Federal Government Tax Receipts (Defining by sources)
By Jazzbumpa at Retirement Blues comes this re-posting that runs parallel to Dan Becker’s post here.
Federal Government Tax Receipts
Where do you think they come from? I’ll just give it away: Personal Income Taxes, Corporate Income Taxes and FICA (the payroll tax: you know that hyper-regressive flat tax – nominally for Social Security and Medicare – with a ceiling, and from which there are no exemptions nor deductions.) Note: Other sources of income – excise taxes, and other miscellaneous revenues are not included in this analysis, and are excluded form the totals.
OK. That was easy. This one is not. How much of Federal Taxes do you think comes from each source?
Oooh. Toughie. I suspect you will be surprised. I sure was The White House Office of Management and Budget is a Storehouse of useful information – including the answer to this vexing question.
Here is a graph showing the log of tax receipts from these sources, since 1934. Individual Taxes in Blue, FICA in Yellow, and Corporate in Red. This is on a log scale. The upside: constant growth presents a straight line. The downside: differences on that scale are really hard to assimilate.
What we can see here is that there was a time in the late 30’s when receipts from corporate taxes and personal taxes were about equal. It was even a 3-way near-tie with FICA for a couple of years. After that, corporate taxes steadily declined for decades as a portion of the total. (The spike down in the data between 1976 and 1977 is due to a separately tabulated calendar quarter in the tables.)
Here’s a close up of the last couple decades, on a linear scale.
Imagine what the size of the deficit would be without FICA! Ponder the meaning of these lines at a time when corporate profits are at record highs, and unemployment levels are at record highs!
Now, lets look at the data in a totally different way, to put all this in perspective. Here, each source is presented as a percentage of the total Federal Tax Receipts.
Can’t tell you exactly what I might have expected, but it sure as hell wasn’t this. Pick your inflection point – either ’77 or ’84 will do. Since 1977, the percentage of the total paid by corporations has wobbled around a bit, but averaged 11% of the total. The percentage coming from personal income tax has been 50%. Obviously, the amount contributed by FICA is 39%. Let’s have a look at trends since 1977.
The corporate tax trend is basically flat at 11%. The contribution from individual taxes is actually at a slight decline. Meanwhile the trend for contribution from FICA has steadily increased for well over 30 years!
Are you as shocked as I am?
Here, to put the perspective in perspective, is a look at total receipts, on a log scale.
I’ve placed a couple of best fine lines, a blue one through the entire data set, and a red one through the period 1958 to 2000, which seems a little more regular than the entire set. At the far end, we had the Great Depression and WW II. At the near end we had Bush tax cuts, Bush wars, an the ensuing Great Recession. Surprisingly, the red line has a slightly lower slope than the blue line. Not surprisingly, total receipts have been close to flat for the last decade, as the Bush tax policies have succeeded in starving the government.
1) During the post WW II golden age, the corporate contribution to total tax receipts, though continually declining, was typically far greater than during The Great Stagnation – the period since roughly 1980.
2) The FICA contribution to the total, despite a break point to a lower slope circa. 1980, has grown steadily since WWII. It is now virtually tied with personal income tax for the biggest contribution chunk.
3) Since the turn of the century, tax cuts and a stagnating economy have caused a huge gap in tax receipts. Grover Norquist’s plan to destroy government by starvation is working like a charm – at the Federal, State, and local levels.
4) Not shown here, but obvious if you think about it or look for the data, is the decline the growth in government spending, at all levels – for everything except defense – since 1980.
If, like Norquist, you want life without government, take a look a Somalia. Or dig out A Distant Mirror by Barbara Tuchman and see what life in Europe was like in the 14th Century – a time when society deteriorated, there was little or no effective government, and roving bands of thugs terrorized peasants, kings, and even the Pope.
You mean well, and I am not allowed to use the word for “unaware of the facts,” but comparing FICA to Income Tax is like comparing your grocery bill to your tax bill.
Are we supposed to be unhappy because we pay almost as much to eat as we pay to buy jet planes for the air force?
You, and the Democratic Party of late, have fallen into the trap of thinking of Social Security as a “tax,” worse, a “regressive tax.”
Try to think of it as a way to save your own money for your own retirement… which is what it is, guaranteed against inflation, immune from market losses, and insured against personal losses or even failure to thrive.
Trouble with this post is that you won’t understand it. Neither will 99% of the rest of the people who actually read it. And no one will care enough to do anything abut it.
But currently it is the DEMOCRATS calling for defunding Social Security, and it’s all made possible because you don’t understand the first thing about Social Security.
