I’m a proud American. I love my country and I celebrate its ideals while not ignoring its shortcomings. That’s what you do for a country you love.
I also hate taxes as much as the next American. It’s one of the few things that we can agree on these days. Taxes suck. It costs us money, the process is a real a hassle, and it’s not always spent on something you approve of. I understand that. I empathize with it, even. It’s like a prostate exam or a colonoscopy. It’s uncomfortable, but when done properly, it spares you plenty of pain and illness later on.
As much as I hate taxes, I’m not among those hardcore libertarian types who call taxation outright thievery. I’ve learned over the course of my adult life that taxes are just part of life. It’s what we collectively pay to operate a functional civil society. It may not be efficient or ideal, but it’s better than the alternative.
That’s why I make it a point to pay my taxes early and in full every year. I’m not rich. I also don’t have a complex array of assets and what not. However, my finances do require that I put a little extra effort every year to make sure I pay what I need. Thanks to the internet and free tax software, it usually takes up half an afternoon at most.
I’m not particularly smart when it comes to taxes and finances. I just know how to keep track of my budget, monitor my money, and spend within my means. That doesn’t take any special education or talent. It’s just common sense and basic math.
This brings me to the purpose behind this post. Very recently, a report came out from ProPublica. It basically confirms through a trove if IRS files what most of us already knew. The richest individuals in this country, and the world for that matter, have been avoiding taxes for decades. Read the report for yourself. If it doesn’t make you upset as a taxpayer, then check your pulse.
ProPublica: The Secret IRS Files: Trove of Never-Before-Seen Records Reveal How the Wealthiest Avoid Income Tax
ProPublica has obtained a vast trove of Internal Revenue Service data on the tax returns of thousands of the nation’s wealthiest people, covering more than 15 years. The data provides an unprecedented look inside the financial lives of America’s titans, including Warren Buffett, Bill Gates, Rupert Murdoch and Mark Zuckerberg. It shows not just their income and taxes, but also their investments, stock trades, gambling winnings and even the results of audits.
Taken together, it demolishes the cornerstone myth of the American tax system: that everyone pays their fair share and the richest Americans pay the most. The IRS records show that the wealthiest can — perfectly legally — pay income taxes that are only a tiny fraction of the hundreds of millions, if not billions, their fortunes grow each year.
Now, I understand that I’m not rich. Most of us will never know what it’s like to live in the world of a billionaire. Their day-to-day life, as well as their perspective of the world, is just so completely different from most people that it might as well be alien. We can barely grasp the idea of having a million dollars, let alone billions.
However, I can still do basic math.
At the moment, the highest federal income bracket for a single person in the United States is 37 percent. Compared to the rest of the world, that’s pretty reasonable. If you made $10 million in one year, your federal tax liability would be approximately $3.7 million. Add in state and local taxes and it’s about $4.4 million.
Yes, that’s a considerable amount of money.
However, $5.6 million is also a considerable amount of money.
That’s enough money to buy a good sized home or several. That’s enough to buy a fleet of overpriced cars, crash them, and then laugh about it the next morning. If your lifestyle is such that you can’t live comfortably for a year on that, then something’s amiss here.
Again, I understand the world of the super rich is different. They have legitimate concerns that us non-rich people don’t. It’s not unusual for a rich person to spend a considerable amount on home and personal security. Then again, such elaborate security would be less necessary in a functioning civil society with quality public services, solid institutions, and well-funded infrastructure.
That’s not a utopian vision. Other countries are able to achieve this while still maintaining a commitment to free enterprise, individual liberty, and entrepreneurial endeavors. Doing so requires taxes. Moreover, it’s necessary that citizens actually pay those taxes.
This brings me back to the rich people who put so much effort into paying as little as possible every year for taxes. I know they’ll never read this. They’re too busy counting their money and/or deciding what to spend it on next. After reading this piece, I have just one simple request for you on behalf of all Americans, as well as anyone with a shred of decency.
Please pay your goddamn taxes.
It’s good for society.
It’s good for the economy.
It’s good for the public institutions that we all rely on to have a functioning, civil society.
It’s even good business for you, overall.
Just think about it. If rich people paid their taxes, then we could improve infrastructure, pay for quality education for more people, and just put more money in the pockets of people who need it. That is not a radical idea. It’s not socialism, communism, or some other anti-American ideology. In fact, preventing a system that has a class of aristocrats with immense power over the masses is as American as it gets.
On top of that, there’s a good chance that the poor and middle class people who get that money are going to spend it on something. They may even spend it on one of the businesses that rich people own and operate.
In a sense, you’ll get that money back eventually. You’ll just help improve the lives of ordinary people, who also happen to be your customers. It’s win/win at every level. There is literally no downside, other than the fact that obscenely rich people will not be nearly as obscenely rich.
Honestly, though, what’s the difference between having $15 billion and $1 billion? That’s still more money than most people could ever spend in a lifetime. When you die, you can’t take it with you and those who inherit it will not value it as much, since they did not earn it.
In essence, paying your taxes is probably the best thing you could do with that money in the grand scheme of things. Even once you pay your share, you’ll still have plenty for cars, yachts, and gold toilets. I love capitalism too, but greed and hoarding will destroy it in the long run. Taxes are the price we pay to keep that system as fair and honest as possible in an imperfect world.
Do your part.
Pay your taxes.
If we can do it, then obscenely rich people with immense resources have no excuses.