But the top 1% currently pay 38% of all taxes and the top 10% pay 70% of all taxes. The bottom 50% only pay 3%.
I've seen and listened to this narrative from a variety sources many times. Here's what they leave out... The narrative is that the top x% of earners pay x% of "the tax" or "taxes" or some similar wording. Alan exaggerates it even further here saying "all taxes". The sleight of hand — in trying to convince you that the wealthy are already overburdened and paying a disproportionate share of taxes — is achieved by
only talking about
income tax and leaving out all of the
other taxes that are paid by lower income earners and which doesn't look at the total tax burden as a percentage of individual income.
Low to middle income workers, as an example, pay a fixed percentage of 7.65% (6.2% Social Security + 1.45% Medicare) in FICA taxes on
100% of their income. Social Security taxes, however, stop above a certain income limit. Depending on which recent tax year you look at, that cap varies a bit. For a nice round approximate number let's call it $140,000. On income above that amount, Social Security is 0% and Medicare adds an additional 0.9% (on earnings over $200,000 for single filers; $250,000 for joint filers). So, if you earn $45,000 per year, you pay 7.65% in FICA taxes. If you earn a $1 million salary per year, your FICA tax works out to about 3% (0.8% in Social Security and about 2.2% Medicare) of your earnings.
If your $1 million in income is not from work, but from long-term investments, then you're really doing well tax wise as your now paying capital gains taxes instead of income taxes. Those capital gains are capped at 20%, there is a 3.8% Medicare surtax, and 0% Social Security tax.
Now, to get to work or the Country Club, we all pay the same price for gas—including the Federal excise tax on fuel. It's just that, when you're struggling to make ends meet, it's the same size slice, for the fuel and federal tax, coming from a smaller pie.
If you ignore all of the
other taxes that lower income workers pay, often at a higher rate as a percentage of total income compared to the top income brackets — and instead pick the right statistics for a single type of tax — you can create the narrative you want to sell to the masses. Those poor overburdened wealthy are treated so unfairly!
https://en.wikipedia.org/Taxes_revenue_by_source_chart_history