Social Security is not welfare.
The whole beauty of Social Security is that it is not welfare, yet it keeps people out of poverty.
Welfare is ugly.
Welfare is you going to the government proctologist every couple of months so he can examine you for hidden assets.
Welfare is “the rich” paying for “the poor,” and you know how that works: The rich are constantly trying to cut benefits, and “prevent cheating.” And the poor learn to shuffle and say yass boss.
But that’s what our liberal friends want. And our rulers are smarter than you. They have killed Social Security simply by refusing to take your money. They know you’d rather spend it at Wal-Mart on a new plastic toy than save it for your old age. Because you are too dumb to understand you will really really wish you had saved it when you do get old, as you will.
And now Obama and the Democrat leadership are smirking up their sleeves: The Republicans won’t dare “raise taxes on the middle class in an election year”… that means won’t dare let you put your own money into Social Security so you can hope to retire some day before you get a note from the doctor saying you have one year to live.
When Bush wanted to privatize Social Security he at least offered a “plan” to invest your money. Obama has privatized Social Security and left you with nothing, except faith in the willingness of the rich to pay for welfare for you when you are old and out of work.
As far as I can tell the ordinate is either dollars (logarithmic) or percent-of-tax-receipts.
a better choice would be simply “percent of income.”
in that graph, FICA would be flat since 1983, the fall in personal and corporate taxes as a percent of income would be easier to see… and i think make jazz’s point better. that is, that taxes are falling as a percent of income, except SS which is not a tax, but your grocery bill.
that’s your grocery bill after you are no longer working.
sort of like your budget for sunday dinner, which you save for by not spending it all on friday night.
Obama wants you to spend it all on Friday night, so you have to go to church on Sunday and beg for food, or do without.
or maybe you could get a job sweeping out the church on sunday after the quality folks have gone home.
Pick my inflection point? I’d say 1950-52 as the inflection point. The % from corporate taxes has been steadily decreasing, reguardless of who’s President or who’s got control of Congress (I believe that would be the Dems for the most part). The 1984 inflection point looks like were the steady drop finally leveled off. (it would have hit 0% in the mid-90s if the trend had continued – by eyeballing it). So in this case you would have to actually give kudo’s to Reagan and the Dem congress of the time for stopping the decline.
Bush Tax cuts? The ones passed in overwelmingly bi-partisan manner and then actively sustained by overwelming bi-partisan vote, led by the Democratic President Obama, do you mean those tax cuts? Now called the Obama Tax cuts BTW(this is a reality based blog). (Looks like the Governor Norquist boggey man is pretty bi-partisan).
Bush Wars? The invasions of Afghanistan and Iraq that were overwelmingly bi-partisanedly supported and had the support re-affirmed every year (also overwelmingly bi-partisan votes) even when the Dems could have ended them in 2007 or by Dem President Obama pulling the troops out by summer of 2009 (easily done). The wars that actually were expanded by the huge Dem congressional majorities and Dem President? Including adding another by overthrowing (without congressional authorization BTW) the dictator in Libya? Do you mean those wars?
Your complaint is not with Bush – its with the entire US government since all of the trends you mentioned were all passed and executed reguardless of the President or who controlled Congress. And has the size and scope of the Federal government decreased in the slightest to the fact we are borrowing 40% of the operating budget?
Does anyone think the US Federal Government would not be able to govern if (except for the SS admin and the IRS) every single department took a 5% cut in last years budget as this years budget? Anyone?
As I read somewhere our politicans can’t even find $1.2 Trillion over 10 years and a expected revenue of $44 Trillion – a 2.7% cut. Sorry if Congress and the President can’t cut 2.7% of the federal budget then they are incompetant.
No one wants life without government. You’re being silly. But the leviathan has really, really grown to big. Tell me when the Dems eliminate all arms carrying employees of the Dept of Education. Call me when the bunny inspectors are looking for work in the private sector.
But I forgot – its all Bush’s fault. No Dems in congress or the Presidency…
Islam will change
These graphs really do explain why they are going after SS. Its were the money is. Right now SS funds don’t allow payola to your paticular district. Heck, the administraive overhead is fairly small so you can’t even pad the departments with supporters! No graft available basically.
Except that $2.3 Trillion trust fund that they don’t want to actually pay back.
