Now that Mitt Romney has released SOME of his tax returns, he has inadvertantly blown a major hole in the GOTP meme that elminiating the Bush-era tax cuts for the top 1% will "kill job creation". For a person with his income level, the posted tax rate is 39%. Using loopholes and such, his effective tax rate for 2010 was 13.9%. Someone making $50,000 per year pays a 17% (or higher) tax rate! To justify this by saying that "Mitt paid a lot of money in taxes" is ludicrous! The bottom line is he didn't pay what the tax codes say he should have paid!
The House GOTP has held this country's economic recovery hostage for over a year while they pushed the falsehood that adding 1% back to the posted rate would push unemployment higher and higher. The current POSTED tax rate for the top 1% stands at 39% and, as Mitt has shown, the effective tax rate is FAR LOWER than that. The posted tax rate during St. Reagan's Presidency was 50%!
If this has shown anything, its that the tax codes need to be overhauled from top to bottom and many of these loopholes need to be elminated! I'm certain that there are a lot of us, making far less than $21 million per year, who would also like to pay 26% below our posted tax rate!
Mitt Romney even campaigns on the mantra of the tax code needs to be overhauled. Do I think that Mitt is the person to entrust with that overhaul? Not a chance in hell!
I've used this example a few times while attacking the "tax the poor" crowd, but I think it bears repeating again and again as the "Mitt Romney paid his fair share" crowd will now unashamedly take to the airwaves.
A person has a full-time, minimum wage job and therefore makes a gross of $15,800 a year. After withholding taxes, FICA, Medicare, (let's not even look at state taxes), they are left with approximately $12,130 (17% FWT/Medicare, 7.5% FICA deducted). If they are lucky enough to find a place to rent for $450/month and only pay $100/month in electric/utilities, they are left with $5,530/year.
Assuming they use 12 gallons of gas a week driving to and from that job at $3.25 per gallon, they spend $2,028 per year on gasoline and have $3,502 left over for the year. We have not looked at food, automobile insurance(which is required in many states), local and state fees (such as car registrations and licenses) local taxes, state taxes, sales taxes, or any other expenses. If this person spends $70/week on food for just themselves ($10/day), there's another $3,640 a year gone, leaving them with a whopping -$138/year.
Even if they were to get all of the $3,670 they paid in FWT/Medicare back at the end of the year (which they do NOT get the Medicare taxes paid back), that would still leave them with a massive $3,532 weighing their wallet down for the year. Of course, I didn't factor in sales taxes on any of this (here in TN, it is 9.5% on most items, including food), nor did I calculate any of a thousand other small expenses that crop up during the year - "extravagances" like car repairs, tire replacements/repairs, medical issues, etc. I also did not factor in some of the small things in life like the occasional movie DVD rental (because a trip to the theater is out of the question entirely) or any other things in that column.
So my question is this: EXACTLY HOW MUCH ADDITIONAL TAXES SHOULD THIS PERSON PAY SO THAT THE BUSH TAX CUTS FOR THE TOP 1% DON'T HAVE TO END?