Raising The Income Tax Rate On Millionaires Won’t Work

The Democrats are campaigning to address the deficit by raising the income tax rate  by 3% on  millionaires. The reality is they want it to go up on every family earning $250,000 annually. For discussion sake, let us use the following information:

Fox News Reports:

· Overall Government Spending for 2011 is $3.834 trillion.

· Projected Deficit Government Spending for 2011 is $1.267 trillion

Neal Bortz made an interesting comment. Government figures indicate the average person making 1 million dollars or more a year makes the majority of their money not through earned income, but through Capital Gains. in fact. Mr Bortz reported the average millionaire makes only 6 1/2% of their income from earned income. Capital gains is taxed at a different rate than Income Tax. The only people who this raise in taxes will affect, is those between $250,000 and under $1 million annually. They get the greater majority of their income through earned income.

Another way to look at it is the following;

Let’s assume for argument sake, you earn $1,000,000 from your salaried employment.

  • An additional 3% will raise $30,000 in new taxes.
  • There are approximately 279,000 households with that income
  • This move would raise $8.37 Billion annually

Another way of looking at it,

  • The Federal government currently takes in approximately $214 Billion monthly in income taxes, tariffs etc. or $2.567 trillion annually
  • Fox projected the total  anticipated spending rate for this year to be $ 3.834 trillion or $319 billion monthly. ( we still do not have an approved budget)
  • We have a budget shortfall of 1.267 trillion annually or approximately $105 Billion monthly
  • In a 30 day month, we are currently spending  $10.5 Billion dollars daily of which deficit spending amounts to $3.5 billion daily

The $8.37 Billion we would take in annually from the increased income tax, would cover  just over 2 days of our overspending and less than 1 day of our total government spending.

I repeat we do not have an income issue, we have a spending issue. If Politicians do not understand this, they have to go!!!

2012 is coming!!!!!

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About billmoore353

Retired LTC- USAR Former HS Principal- John A. Holmes HS in Edenton, NC Former HS Principal- Roosevelt HS in Yonkers, NY
This entry was posted in ECONOMY, Politics, TAXES. Bookmark the permalink.

One Response to Raising The Income Tax Rate On Millionaires Won’t Work

  1. Nick says:

    Great post. I have been linking to you on that left wing rag Huffington Post.

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