Considering Obama’s current actions with SS reciepts, I would bet he could ‘fix’ SS by just rolling it into the general fund, eliminating FICA taxes, and up personel and corporate taxes in a progressive manner to cover the delta. If done right I bet you could even increase total gov revenue in this manner. It would also zero out the Trust Fund. And I would also bet he could get the R’s to at least vote for it. Thus during a Obama second term he could ‘fix’ SS and do it as a huge bi-partisan victory that he so badly craves.
That’s what I see as the end game…not privatization, but just absorption into the greater pool of the general fund. (Privatization would be a better alternative than that obviously and ‘do nothing’ better than either).
I would also note that since the 1950 inflection point individual taxes have been flat while FICA has made up the delta, percentage-wise, as corporate taxes dropped.
Islam will change
I think that is basically right. The R’s want to privatize SS. The Dem’s want to turn it into welfare.
To be honest, I agree that privatization, while a really really bad idea, is better than turning it into welfare.
Hate to say this Buff
but i pretty much agree with that assessment.
only I don’t think it makes sense to talk about the R’s and D’s. it’s the good cop and the bad cop, and your choice about which is which.
up until almost today i would have said that on the margin i preferred the dem lies to the republican lies. but the payroll tax holiday has done it for me.
I can’t speak for Jazzbumpa, but I don’t think you can make assumptions based on his observation. (I doubt seriously he is in favor of defunding SSI.) I think the point could be that it is a push back against the bullshit argument of who pays most of the taxes in this country. Is it a tax on income? Does it generate revenue for the Federal governent? Is it used to pay for tax cuts for those that should be paying more? I’m not in favor of privativing, welfarizing or dismantling SSI, but I get Jazz’s point. I think
The word for “unaware of the facts” is ignorant. Go ahead and use it. I’m a big boy.
Are we supposed to be unhappy because we pay almost as much to eat as we pay to buy jet planes for the air force?
Now, that’s a bit of a red herring. My point was to quantify how much of federal revenues (ex fees and tariffs) comes from the various sources that are generally considered to be taxes. I was amazed to discover how much of it is the payroll tax.
You consider it not to be a tax. That’s fine. But it is levied by the government as a flat percentage of income (up to a ceiling, hence regressive.) You have absolutely no choice as to whether you pay it or not. It is used by the government, via borrowing, to pay current obligations. It is called the payroll tax by the government, and the quantity of recipts can be found tabulated with other tax data.
It looks like a tax, acts like a tax, and feels like a tax. You get it back, later in life, as I am now. SS. is a good thing, and privatizing it would be a disaster.
Krugman has described the government as an insurance company with an army. I think that is pretty accurate. By paying FICA you are buying an annuity on the installment plan. I get it.
I also get that having a patroll tax holiday is one of the worst things that can be done, since it effectively defunds the S.S. program.
Sorry I pissed you off. If it will make you feel better, substitute “sources of federal revenues” for taxes.
‘Cuz that’s what they are.
i am almost sure jazz does not favor defunding SS. But it is a fundamental error to think of SS as a “tax.” SS is you putting money away for your future needs. It is only a “tax” because most people wouldn’t think to do it until it was too late, and a “tax” is the only way the government can protect the rest of us from “your” failure to provide for yourself.. otherwise we’d have to give you welfare or step over your body… not good for the economy.
In return the government protects your savings from inflation and market losses and provides a modest interest by the miracle of pay as you go with wage adjustment.
You get the money back with interest when you need it most. It does not “pay for” the government. And “the government” does not pay for it.
It is because people think of it as a “tax” that the bad guys on the right can talk about “huge deficits” and “huge burdens.” It is because the dumb guys on the left think of it as a tax that they can talk about it as “regressive” and plan, so kindly, to turn it into welfare.
It is because they call it a tax that they can give you a “tax holiday” and defund your retirement.
Unless of course you can persuade the rich to pay for your retirement.
The whole point of Social Security is that it avoided exactly that.
Thge discussion above between JazzB, Coberley and Buff (all of whom are correct in their analysis) underscores the lack of repressentative government we are now suffering under. Representatives are being elected to the Congress and the Presidency, but their scope of repressentation is extremely narrow. Games are being played with both the budget, the funding streams and the tax system such that receipts intended to accomplish one goal are being used to supplement other spending in order to reduce the need to enhance the receipt streams intended to apply to those other budget items.
