http://www.enterstageright.com/0400taxslave.htm
Are Americans tax slaves to the government?
By Ralph Reiland
web posted April 17, 2000
Your taxes are done, and you're about to breathe a huge sigh of relief.
Not so fast! The nightmare isn't over on April 17.
If you stop for a $10 pizza on your way home from dropping your 1999
tax return at the post office, the taxman will be right there to grab a slice
or two. On top of paying the sales tax, you will also be picking up a
major chunk of what government charges the pizza-shop owner for
property taxes, unemployment insurance taxes, federal payroll taxes,
federal, state, and local income taxes, and worker's compensation
taxes. Altogether, according to a study by Americans for Tax Reform,
the taxman gets $3.80 on that $10 pizza.
If you're flying the next day, the taxman is up early and waiting at the
airport, pocketing $40 on every $100 spent on an airline ticket. And
he's there in the hotel lobby when you land, snatching $43 on every
$100 of the hotel bill. Go out to dinner and another $28 of every $100
of the tab ends up in the government's pocket rather than with the
restaurant, the farmers, truckers, and everyone else who worked
together to produce the meal.
No matter where you turn, the hand of government has its fingers in
every pocket. A recent study by Price Waterhouse shows that 30
different taxes imposed on the production and sale of a loaf of bread
account for 27 percent of the average retail price. Buy some new tires
and $36 of every $100 you pay goes to the taxman. On the price of a
new car, Americans for Tax Reform says total taxes reach 45 percent
of the showroom sticker price. Add some gas and 54 percent of what
you pay goes for 43 different federal, state, and local taxes, rather than
to the oil producer and retailer.
Taxes now eat up an incredible 38 percent of the gross income of the
average family, a higher peacetime rate of taxation than the American
people have ever experienced. By comparison, the typical two-income
family in the mid-1950s paid 28 percent of its income in taxes.
Each year, the IRS sends out 8 billion pages of forms and instructions;
enough paper to stretch 28 times around the earth. To comply with the
U. S. tax code's maze of contradictory rules, deductions, exemptions,
and loopholes, Americans are spending 5.4 billion hours and $200
billion each year. And that's not counting the taxes paid. To put this in
perspective, Americans are spending more time and money each year
on their taxes than it takes to produce every car, truck, and van in the
United States.
When the federal income tax was launched
back in 1913, it was levied upon only the
super-wealthy, the richest one-half of 1
percent of the population, with a top tax rate
of only 7 percent. By the end of Herbert
Hoover's term in 1933, the top rate had
skyrocketed to 60 percent. By the time
Franklin D. Roosevelt was finished in 1945,
the top rate was over 90 percent and
exemptions had been lowered to capture the
incomes of the middle class for the first time.
Michiganians can take some comfort in the fact that what they pay in
taxes to the state of Michigan has been, overall, virtually unchanged
since 1996. But the Michigan Senate Fiscal Agency recently reported
that when you add the growing burden of local taxes to your state tax
bill, the total amounts to 11 percent of personal income. That's just as
high as the high-tax days of Governor John Engler's predecessor,
former Governor James Blanchard.
In 1913, the average family in America had to work until January 30
before earning enough to satisfy the taxman at all levels. This year, the
average American family will work through mid-May in order to earn
enough to pay federal, state, and local tax bills.
"Compare this to the plight of medieval serfs," says economist Daniel J.
Mitchell of The Heritage Foundation. "They only had to give the lord of
the manor a third of their output and they were considered slaves. So
what does that make us?"
Like I said, it ain't over on April 17.
Ralph Reiland is associate professor of economics at Robert Morris
College in Pittsburgh, Pennsylvania, and an adjunct scholar with the
Mackinac Center for Public Policy in Midland, Michigan. More
information on taxation is available at www.mackinac.org.
------------------
"Quis custodiet ipsos custodes" RKBA!
Are Americans tax slaves to the government?
By Ralph Reiland
web posted April 17, 2000
Your taxes are done, and you're about to breathe a huge sigh of relief.
Not so fast! The nightmare isn't over on April 17.
If you stop for a $10 pizza on your way home from dropping your 1999
tax return at the post office, the taxman will be right there to grab a slice
or two. On top of paying the sales tax, you will also be picking up a
major chunk of what government charges the pizza-shop owner for
property taxes, unemployment insurance taxes, federal payroll taxes,
federal, state, and local income taxes, and worker's compensation
taxes. Altogether, according to a study by Americans for Tax Reform,
the taxman gets $3.80 on that $10 pizza.
If you're flying the next day, the taxman is up early and waiting at the
airport, pocketing $40 on every $100 spent on an airline ticket. And
he's there in the hotel lobby when you land, snatching $43 on every
$100 of the hotel bill. Go out to dinner and another $28 of every $100
of the tab ends up in the government's pocket rather than with the
restaurant, the farmers, truckers, and everyone else who worked
together to produce the meal.
No matter where you turn, the hand of government has its fingers in
every pocket. A recent study by Price Waterhouse shows that 30
different taxes imposed on the production and sale of a loaf of bread
account for 27 percent of the average retail price. Buy some new tires
and $36 of every $100 you pay goes to the taxman. On the price of a
new car, Americans for Tax Reform says total taxes reach 45 percent
of the showroom sticker price. Add some gas and 54 percent of what
you pay goes for 43 different federal, state, and local taxes, rather than
to the oil producer and retailer.
Taxes now eat up an incredible 38 percent of the gross income of the
average family, a higher peacetime rate of taxation than the American
people have ever experienced. By comparison, the typical two-income
family in the mid-1950s paid 28 percent of its income in taxes.
Each year, the IRS sends out 8 billion pages of forms and instructions;
enough paper to stretch 28 times around the earth. To comply with the
U. S. tax code's maze of contradictory rules, deductions, exemptions,
and loopholes, Americans are spending 5.4 billion hours and $200
billion each year. And that's not counting the taxes paid. To put this in
perspective, Americans are spending more time and money each year
on their taxes than it takes to produce every car, truck, and van in the
United States.
When the federal income tax was launched
back in 1913, it was levied upon only the
super-wealthy, the richest one-half of 1
percent of the population, with a top tax rate
of only 7 percent. By the end of Herbert
Hoover's term in 1933, the top rate had
skyrocketed to 60 percent. By the time
Franklin D. Roosevelt was finished in 1945,
the top rate was over 90 percent and
exemptions had been lowered to capture the
incomes of the middle class for the first time.
Michiganians can take some comfort in the fact that what they pay in
taxes to the state of Michigan has been, overall, virtually unchanged
since 1996. But the Michigan Senate Fiscal Agency recently reported
that when you add the growing burden of local taxes to your state tax
bill, the total amounts to 11 percent of personal income. That's just as
high as the high-tax days of Governor John Engler's predecessor,
former Governor James Blanchard.
In 1913, the average family in America had to work until January 30
before earning enough to satisfy the taxman at all levels. This year, the
average American family will work through mid-May in order to earn
enough to pay federal, state, and local tax bills.
"Compare this to the plight of medieval serfs," says economist Daniel J.
Mitchell of The Heritage Foundation. "They only had to give the lord of
the manor a third of their output and they were considered slaves. So
what does that make us?"
Like I said, it ain't over on April 17.
Ralph Reiland is associate professor of economics at Robert Morris
College in Pittsburgh, Pennsylvania, and an adjunct scholar with the
Mackinac Center for Public Policy in Midland, Michigan. More
information on taxation is available at www.mackinac.org.
------------------
"Quis custodiet ipsos custodes" RKBA!
