Bloomberg personal finance reporter, Ben Steverman, doesn’t hold with the “trickle-down” theory of economics. Steverman explains why, as he explores what kind of tax reform would be best for the country and fair to all tax payers…
“Let’s say you and I are neighbors. You’re an emergency room doctor, and I don’t work, thanks to a pile of money my grandparents left me.
You spend your days and nights stitching up gunshot wounds and helping children survive asthma attacks. I’ve gotten really good at World of Warcraft, winning EBay auctions, and frying shishito peppers to just the right crispiness.
Let’s also say we both report $300,000 in income to the Internal Revenue Service this year. Who pays more in taxes?
You do, by a lot. You owe the IRS about $38,500 more, assuming each of us pays the maximum with no special deductions. I also have more flexibility to lower my burden with tax planning strategies and other tricks, and I get to skip about $24,000 in payroll taxes that you and your employer must fork over each year…”
~ Ben Steverman
Be aware. Be fair.