Who Really Pays Taxes

It doesn't really matter which side of the political fight that you're on, the taxes (all taxes) flow down to the little guy. No one can deny that wealthy people pay taxes. The IRS numbers show it. There are many reports that show that the greatest burden of income taxes (not payroll) are borne by the smallest minority of the wealthiest individuals. So you might say, "Yeah! stick it to the evil rich guy!" I'm here to tell you, "WRONG." No matter how you break down the numbers, the only guy who pays all the taxes is the guy who works for a wage and consumes a product or service.

The rich get rich by the manner with which they live and the financial decisions that they make. The rich also have the means to find deductions and shelters. I know that they pay taxes but if they paid so many taxes as a percentage of their income, how are they still wealthy? The rich always bring in more revenue (note I didn't say income) than they expend. More in, less out. How do they do that? There are many ways to invest money tax free. When the tax burden is too much, the rich stop (or slow down) "earning" money. The rich also reduce expenses to live under the investments and other non-taxable revenues reducing the need to "earn" money. This also happens in economic recessions. The key is that although the numbers show that the rich pay taxes, they also have more control over what their respective tax burden will be.

Many say, tax the big companies. Again, I tell you, "WRONG." No company pays taxes. No company will pay for the carbon offsets under a "Cap-n-Trade" program. Companies figure out what their operating expenses are (overhead). Businesses then calculate based on market factors what's the maximum that they can charge for a product and still maximize sales. The maximum amount that can be charged must cover the operating expenses and provide for profit or they go out of business. What does this mean? You pay the tax when you purchase the product or service.

The rich man is also the business owner. Don't you think that he understands what his personal tax burdens are therefore understands how much profit that business must make? He must charge more, produce more, or cut expenses when the tax burden goes up. Rest assured that he will do this.

Recent reports are showing that 47% of Americans' tax bill will be zero. That may be exactly what the 1040 form shows in the end but this is where the system is deceptive. The average "Joe" wage earner pays all of the taxes no matter how you slice it. When "Joe" works for a living, he only makes "earned income" which is taxed. When "Joe" spends his money he pays sales tax. When "Joe" consumes a product he pays all the evil businesses' taxes and the business owners' taxes.

The main point here is that it doesn't matter if you're a "progressive" who believes that the wealthy and the businesses should pay all the taxes or if you're a "conservative" who thinks that businesses should get a tax break. All taxes trickle down to those who earn income and who consume products and services. Taxing the wealthy and business only serve to hurt the economy by slowing the flow of revenue within the economy. Taxing the wealthy and business only causes them to retract which negatively affects employment.

There is no "fair" tax, there is only tax. When the government is too big and attempts to do the things that it was not intended to do, all elements of the economy suffer. The government does not adequately care for the elderly, the sick, or the poor. The government's feeble attempt only hurts the economy thereby increasing the need for more government services and more taxes. This is the vicious cycle that must be stopped and reversed immediately.

Take the housing boom for instance. The "Government" mandated that lenders lend to people who could not afford to pay. The "Government" did not regulate the way that the financial industry packaged bad loans to hide them from the investment community. Although this is a long debatable story, the fact remains that the government failed. The government over stepped its boundaries with regard to social engineering and under stepped with regard to regulating commerce. You see government messed around where it should stay out of and failed to get involved where it actually has authority.

So what's the solution? Simple, reduce the size of government and the role of government. We do not need the government to care for us, the government can't even care for itself. The government deals in disparity, not in prosperity. Stop looking to the government for prosperity, you will not find it. The best and quickest way to have more money is to stop spending it on the government. This is accomplished via your vote.