This will put me in a sour mood tonight, as I work on my taxes. The 25 richest people in the U.S. paid an effective tax rate of only 3.4% from 2014-2018. Krystal and Saager discuss this “phenomenal” reporting by Propublica [1] (based on a “immense” secret trove of never-before-seen IRS records). They mention that the highest U.S. tax rate is officially 37%, for those making more than 628,000. My next stop will be Propublica to better understand how the super rich avoid paying taxes. Meanwhile, the median income U.S. household, often living paycheck to paycheck, pays an effective income tax rate of 14%. I assumed something like this, but these numbers are outrageous. This is stealing in broad daylight. This shouts: “Let them eat cake.”
Here is a quote from Propublica [1]that will be deflating for those who think that the Biden plan will be transformative regarding the tax burden on the wealthy:
The revelations provided by the IRS data come at a crucial moment. Wealth inequality has become one of the defining issues of our age. The president and Congress are considering the most ambitious tax increases in decades on those with high incomes. But the American tax conversation has been dominated by debate over incremental changes, such as whether the top tax rate should be 39.6% rather than 37%.
ProPublica’s data shows that while some wealthy Americans, such as hedge fund managers, would pay more taxes under the current Biden administration proposals, the vast majority of the top 25 would see little change.
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