Monday, August 13, 2012

Yea, Obama! Middle-class taxpayers will pay a mere 50 percent of their income in taxes next year!

Turns out that total taxes -- even for the most modest of middle-class incomes -- will total around a shocking 50 percent next year:

A middle-class taxpayer’s income is subject to a 25 percent federal income tax. Then there is the federal Social Security and Medicare payroll tax of 13.3 percent in 2012—5.65 percent of that is removed from the employee’s paycheck, and the remaining 7.65 percent is paid by the employer. (In reality, the employee pays the entire 13.3 percent, because the employer’s portion of the tax does not affect the cost of labor: The employer would pay the employee 7.65 percent more if there were no employer’s portion of the payroll tax.)

So the 25 percent federal income tax plus 13.3 Social Security and Medicare payroll taxes equals 38.3 percent going to federal taxes in 2012.

And then there are state taxes. According to the Tax Foundation, the average state’s income tax rate for the middle-class taxpayer is 4.82 percent, which brings the total to 43.12 percent in federal and state taxes. And it’s going higher, thanks to the nearly $500 billion in tax increases for 2013 that some have called Taxmageddon. In January of next year, the federal income tax rate for middle-class taxpayers is scheduled to rise from 25 percent to 28 percent, and the payroll tax is scheduled to rise from 13.3 percent to 15.3 percent. This drives the marginal tax rate based on the aforementioned three taxes to 48.12 percent. Add in state and local property, corporate, excise, and other state and local taxes, and the percentage of each additional dollar that is taxed hovers around 50 percent.

...It is outrageous that any dollar earned by a middle-class taxpayer would go as much to taxes as to supporting the taxpayer’s family. The government didn’t earn the taxpayer’s paycheck and shouldn’t be entitled to it.

Oh, but this bloated, unconstitutional, bankrupt leviathan is a bargain at half the price!


bones said...

More of the economy will go underground and revenues will actually drop.

Anonymous said...

I think it was Will Rogers that said "we should be happy we arn't getting all the government were paying for"

chundog said...

And don't forget the sales tax collected by most states. Although I guess you really don't need to buy anything.

Unknown said...

This isn't taking into account local and county income taxes. In Maryland there is a county "piggy back" tax that can go up to 50% of the state tax rate.

Anonymous said...

New Hampshire and Tennessee only tax income from dividends and interest, FWIW.
Taxes by State


Whitehall said...

Too low for California. Earning more that about $60k and you're in the 10% state income tax bracket. It gets very progressive very quickly on the middle class.

Of course, that's the marginal rate so net depends on how much over $60k you make.

JimGl said...

Have you left out Real Estate taxes?