Certainly FICA receipts are a tax, but one which is legally dedicated to fund Social Security. That the excess of those receipts is, again by law, invested in Treasury notes has given rise to the fallacy of the “unified budget” and the ruse of describing FICA as a source of tax receipts applicable to all government spending. How to address both the facts and the stratagem is the problem. The issue is easily confounding and those who are intent to protect the wealth of the wealthy will use every strategy at their disposal, even to the point of gross exaggeration and dishonesty. The average voter can’t make the fine distinctions. Even the participants on this blog site become embroiled in the differences between their individual approaches to the lies. How can we expect the average voter, a total ass in maybe 50% of cases, to comprehend that they are being screwed over?
I don’t mind that the rich pay most of the taxes in this country. They have most of the money.
Asking the poor to pay taxes is like asking the cows to pay taxes.
But they are smarter than you. They have got you saying, but, but, we pay more Social Security tax than you pay income tax.
That’s how they get you to think of it as a tax. So they can take it away from you.
It’s not a tax. It’s your future grocery budget.
Bush Tax cuts? The ones passed in overwelmingly bi-partisan manner and then actively sustained by overwelming bi-partisan vote, led by the Democratic President Obama, do you mean those tax cuts? Now called the Obama Tax cuts BTW.
Yes, those are he ones. The extension was part of a compromise to get extended unemplyment benefits, IIRC. That’s politics, and it’s an ugly reality. I have never heard them refered to as the Obama tax cuts by anyone before now. The Rethug meme is that taxes are higher, not lower under Obama.
Yes, he and his minions lied to congress, the U.N and the American people. Obama is dilatory in bringing these things to a close, but you can’t just pack up and leave on any given Tuesday. I am particualry unhappy about his continuation of bush policies, but they are still Bush policies. The stark idiocy of the Bush regime was cutting taxes and going to war at the same time.
Your complaint is not with Bush – its with the entire US government since all of the trends you mentioned were all passed and executed reguardless of the President or who controlled Congress.
Buff, I know you’ve read Mike Kimel’s posts. He has demonstrated repeated ly that the president sets the agenda for the country. My complaint is with Reagan, both Bushes, and B. Hoover Obama. Clinton was far from perfect, but almost of the trends heading the wrong way were stalled or briefely reversed during his time in office.
The rest of your comment is off-topic.
Yes, I’ve read and commented at length on Mike’s posts. I also don’t believe he demonstrated that the president sets the agenda for the country (which he never was trying to do) nor that the party of the Presidency determines US GDP growth (something he did tried to do and subsequently has backed off of partially – what you were probably referenceing).
If you have never heard them referenced as the Obama Tax cuts you have not been reading many lefty blogs lately. I beleive I first saw the term either at Drum’s place or TalkLeft. It fits and they are now Obama’s Tax Cuts.
As for Bush’s wars. You reguritation of lefty talking points is somewhat amusing at this late stage. Tthe wars were very bipartisanly supported, in one vote 93-3 in the Senate for the annual authorization of funds that I remember off the top of my head. By ANY account the wars were the most bi-partisanly supported effort since WWII by vote counts in Congress. The fact that Obama smoothly took over both Iraq and Afghanistan without missing a beat, started the Afghanistani Surge, and conserved the victory in Iraq – even so far as going it along the Bush withdraw plan, shows that these policies are now Obama’s three years into his presidential service. The idea that Obama has no ownership in these policies at this late date is ludicrous. Come back to reality – this is the Dems party now.
Clinton didn’t change any of the trends that rdan’s posted data showed. There was literally only two inflection points. Early 1950s and around 1984 when the data leveld off. Clinton didn’t change anything, the data just reflects the tech bubble just has it reflects the drop in 2008 due to the recession.
Bush has been out of office for 3 years and the Dems have run congress since Jan 2007. This is a reality based blog, the Dems have had the veto for 5 years now and the White House for the last 3 plus even had total control for two years. All during the biggest recession since the great one. That’s reality.
But yes its all Bush’s fault….
Islam will change
Your last line is a very good question – if you ever find an answer that is actually doable drop me a line!
And no one is after the wealthy, they are after people who are trying (and have a chance) to become wealthy. No one is after Heinz-Kerry’s billion in tax free munis, or Oprah’s 100s of millions. To be honest I have yet to see any attempt to actually tax the 1%. Down here in the backward, flyover state of Texas we actually do go after the rich in rather stiff property taxes. If you want your mansion and 50 acres your going to pay for it. Every year. On the other hand if you are frugal you can basically make the property tax a minor nusance and still live nicely. You can get a nice modest house for under $100K in the best public school district in the area (including privates). If you don’t mind a minority majority (hispanic) school (I don’t) its a great place to raise kids.
Income taxes tax people who want to become wealthy – they won’t touch the people living in the Hamptons.
