Why does the government seem to favor the rich who pay less in taxes?

Question

Sure seems like it to me. The people who can afford taxes the most seem to pay the least.

MrOracle · Accepted Answer

In 2022, which is the most recent year that full data is available, the top 5% earners paid 60% of the total income tax collected. The top 50% of earners paid 97% of all income tax. The lower 45% of earners paid zero or less than zero income tax (meaning, with tax credits and rebates, they had a net gain).

A few years ago, when Elon bought Twitter, he cashed out more than $40B in stock and as a result paid $15B in Federal income taxes, the largest income tax bill of any individual in history.

The idea that rich people don't pay taxes is a lie, and it's straight out of the Marxist playbook.

What IS true is that when any person owns stock in a company, and the stock value rises, that additional value isn't considered income (or capital gains) UNTIL it is cashed out. This is because despite the shares having value, you aren't able to spend that value (at least, not directly) without selling that stock and thus reducing your control of the company as a shareholder. But when you DO cash it out, you pay capital gains taxes on that money.

Marxists want to tax the value of people's stock shares, so they can steal companies away from their owners and give them to the government, so they spread these stories about the rich not paying taxes, but it's a lie. For anyone who has taken the risk and worked insanely hard to get a company off the ground and keep it alive, the idea of the government deciding that you owe taxes on the value of the company you built, even though you haven't realized that value yourself, is insane, but that's exactly what Marxists are trying to convince people that should happen. And that would destroy businesses en masse overnight, and millions of people would be out of work and almost no one would even try to start a business because it would just get stolen by the government, so why work that hard?

That's exactly how a nation becomes Cuba or Venezuela or North Korea.

Singhaeshwaryakumar · Accepted Answer

I think part of the problem is that ordinary people often earn money through salaries, and taxes are deducted directly from their income. Wealthy people may have more options, such as investments, deductions, business expenses, and other tax provisions that aren't equally available to everyone. Of course, not every wealthy person pays less tax, and tax systems differ from country to country. But I believe the system should be transparent and fair, so people contribute according to clear rules rather than having an advantage simply because they can afford better tax advisers. The goal should be to reward hard work and entrepreneurship without placing an unfair burden on ordinary workers.

OlderAndWiser · Answer

Your question asks about taxes in general but the meme you posted specificall8y refers to the social security tax. Others, such as @MrOracle, have addressed why you are wrong about federal income tax. With respect to social security tax, the amount that we pay is what qualifies us to receive social security benefits when we reach retirement age. In 2026, if a worker retires at age 70, the monthly amount of benefits is capped at $5,181. Social Security has determined that taxing someone on their first $184,500 is sufficient to provide funds for paying $5,181 per month in later years, so why would anyone on earth think it is fair to tax that worker on their earnings above $184,500?

Nik1hil · Answer

Government Taxes the Earings Not the Networth!..

Government cannot Tax Networth.. because Government wants People to Built a Networth. Which is How People Stay Rich, and Rich People Means a Rich Nation..

If a Government started Taxing Wealth, then we are no longer in Democracy, we are in Socialism or Communism.

Key is to Increase your Wealth without Making it Count as Income.

Example if I Make a Company and sell it for 5 million.. My 5 Million can be taxed.. but if.. before I Sell my company..

I go to a Bank and a CA and look for "Exemption of Tax under Repayment of Debt" ..

There is a total Exemption if I acquire a Property.

Since Government Taxes "Income" in Income Tax.. but Earning is Not Income..

Earning - Expenses = Income

So My CA Figures out a Way to show a mansion I Buy as "Expense" legally.

Following which I and my CA go to Bank asking for a Loan of 4.8 Million to Buy a Mansion worth 4.7 Million.. Bank Understand and See that I am in process of Selling a Company worth 5 M, and Instant gives me a Credit loan, To be Paid within one Year.

Then I Go and Use the Loan Money to Buy the Mansion, and show That I am in Debt of 4.8 Million, Which is a Financial Loss and My Earning is negative 4.8M.

Now I Sell my company for 5 Million and Pay the Debt..

End of Financial Year.

My earning 5 Million - My Debt 4.8 M = My Income 200K.

Even though I Earned 5 Million & acquired a Mansion.. Repayment of Debt!. method reduced my Income to just 200k on Paper.. and That what Government can Tax, according to its Policies

Ill_made_Knight · Answer

The social security tax cap scales alongside the national average wage index. Since the 80's our national productivity has outpaced the wages of the bottom 90% by leaps and bounds constantly, therefor Social Security is underfunded because it's funding has been tied to wages rather than productivity. Like you said, the rich keep on getting richer and we need to raise that cap... problem solved. We also have to elect people that want to tax the rich and are willing to stand up to the wealthy or it will never happen... corruption at work. Bernie Sanders has been making these arguments for decades.

