There is much debate regarding whether or not our nation has become a European style social democracy. At the risk of being called an ignorant, racist "Tea Bagger," I would assert it undoubtedly has. In defense of this position, I would like to bring your attention to stories that made news today.
The first is a report from the Tax Policy Center that finds 47% of Americans will pay NO INCOME TAX to the treasury to help cover the costs of national defense, maintenance of infrastructure and the billions in necessary pork to pay off members of congress so the President can pass his agenda. That's right, a full 47% don't pay a dime in income tax.
Although that is pretty bad, it is not the end of the story. There are millions of Americans (the bottom 40% of income earners) who actually get back more in a tax "refund" than they paid into the system in the first place. To me, that isn't a tax refund, it's a wealth transfer. Only a politician could call that a tax refund.
The other story comes from the Wall Street Journal. Current White House Economic Advisor Paul Volcker has given the first signal of the Obama Administrations intention to add a Value Added Tax (VAT) on top of our current income tax. For those who don't know what a VAT is, it is like a national sales tax. The difference is the VAT is applied at every stop in the economy. It is paid by suppliers, manufacturers, wholesalers, brokers, retailers and consumers. Basically, every level of production is taxed.
The VAT is almost a foregone conclusion at this point. The only real question is how high the tax will be. The number being guessed at is 10% as this will yield about a trillion dollars, or 2/3 the current deficit, annually.
So in conclusion: Almost half of our "taxpayers" don't actually pay income taxes. Forty percent of our tax payers actually receive more in tax refunds than they paid in the first place. And the federal government is going to tax every level of production in the economy at about 10%. (Don't believe me on this one.....I'll write about it later.)
Sure sounds like a European style Social Democracy to me.
the only good news is that with the VAT at least all the free loaders that make money off the income tax will be helping me in paying the taxes.....did I just say that out loud??
3 comments:
I have been in the 40% category since I've been in the military. I'm just now starting to earn enough to actually pay into the system vs. taking your money. I'm not proud of it, and I really think that I make enough money to pay my share. Especially considering that we are never, and I mean never going to pay our debt down. Ever.
I think by being in the military, you are doing your fair share.
The VAT tax will launch consumer goods prices through the roof. Stockpile now. The VAT could be applied 5 or 6 times to the same product as it starts from the aquisition of raw materials through to stocking shelves. Marx would be proud.
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