There They Go Again …
“To kick off our show tonight, Mr. Obama will give 95% of American working families a tax cut, even though 40% of Americans today don’t pay income taxes! How can our star enact such mathemagic? How can he “cut” zero? Abracadabra! It’s called a “refundable tax credit.” It involves the federal government taking money from those who do pay taxes, and writing checks to those who don’t. Yes, yes, in the real world this is known as “welfare,” but please try not to ruin the show.”
Hmm. This is a tough one. How can you cut taxes for people who pay no income taxes? Magic? Welfare? Or maybe — just maybe — people who pay no income taxes pay some other kind of tax.
I know, I know: how could there be any sort of tax other than the (federal) income tax? I have heard that in distant lands there are strange, exotic taxes, like the “sales tax”, the “property tax”, “state and local income taxes”, the “capital gains tax”, “use taxes”, “permit fees”, other fees, the “severance tax”, the “occupational privilege tax”, the “estate tax”, the “gift tax”, the “federal excise tax”, and even the fantastically named “generation skipping transfer tax”. But surely we have no such outlandish customs here! We who live in a country that has only one sort of tax, the federal income tax, can only stare in wonder at those benighted countries where people actually pay taxes whenever they buy a shovel or realize capital gains.
I guess that means Cliff May doesn’t have to worry about this either:
“OK, so we all know that taxation without representation is a form of tyranny. But as Kimberly Strassel and others have been pointing out, “40% of Americans today don’t pay income taxes.”
What if, not implausibly, in the next administration that number rises to 51% or more? At that point, the majority of Americans not paying taxes would elect leaders who decide how much the minority must fork over to the government â€” to be redistributed to the majority through government programs and services.
A majority of American would enjoy representation without taxation. This is probably not a form tyranny that Jefferson, Madison, Franklin et al. envisioned.”
Apparently, you just can’t say it too often: just because someone doesn’t pay federal income taxes does not mean she doesn’t pay taxes at all. If the number of people who paid no federal income tax rose above 50%, or even 99%, that would not mean that the majority of Americans were not paying taxes, period.