Tax Rants and a BIG Question: Do Millionaires Really Pay Lower Tax Rates?

Sure, this is starting to get redundant, but Americans tend to be people of passion. Just look at the GOP nomination process and see how Ron Paul supporters fiercely defend and stand by their candidate. Look at the popularity of the Super Bowl. Most importantly, look at how close the mainstream media and President Obama are, and look at how they keep broadcasting the same old rhetoric.

I, as a writer of for this blog, an economist, and a political-minded person, am very passionate about taxes. I can't just sit by and watch the mainstream media and Obama spread misinformation.

First, I believe the government is too big and taxes too much. It is scary to know that each of us sacrifice so much to this giant, all-encompassing, wasteful entity that we think we control but we really don't. Have you ever stopped to think how many individual taxes you pay in one day? Ever stop to think how much? You wake up in a bed you paid taxes on. Your home is heated, and on that heat you pay taxes. You brush your teeth (taxes on toothpaste), shower (tax on water), get dresses (tax on clothes), and then you get in your car (excise taxes) which is fueled by gasoline (sometimes diesel, but fuel taxes are HUGE) and you drive to work to make an income that is taxed. I could go on and on; I've only listed the things that get us to about 9 o'clock in our day, but by 9 o'clock, look at how many taxes we have paid already! Keep in mind, I'm not against taxes. We need taxation - it's the cost of civilization. But we have gotten to a point where it's just too much... and it's getting worse. This entire post isn't about tax rates per sé; it's about the truth... I will get to it.

Secondly, on top of all this, in a country that promotes "fairness" and non-discriminatory policies, we believe that one group of people should pay WAY MORE in taxes than another. Without getting into the numbers, based on concept alone, how is that fair? Take our article about Mitt Romney's taxes. We show that Mitt pays about 450x more than the average American does in taxes. The sad thing: the press and President Obama claim that not only is Mitt and people like him not paying their fair share, but they are paying "less than their secretaries."

Hogwash! Plain and simple.

Obama can say what he wants about millionaires, but he should just tell the truth. The case he makes is that millionaires paying lower tax rates than their secretaries is the norm, but is most definitely is not. We have written about this before, and, since we are passionate about it, I/we will write about it again. America needs to simply stop living in this world of myth. Below you can find numerous articles, write-ups and reports from this blog and other sources that can help spread the truth about millionaires' tax rates.

Our blog post about Obama's Osawatomie, KS, speech on income inequality: http://loudmouthelephant.blogspot.com/2011/12/media-and-half-truths-obamas-biggest.html

- We cite the Congressional Research Service Report (http://democrats.waysandmeans.house.gov/media/pdf/112/CRSBuffettRule.pdf), a democrat-sponsored report, mind you, that says, "Among millionaires (see the last two categories in the figure), the average tax rate is almost 30% with about 10% facing a tax rate greater than 35%. Furthermore, another 10% face a tax rate below 24%. Comparing millionaires with moderate-income taxpayers (with AGI less than  $100,000), roughly one-quarter of all millionaires (about 94,500 taxpayers) face a tax rate that is lower than the tax rate faced by 10.4 million moderate-income taxpayers (10% of the moderate income taxpayers), which would be considered a violation of the Buffett rule but not to the extent alluded to by Mr. Buffett." Did you get that? Only 25% of millionaires pay lower tax rates than 10% of middle income earners. It's not "25% of millionaires pay lower tax rates than the entire middle class." No! I will repeat: 25% of millionaires pay lower taxes than only 10% of the middle class. In spite of what President Obama wants to you to believe, millionaires paying lower tax rates than most Americans is NOT the norm. It's a statistical anomaly.

The Cato Institute's write-up of how Obama's millionaire tax rate claim is simply not true: 
http://www.cato-at-liberty.org/warren-buffetts-tax-story-is-bogus/

- This is not our work. Read it... the case is pretty strong.

CNN Money's article about how yes, Mitt Romney pays about 14-15% of his income in taxes, this is still MORE than most Americans:
http://money.cnn.com/2012/01/18/news/economy/Romney_effective_tax_rate/index.htm?iid=EL

- Again, the truth is told. I'm sure it is ignored by the left. They try to claim, "well, he has cap gains and it's taxed lower." Yes, that's true, but don't forget that once you give tax refunds to the middle class, their effective rate drops, too (see the first link, my tax info is up there). When people say "I make $45,000 per year and I pay 20%, as these articles show, they are mistaken. During the year, I have about 20% taken from my paycheck each week, but yes, as the first link shows, I get a tax refund back and it reduces my effective tax rate to about 13.5%.

So... why do we keep writing about this? Because we are tired of lies and misinformation. Yes, some millionaires do pay a lower rate. The deception of this claim comes in when Obama and the press make the case that this is the norm when it clearly is not. Please pass this on. No matter who you vote for in November, you should at least know the truth before you do.