA peodophiles 5) control of health care 6) chipping the population 7) forced toxic vaccines weakening immune systems.

    There’s only one option left for Americans, which is EXPOSE them immediately before it’s too late. That’s the only thing we have left, EXPOSURE. They must be dragged out into public and shown for what they truly are before our Dollar crashes, the Middle East falls to the Muslim Brotherhood, and the NWO establishes its global reserve currency. The NWO globalists include David & Jay Rockefeller, Soros, Rothschilds, Kissinger, Bush/Clinton cabal and puppet Obama, the 13 families owning the FEDERAL RESERVE, big banks. Global corporations, neocon PNAC criminals.
    http://www.abovetopsecret.com/forum/thread688916/pg1

  • curmudgeon

    Hey, give Obama a break.

    If he has to look at the whole picture, there goes his rationale for demagoguery.

    You wouldn’t want him to be having to deal with the facts, now, would you?

  • 1TrueOne55

    Also the rich can change Zip codes easier than any other class also Switzerland looks good all year long. Especially Davos.

  • virginiagentleman

    Gee, what an honor! We are compared to ‘other’ welfare-state nations.

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  • jmk1502

    How much of the “rich’s” income come from payroll taxes, and how much comes from stocks, dividends, etc.? I’m sure the top 10% work 9-5 jobs. You’re delusions are showing..

    • Dee2008

      You missed the point. It’s BECAUSE their income doesn’t come from payroll that we shouldn’t depend so heavily on them for revenue. When the market drops, as it did in 2008, capital gains and dividends track right along with it. Income from payroll is more stable.

      I know you don’t like to see these nails getting pounded in to the coffin of Obama’s ideas, but truth is hard sometimes.