Monday, September 19, 2011

Income tax theft- Billionaire versus Joe Six Pack

Income tax is theft of the poor, middle class, and small business to reward the rich and large corporations. Through the use of "tax breaks" the rich and large corporations take advantages that Joe Six Pack and the small business can't, by design, qualify for. "Tax breaks" are just piles of useless paperwork to the poor, middle class, and the small business.

How is this theft by design? Consider the fictional case of the billionaire versus Joe Six Pack. Let us assume Joe earns the median American household income of $46,000 and the billionaire earns $1,000,000 a year which is about average for someone with $10 billion in assets. How can income tax treat the two fairly? Joe earns $884.62 a week before taxes while the billionaire earns $19230.77 a week.

How could anyone ever devise a way to make their tax burdens fair? It gets worse. Joe has no assets, only debt. The bank owns his house, his car, and whatever he bought on credit. The billionaire has $10 billion in assets, which if they're even remotely competent, are earning 10% a year or $1,000,000,000. If they were smart enough to buy silver, they'd be earning $8.9 billion a year (on average) for the last ten years (but I digress).

If you tax the billionaires salary at 100% it's only 1% of what the billionaire earned that year. ANY tax on Joe Six Pack is exponentially more damaging. A 10% tax on Joe is 10% of everything he earned that year. If we tax the billionaire at 10% of everything earned (as opposed to just salary) that would be more fair.

To be truly fair you would tax based on wealth. In the above example, Joe has no wealth, only salary and a debt which exceeds it. He would pay NO TAX. If we taxed the billionaire at just 5% of his wealth, that's $500,000,000. Want to guess how many of us (Joe) that it taxes to make up for this income tax gift to billionaires?

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