David Cay Johnston on June 5, 2012 writes on Reuthres.com:
“Six American families paid no federal income taxes in 2009 while making something on the order of $200 million each. This is one of many stunning revelations in new IRS data that deserves a thorough airing in this year’s election campaign.
“The data, posted on the IRS website last week, brings into sharp focus the debate over whether the rich need more tax cuts (Mitt Romney and congressional Republicans) or should pay higher rates (President Obama and most Democrats).
“The annual report (link.reuters.com/vec68s), which the IRS typically releases with a two-year delay, covers the 400 tax returns reporting the highest incomes in 2009. These families reported an average income of $202.4 million, down for the second year as the Great Recession slashed their capital gains.
“In addition to the six who paid no tax, another 110 families paid 15 percent or less in federal income taxes. That’s the same federal tax rate as a single worker who made $61,500 in 2009.
“Overall, the top 400 paid an average income tax rate of 19.9 percent, the same rate paid by a single worker who made $110,000 in 2009. The top 400 earned five times that much every day.
“Just 82 of the top 400 were taxed in accord with the Buffett rule, which proposes a minimum tax of 30 percent on annual incomes greater than $1 million.”
David Cay Johnson does an excellent job exposing the inequity and injustice of our tax system, by which working people are forced to pay federal taxes annually while the rich are allowed to defer their taxes or live tax-free, yet use the full value of their earnings to borrow against to accumulate increasingly more productive capital assets in business corporations and companies. Most people think that as you go up the earnings ladder you pay more taxes, but this is not the case, not to mention the resulting effect that systematically concentrates future productive capital wealth among a tiny minority of rich people.
While tax and investment stimulus incentives are supposed to be tools to strengthen economic growth, without the requirement that productive capital ownership is broadened simultaneously, the result will continue to further concentrate productive capital ownership among those who already own, and further create dependency on redistribution policies and programs to sustain purchasing power on the part of the 99 percent of the population who are dependent on their labor worker earnings or welfare to sustain their livelihood. By stimulating economic growth tied to broadened productive capital ownership the benefits are two-fold: one is that over time the 99 percenters will be enabled to acquire productive capital assets that are paid for out of the future earnings (tax-deferred future savings) of the investments and gain greater access to job opportunities that a growth economy generates.
http://www.reuters.com/article/2012/06/06/us-column-dcjohnston-top-idUSBRE85500720120606
