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One of our biggest cost of living items is the taxes we pay, fed, ss, property tax, sales taxes, state income tax, vehicle taxes and the like. I think that many folks think there is no way to beat them, and there's no doubt its pretty hard. The only way I know of is frugal living. Not buying the big house, new car etc. Why? Because when you purchase any item, a percentage of that also goes to the tax man. Businesses pay taxes too, but the reality is that this cost is passed on to their customers in the form of higher prices. So the only real way to beat the system is don't buy luxury items, don't waste your money on junk, don't buy stuff you don't need just to impress someone. I never really thought about this before but it has given me a whole new incentive to live in a frugal manner. I hate big GOVERNMENT, and the way it has taken over the running of people's lives in our country.
I just checked on the Tax freedom day information. I was shocked to find that as citizens, the number of days that it takes to get to where you've paid your taxes is now 110 days. However, it hasn't been consistently below 100 since about 1960. IN 1900 it was only 21 days. Disgusting.
What where the roads like in 1900? What about utilities? I could go on and on but maybe you would ignore all the other differences between 1900 and 2014
Also I just calculated my effective tax rate including fed income, ss, med, sales and property tax and it comes in under 30% of income so I don't find it to be all that terrible
Last edited by Lowexpectations; 09-03-2014 at 03:30 PM..
As I said in my initial post, that is not all the taxes you're paying. State income? Sales tax? Then the taxes you pay that are hidden. Business pays taxes on their property etc., which they pass on to you the customer. Then look at your phone or electric bill, see the taxes? Stay in a motel; motel taxes. Buy gas, and you're paying gas tax. License fees? Auto taxes on your vehicle. Your employer pays the same amount you do on SS. That tax is passed on to its customers. You're paying more than 30%
As I said in my initial post, that is not all the taxes you're paying. State income? Sales tax? Then the taxes you pay that are hidden. Business pays taxes on their property etc., which they pass on to you the customer. Then look at your phone or electric bill, see the taxes? Stay in a motel; motel taxes. Buy gas, and you're paying gas tax. License fees? Auto taxes on your vehicle. Your employer pays the same amount you do on SS. That tax is passed on to its customers. You're paying more than 30%
I don't have state income tax an I included my sales tax. All in I'm still under 30% personally.
We pay less taxes here in the US than most other countries. However, most other countries have government paid health insurance and a lot more in social services offered to it's citizens than here in the US. If you were to add what we pay for health insurance, doctors and prescriptions, we would be right up there with the rest of them.
What we have cheap here in the US (compared to other industrial countries) is cheap housing and cheap electronics. But we have a MUCH larger poor, under educated population here in the US, which pays little in taxes, and the wealthy who pay very little in taxes, and large multinational corporations, that pay little to no taxes at all. It is middle America and small business that pay the bulk of the taxes. However, with the large multi national corporations playing the still legal inversion game, and the very wealthy doing the same, our government is currently starved for tax revenue. Never before has the government had so little in taxes collected in recent history. (% in relation to population and GDP)
So yes, if you consume less (smaller less expensive house, car, etc.) you can decrease not only your taxes, but your utilities, maintenance etc.
But taxes is not the problem here in the US. It is the large percentage of people and corporations not paying taxes. It is the lack of educational opportunity and on the job training that we used to have that is quickly eroding. It is the lack of spending that holds up back, which is due to low wages. Trickle down doesn't work. Decent incomes with disposable income is what creates jobs. I don't know about you, but I would rather have to pay more in taxes by having a larger income, than try and pay less taxes on a small income.
Last edited by modhatter; 09-03-2014 at 05:31 PM..
Never before has the government had so little in taxes collected in recent history. (% in relation to population and GDP)
I don't want to start a debate about economic policy preferences, but I do take issue with this statement, as it is misleading, at least from a federal government perspective (and most of your post deals with federal, not state and local issues.)