Islam will change
Actually, Dale, you’ve hijacked my post. You aren’t arguing with me, you’re changing the subject.
The topic is not Social Security, which I mentioned once in passing in the first paragraph. If it were, and I’d made some sort of a mistake about it, than your comments would be on-topic and salient. As it is, you’ve taken us down an irrelvant road.
The subject is where the government gets its money, how the ratios have changed over time, and how the rate of increase in revenues is less than is was when times were good. To a large and increasing extent revenue comes from the working people, rather than the capitalists and/or the rentiers. Failure to recognize FICA as a source of revenue disguises this.
I appreciate your passion for SS, but it is displaced in this context.
I’m performing tonight in Ann Arbor, and need to hit the road. Sorry for bailing out on you.
Property taxes, regardless of how high they may be for any specific residential estate, is the best bargain the rich enjoy and the greatest state wide scam across the country. Most of the receipts from property taxes in wealthy areas goes to cover school costs for the little darlings of the rich. And they’re deductible from federal income tax calcullations. Think about this. If you pay $35,000-$65,000 in annual local property taxes you get to send your several kids to first rate schools. If you’ve got three kids your cost is $10,000 to $20,000 per kid, tax deductible. Otherwise you send them to private school at $40,000 a piece and no tax deduction.
That may be true, but its the only way I’ve seen actually implemented that gets at the wealth. those high property taxes also subsidize the poor who go to the schools also. My kids school has plenty of poor (about half are on some form of subsidized meals and the school provides breakfast also for some students). You can get a 3 bed 2 bath about 1500-1700 sq ft for $85-90K. More than enough to raise a family and send them to where the ‘rich’ kids go. Gary Patterson, TCU Head coach, just bought within walking distance of the local elementary for north of $1M. His property taxes are paying for those poor kids excellent education.
I have yet to understand why you would accept a job (if you have kids) where there was no good public schools. I had to do it once (but the alternative was Minot AFB) and was not happy with writing checks to a private school…
BUt my point is still the same. There is nothing on the table to actually tax the wealth.
Islam will change
you did not piss me off. Obama and the Democratic Party did. I only point out that calling SS a tax is what enables them to get away with cutting the funding of SS.
The government does not call it a “payroll tax” It calls it a Federal Insurance Contributioin. It’s the newspapers and other ignoramuses, some of them with jobs in the government, who call it a tax.
It is essential that you understand why comparing FICA to the Income Tax is like comparing your grocery bill to your tax bill. After all, they are both “bills” and you have to pay them both, so there is really no difference worth mentioning, right?
i did not hijack your post. i yelled at you for comparing SS to the income tax. They are not the same kind of thing at all. And talking about them as though they are makes it possible for bad people to do stupid things and hurt hundreds of millions of innocent folks very badly.
i shouldn’t get into this because it’s a minor issue compared to vivisecting social security.
i don’t worry too much about taxing the rich.. and least not in the sense of taking away what they already have. i don’t like property taxes much, because they tax me whether i have money or not. I suppose i could sell my house and live on the street and not have to pay property taxes.
On the other hand income is a very fluid stream. If I “need” a 100k for doing a job for someone and my tax rate is 30%, I would just charge him 130k… and he would pay it. Or maybe he would find someone who doesn’t need 100k, and i would have to find another job… but that’s just basic free enterprise, with the cost of government as a “fixed cost” like gravity determines how much it costs for a locomotive to haul a ton of freight up hill. That all gets taken care of in the wash.
But with the property tax I can never rest. I can’t say I have made enough, I can retire now. Because every year the governments says my property is worth more so i have to pay a bigger tax… or sell it and live in the street.
I am not envious enough of the rich to want to destroy them by that kind of bleeding.
i don’t think you have analyzed your data very well. SS taxes increased as the program matured… that is as more people retired and collected benefits. but since 1983 the SS tax rate as stated constant, unless you add in the Medicare tax.. which opens another can of worms.
but, here’s my point… the amount by which personal income taxes have declined AS A PERCENT OF TAXES is equal to the amount by which the payroll “tax” has increased AS A PERCENT OF TAXES.
Since corporate taxes have been constant AS A PERCENT OF TAXES, you would have to expect that a decline in A “as a percent of A+B” would be matched by an increase in B “as a percent of A+B”, so all your data amounts to is evidence that Personal Income taxes have been declining relative to some other “fixed” number. You could have ignored FICA… as you should have because it is not a tax…. and said Personal income taxes have declined compared to Corporate taxes. Or said that corporate taxes have increased compared to personal income taxes.