AviatorTom · Answer

Where do you get the idea that the rich pay less in taxes?

In the US, and many other countries, the tax rate is a sliding scale, increasing with greater income. It's called a progressive tax system, where the more you earn, teh more tax you pay.

In the US, the wealthiest 1% of people pay around 40% of all income taxes. The remaining 99% only pay 60% of all income taxes.

And please note that wealthy people pay more in property and sales tax, because of their life styles. They live in mansions with lots of land and buy expensive items.

lightbulb27 · Answer

requires a thorough analysis to confirm.

of those I know that make a lot of $, they pay a lot. But when you have a lot and pay a lot... still have a lot left over, so it's frustrating but they accept it.

The problem with starting out in life is ya don't have enough, usually in debt and by time done paying what you need, nothing left over... so any tax looks like a lot.

SS I cannot explain...

People that accumulate a lot, usually via stock market or some lawsuit... they aren't taxed on wealth, so it's easier for them.

MrChinaski · Answer

It gets better. Take Jeff Bezos. Jeff draws a salary from Amazon of $81,840. Has done for decades. Not bad, but it's hard to buy a $0.5 billion yacht on chump change like that. No problem... Jeff owns a lot of Amazon stock so all he has to do is sell a little and... nah... selling Amazon stock would create a capital gains tax event. So instead he borrows to pay his living expenses against the security of his Amazon stock... but since technically he's borrowing to invest in productive assets (i. e. avoiding selling stock) the interest on the loans to pay his living expenses are tax deductible.

Chazmatazz269 · Answer

Money is power. The people and organizations with the most money have the power to influence favorable legislation. Civil servants aren’t becoming multimillionaires on less than a quarter of a million dollars a year salary. They are being paid to create tax loopholes for themselves and their extremely wealthy families, friends, business partners, etc.

shish_kebab · Answer

Do you remember when Rachel Maddow went on the air on MSNBC and claimed Trump never paid a dime in income tax?  
 
 She somehow illegally acquired a copy of his tax return, and without looking at it, opened it while live on television.  
 
 It turns out he paid $40 million dollars that year. Rachel almost got fired because of this screw up.

glennos89 · Answer

Have you ever heard of people who are being souverin?
It basically means that you declare yourself independent of the state which makes you free from having to pay taxes. You dont have to obey civil law anymore. The only laws that still apply to you are the laws of justice, meaning that you can't commit crimes but you can evade taxes

Ronaldinho1 · Answer

The tax system is built to tax work differently than it taxes wealth. Most people earn a living through a paycheck (wages), which is taxed at standard income tax rates. Very wealthy people, on the other hand, make most of their money from investments (like stocks or real estate), which are taxed at lower rates—and only when those investments are actually sold.

abc3643 · Answer

Because of this:

Grond21 · Answer

The bottom 40% of people don't even pay income taxes. The top 10% of people pay 50% of the income taxes. We have the most progressive tax system on the planet. What are you talking about?

ProbablyClueless · Answer

I strongly encourage people to look into the real tax data. Rich people pay a huge amount of taxes. They absolutely pay their fair share.

The problem is the corporations. The idea of a company like Amazon not paying taxes is obscene.

MikeTheBartender · Answer

Which country are we talking about? I'm a dual citizen, USA and Italy, lived in both. Both taxes suck, but USA is a dream compared to Italian taxes.

NathanDavis · Answer

because... those rich people also happen to be the ones that fund their campaigns, projects, careers and more...

Alex-Snow · Answer

Because many in the government are also rich and want to protect their own money and their rich doners money. Just look at Trumpy and all his rich doners and his super PAC.

exitseven · Answer

The hioghest earners do pay the most taxes, however the Social Security cap is unfair, The high earners should pay more into the system.

Snakeyes7 · Answer

They make up 70+% of the government's revenue and the government is doing so much that the constitution did not authorize them to do so really they are paying more than enough.

Pterodon · Answer

No actually they pay the most so stop spreading lies

moddy_the_mod · Answer

Are you dumb? The "rich" pay the majority of the taxes in this country.

Kelly6 · Answer

@nodecision Capitalism

rgdfgdfg · Answer

Because the rich run the government and the poor pay the taxes

jahaims · Answer

The rich run the government

Surely · Answer

Have wondered that myself.

rebeliouse · Answer

do they actually pay the least though?

Why does the government seem to favor the rich who pay less in taxes?

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Why are rich people in the U. S. paying so low taxes for marginal rates?

Why does the government seem to favor the rich who pay less in taxes?

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Why are rich people in the U. S. paying so low taxes for marginal rates?

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