THE RICHER ARE GETTING POORER
August 30, 2004
The caricature of the wealthy getting by on the backs of the poor is simply not accurate, writes Geoffrey Colvin of Fortune magazine. Instead, he says, the well-to-do pay more than their fair share of taxes.
Despite the rhetoric delivered by both parties, the reality remains that the rich pay the bulk of America's taxes:
- The 20 percent of Americans with the highest incomes took in 52 percent of total income but paid 83 percent of America's income taxes in 2001.
- Similarly, the top 10 percent paid 70 percent of total income taxes that same year.
- Those that earn $200,000 or more in income accounted for just 2 percent of tax filers and made 23 percent of total income, yet paid 41 percent of total income taxes.
Moreover, much of America pays no income tax at all. Colvin says the 40 percent of Americans with the lowest incomes actually have a negative income tax rate -- in the aggregate they pay nothing and instead getting money back through the Earned Income Tax Credit -- a fact that many would find astonishing, says Colvin.
Source: Geoffrey Colvin, "At Tax Time the Rich Keep Getting Poorer," Fortune, August 23, 2004.
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