Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, and Wyoming all have no state income tax. Am I missing something, or is this graph just misinformation?
As a proportion of their income maybe, but X% sale tax of one rich dude's glamour item(s) - expensive cars, boats jewelry, fashion, etc) could exceed the taxes from many many lower-income essentials.
Yes that's right. This graph is shate and local tax as a proportion of income, which is a much more relevant statistic than absolute dollars when concerned with the impact on the individual's quality of life. There might be other reasons to look at absolute dollars, and percentage of income doesn't tell the whole story when it comes to quality of life, but one is certainly more descriptive than the other for that concern.
I don't buy this, man. Groceries aren't taxxed, and I just don't see how a lower income individual could physically buy the same amount of taxed goods as a multimillionaire
You are in fact just missing something because having no income tax doesn't mean that poor people aren't being taxed. Think of all the other taxes you pay
...sales tax? I don't believe that that would be higher for lower income individuals, seeing as higher income people would purchase more things that are taxeable than lower income people.
The only other tax I can think of is property tax, which again, I would expect to disproportionately be played by higher income people as they are more likely to own property.
I'm not saying that taxing the rich is bad, I'm just saying that there is positively no chance that rich people pay less taxes even if you exclude state income tax.
The cited article is for expenses unrelated to taxes. I would like to reiterate that I am not disagreeing that the system is busted, I'm just pointing out that saying that higher income people pay less taxes in literal tax havens is not possible. If they are only paying for sales tax and property tax, the only individuals who will be paying more taxes are property owners, which because of how fucked the system is, will practically be exclusively higher income individuals. Yes, renting costs more than property tax, but we are talking about taxes. The majority of your rent will not be going back to the government through taxes, but all of your property tax will.
Basic example to help you understand since it can be a little abstract: I make $1000 a week and buy a TV with $10 in sales tax. That comes out to 1% of my income on taxes. You make $2000 a week and buy the same TV. In your case you only pay .5% of your income for taxes on the same item.
Pretty well every state charges a combination of those to fund their state. Some have all 3, some rely on just 1. But they all combine to be part of a person’s tax burden.
Wealthy people dont pay income very much at all, their income is made via capital gains. Also consumption based taxes are the primary thing that this would be so the richer you are the less this will be as a percent of your income.
Capital gains are profits from the sale of assets such as stocks, bonds, real estate, and antiques. Nine states (Arizona, Arkansas, Hawaiʻi, Montana, New Mexico, North Dakota, South Carolina, Vermont, and Wisconsin) provide income tax deductions or preferential rates for all long-term capital gains income. Other states—such as Connecticut, Idaho, Kansas, Kentucky, Louisiana, Maine, Maryland, Mississippi, Nebraska, New Jersey, North Carolina, and Oklahoma—offer tax reductions for realized gains from certain assets located solely within state boundaries.[11] These tax subsidies disproportionately benefit high-income and high-wealth families and tend to worsen economic inequality across both economic and racial dimensions.
Oh man, if only the authors of the study had thought about capital gains taxes, then maybe the map above that's only using income to divide the population would have been better somehow.
Capital gains isn't a "2nd tax on money people already earned". If I put my money in a bank account and earn 10% interest (laughable I know) and I earn $10k on the $100k I have in the bank, I pay income taxes on the $10k. If I buy a piece of land for $100k and I sell it for $110k, I pay capital gains tax on the $10k. In both cases I didn't work for the money and I only paid taxes on the profit.
Capital gains tax is NOT taxing money twice, and even if it was, sales tax is a much more direct "taxed twice" tax. There is no such rule as "money can't be taxes twice" in our society. Capital gains tax should be done away with and all profit should just be called "income" and taxed accordingly, just like the rest of us who work for a living.
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