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User avatar #7205 - natedizzie (08/20/2012) [-]
Just saw a commercial from Obama saying that Romney pays less taxes than most Americans. He pays 14% on 20 million dollars. Well I don't know most Americans but I hope they're not paying $2,800,000.

Can someone explain to me how he pays less taxes?
#7243 to #7205 - repostsrepost (08/20/2012) [-]
He doesn't pay less taxes. He pays capital gains which is taxed at a lower rate than salaried income. Congress did that to encourage everyone to invest more money. The result is a lot of rich people do not take a salary and put everything in investments to pay a lower rate. There's also loopholes and deductions. I'm not criticizing them for doing that, I'd do it too if I could. Though honestly I'm in favor of a flat rate that everyone pays no loopholes or deductions to make it simpler and fairer.
User avatar #7275 to #7243 - deltadeltadelta (08/20/2012) [-]
No nation uses flat income tax rates because that leads to gross income inequality. The entire world has been using progressive tax rates since the early 20th century.

The rich pay a higher percentage of their income in taxes because they can more than afford it. Non-wealthy folk pay lower taxes because they're the ones that the economy is dependent upon. They provide the products and services as well as purchase them. Having the poor pay a higher tax rate than the rich is disastrous for any economy.

Those that push for lower and lower tax rates on the wealthy are very short-sighted and are only concerned with large short-term gains while they pillage their own country.
#7294 to #7275 - repostsrepost (08/21/2012) [-]
False. Hong Kong and Estonia both use a flat income tax. And Hong Kong has achieved a per capita GDP on par with the US in a very short period of time and Estonia is the fastest growing economy in Europe.
#7313 to #7294 - deltadeltadelta (08/21/2012) [-]
I apologize, I was wrong.

Nevertheless, nearly all that employ it are third world and tax havens.

A flat tax may seem desirable because of its simplicity, but it causes income inequality. The problem in the US is that there are so many loopholes in the tax code that the rich don't pay the 35% they're required to, and instead pay 15% or less.

In Canada, the progressive tax rate is as follows:

Income Bracket Marginal Tax Rate
$0 – $10,320 0.00%
$10,321 – $12,269 15.50%
$12,270 – $15,658 27.60%
$15,659 – $36,848 21.55%
$36,849 – $40,726 24.65%
$40,727 – $64,881 31.15%
$64,882 – $73,698 32.98%
$73,699 – $76,442 35.39%
$76,443 – $81,452 39.41%
$81,453 – $126,264 43.41%
$126,265 + 46.41%

You might say that is high, and I'd say it is too, but with that we're also provided with free healthcare, better and cheaper education, high-quality law enforcement and we don't have any pot holes in our roads. We're okay with paying higher taxes.
User avatar #7209 to #7205 - Ruspanic (08/20/2012) [-]
Less in percentage of income, not dollars.
User avatar #7208 to #7205 - cartmanismyhomeboy (08/20/2012) [-]
He pays less in percentage.
People in his tax bracket are made to pay 35%
People who pay under 15% make less than $35,000 a year which is under the median income in America.
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