Links

Tax Reality

The following are rather revealing tax data from 2001 published by the Tax Foundation based on unadjusted gross income:

The top 1% (over $292,900 per year) of taxpayers pay 34% of all taxes
The top 5% (over $127,900 per year) of taxpayers pay 53% of all taxes
The top 10% (over $92,750 per year) of taxpayers pay 65% of all taxes
The top 25% (over $56,000 per year) of taxpayers pay 86% of all taxes

This means that the LOWEST 75% (those making under $56,000 per year) of all taxpayers pay only 14% of all taxes. The average income separating the top and bottom 50% of taxpayers is $28,528 per year. In this context, is the middle class really overtaxed?

Now ask a politician to define both the middle class and the basis of increasing taxes on the “rich,” who already bear the heaviest tax burden in our ostensibly progressive tax responsibility system.

Making matters worse, the tax code is so complicated that the average citizen needs professional help to file their annual taxes. The attendant public and private bureaucracy is massive.

Although it’s not an ideal solution in the Libertarian sense, the following is an incremental step toward true reform and simplification with no effect on total revenue raised:

Exclude the first $55,000 of taxes for all taxpayers
Eliminate all deductions, exemptions, incentives, and special tax provisions
Tax all income from any source above $55,000 at a flat 12%

This approach actually will increase total tax revenues and provide tax predictability for those who already shoulder the tax liability. It is, however, a transitional approach that only acknowledges the reality of our current tax code. It also significantly decreases the size and power of the IRS leviathan!

In combination with the passage of the Enumerated Powers Act, the incremental transition toward reducing the size of the Federal government, and elimination of the federal debt, this flat 12% can be reduced until the it can be completely replaced with a more equitable means of raising revenue for constitutional federal functions.

	Libertarians are...
		The third largest political party and are opposed to censorship of any kind with absolute guarantees of personal privacy and defined constraints on the power and authority of the government over its citizens.