Per the Congressional Budget Office, (see An Update to the Budget and Economic Outlook: 2014 to 2024 - CBO click on the link for the full report, and check out Figure 1-2), the 40 year average revenue for the federal government is 17.4% of GDP. While we were running below that in the past few years, thanks both to the recession and certain government policies (such as the temporary 2% decrease in OASDI taxes), CBO projects that revenues will increase to 17.5% of GDP this year and increase to between 18.0% and 18.3% starting in 2015.
So, your assertion that the government has never had so little in taxes collected in recent history may be correct, but there hasn't been such a recession in recent history, either. The implication of your statement was that this would continue to be the case, too. I just wanted to point out that in reality, current policies will have revenues significantly above the historical average within the next year or two.
What where the roads like in 1900? What about utilities? I could go on and on but maybe you would ignore all the other differences between 1900 and 2014
Also I just calculated my effective tax rate including fed income, ss, med, sales and property tax and it comes in under 30% of income so I don't find it to be all that terrible
Under 30% is impressive.... doubtful, but impressive.
Exposure to all taxes is difficult to calculate, especially trying to find an Average because incomes vary so much. But some of the better estimates I've seen range from 35% for low income people to north of 50% for well above average people. Remember there are things like Estate taxes, death taxes, etc.
I'm taxed on my way to work every day. I've paid sales tax for my (used) car, registration fees, inspection fees, gas tax, toll road fees, even tax and fees for the tires on the car.
Under 30% is impressive.... doubtful, but impressive.
Exposure to all taxes is difficult to calculate, especially trying to find an Average because incomes vary so much. But some of the better estimates I've seen range from 35% for low income people to north of 50% for well above average people. Remember there are things like Estate taxes, death taxes, etc.
I'm taxed on my way to work every day. I've paid sales tax for my (used) car, registration fees, inspection fees, gas tax, toll road fees, even tax and fees for the tires on the car.
Fees = Taxes, and Taxes = Fees.
For most states, there are not unless you leave more than 5.25 million. Other states that still do, exempt family members from such taxes. See:Where Not To Die In 2013 - Forbes
Now combine that with the ultra wealthy, and the ultra poor, and the rising cost of social taxes (social security of medicare - the only cost that is sharply increasing) and we have a recipe for disaster for the Federal government. The states have been for the most part increasing taxes over the years, but certainly the Federal government has not.
Now we can change this downward projectory by stopping all the tax evasion tactics on the high end, and by doing something about offering educational opportunities to raise people out of the low income hole they are in and gradually bring the low income into the middle income bracket. Currently, we are taking away all such avenues and making it harder and harder for someone to improve their station in life. We did it once before. We can do it again. But our government needs to once again start investing in it's people instead of big business. Big business knows full well how to act in their own best interest.
What do you think "On the Job Training Programs" could do for the poor needing to learn a skill or profession. Here's where minimum wage coupled with paid for night school might make some sense.
Almost nobody pays the estate tax. We should all have such problems. I think the taxes I pay are very reasonable considering all the roads, parks, schools, policemen, firemen, servicemen, sanitation collection, jails, and so on. Unfortunately, a lot of people take all of these things for granted and just want something to complain about.
Under 30% is impressive.... doubtful, but impressive.
Exposure to all taxes is difficult to calculate, especially trying to find an Average because incomes vary so much. But some of the better estimates I've seen range from 35% for low income people to north of 50% for well above average people. Remember there are things like Estate taxes, death taxes, etc.
I'm taxed on my way to work every day. I've paid sales tax for my (used) car, registration fees, inspection fees, gas tax, toll road fees, even tax and fees for the tires on the car.
Fees = Taxes, and Taxes = Fees.
My wife and I made 180k ish last year.
Fed income 13%
Ss/med 7.65%
Real estate 3.4%
Sales tax 3.8%
That still leaves another 4000.00 available for other taxes not to mention my sales tax estimate is probably high. Estate taxes? Terrible example that impact very few people. Death taxes? Are you making things up now? Tolls aren't a tax either
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