Billionaires And Corporations Are Lightly Taxed
Tax day is a happy day if you’re a billionaire or a corporate CEO. The GOP’s dirty little secret is that the top 1% and corporations are lightly taxed.
A 2021 report from White House economists estimated that the wealthiest 400 billionaire families in America paid an average of just 8.2 percent of their income — including income from their wealth that goes largely untaxed — in Federal individual income taxes between 2010 and 2018. That’s a lower rate than many ordinary Americans pay.
According to the GAO, the average effective tax rates — the percentage of income paid after tax breaks — among profitable large corporations fell from 16% in 2014 to 9% in 2018.
A study from the University of California-Berkely concluded that in 2018, the average effective tax rate paid by the richest 400 families in the country was 23 percent, a full percentage point lower than the 24.2 percent rate paid by the bottom half of American households.
In 1980, by contrast, the 400 richest had an effective tax rate of 47 percent. In 1960, that rate was as high as 56 percent. The effective tax rate paid by the bottom 50 percent, by contrast, has changed little over time.
Billionaires and corporations pay less than we do because they don’t pay income taxes. Instead, they pay capital gains, dividend and corporate taxes — which are all taxed at a lower rate than ordinary income. In addition, the super wealthy have access to deductions and exemptions that aren’t available to the middle class. That’s why they pay less.
In the absence of the failed Bush 43 and Trump tax cuts, we would have a balanced budget according to a recent report from the Center for American Progress.
That same report from the Center for American Progress indicated that the U.S. is a low tax country. Compared with other nations in the Organization for Economic Cooperation and Development (OECD), the United States ranks 32nd out of 38 in revenue as a percentage of GDP.
The Republicans believe that rich people don’t have enough money and that the poor and middle class have it too easy. The GOP wants to cut programs for the poor and middle class to maintain low tax rates on the wealthy and corporations.
The Democrats support most Americans and the GOP supports the wealthy. That is the choice in 2024. Choose wisely.