Not sure I see what we have learned from that.
SS Withholding has replaced corporate and individual taxes as the levy of choice to finance the expenditures to date. That it does not cover all expenditures is why the tea baggers, the prty of “NO”rquist, and Norquist seek to reduce all expenditures beyond what is covered by the Social Security Withholding. The effort is to alleviate the 1% of the population from taxes beyond SS Withholdong.
I live near Brighton, MI. Where are you performing dude??? I would come and listen and discuss. WOW!!! Small world
This statement: “FICA (the payroll tax: you know that hyper-regressive flat tax – nominally for Social Security and Medicare – with a ceiling, and from which there are no exemptions nor deductions.)” is incorrect.
Health coverage is deducted from gross for computing the FICA base. So is employer provided health and disability insurance (at least below a specified level). And everybody with Flexible Benefit have a portion of their wage income excluded from the FICA base.
It was a one off, not a regular gig.
Sorry I missed this until now. Had to scoot pretty quickly earlier.
Good catch. Thanks for the correction.
But it is a fundamental error to think of SS as a “tax.”
The IRS calls FICA collection a tax.
The Social Secuurity Administration calls it a tax.
It’s hard for me to believe I’m commiting a fundamental error in vocaulary or concept when I’m using the same word for the sme thing that is used by the relevant agencies.
Maybe you have some evidence to the contrary.
I preseted the three data serie in two forms: as actual numbers, and as % of the total. Either way, FICA reciepts increase steadily through 2009. Not so personal or corporate income taxes, which both declined from 2000 to ’03/4, and again from 2007-9/10.
Have a look at the OMB tables if you think FICA is not a source of government revenues.
The point is that FICA contibution has increased steadily, both in absolute and percentage terms, as a source of Federal funding. I was surprized to learn that. Mabe you weren’t, and got nothing from it. I suspect that is not the most common condition, though.
I would have thught that the obvious conclusions would be that both corporate and personal income taxes – especially from high end earners – need to be collected more vigorously. Having FICA as a primary revenue source places too much of the burden on working poor and middle class payers, and is probably not sustainable.
It’s not clear where I didn’t analyze the data well.
BTW,Here is the defnition of a tax.
Congress passed FICA and FDR signed it into law in August, 1935.
All you have to back up your not-a-tax position is an assertion.
if i could play in a jazz band i would be a happier person. but as it is i am “ignorant” of jazz and told that if i have to ask i’ll never get to know.
all i have to back up my assertion is the hope that you will understand the point behind it.
i don’t care much about the words “it’s a tax.” of course it is. it is also “not a tax.” and if you can’t understand that … well, you’ll never get to know.
SS increases in absolute terms because money numbers keep getting bigger. means nothing at all. SS increases in relative terms as a “percent … of Federal spending” only if you don’t bother to notice that SS is NOT Federal spending. and here we go again… if you don’t bother to make important distinctions, then “of course” SS is Federal spending. But the folks who set up the Trust Fund worked awful damn hard to make the distinction… legally and formally… and it’s a shame you don’t get the point.
Because you end up contributing to the “logic” of the people who want to kill what you say you are in favor of.
To put it in the kind of terms most people use, you are comparing apples to oranges, and making a dangerous mishmash of what no doubt seems perfectly “logical” to you.
BTW don’t bother to cite me book “definitions.” I am trying to explain the real world. I learned, was even taught formally, many years ago that words don’t have “definitions” in any practical sense… they “mean” whatever the guy who hears it thinks it means. And that is the part I am trying to throw some light on.
buff the wealthy receive much of their income from their wealth, and the wealthy often received huge salaries/bonuses that make them wealthy, so income taxes for top earners indeed do target the wealthy and not just those trying to become wealthy. I think people in the latter category generally don’t fall into the top 1 percent of earners (i.e. into today’s top tax bracket) unless they have an unusually good year. I do get your point about nobody proposing to tax wealth directly, like some countries do.
Ah, well – who’s to be master here – me or the words?
I’m wrong, the IRS is wrong, the SS Adminsitration is wrong, the federal budget is wrong, and the legal definition is irrlevant.
That makes me ignorant.
I was going to add that the fact that a tax is specifically designated for a particular end use does not alter the fact that it is a tax. Maybe I shouldn’t bother.
All this bantering about semantics, and precious little discussion of the subject matter, which at one time was sources of federal revenue.
You have indeed, well and truly hijacked my post.
I give up. You win.
Have a nice day.