Texas Insider Report: Washington DC In his State of the Union speech Barack Obama lectured those whom he hadnt already bored to stupor with his usual onslaught of platitudes you probably had no idea that teachers matter" until he said so that anyone earning over $1 million should pay at least 30 to government. Oh and another thing no deductions allowed:
If you make more than one million dollars a year you should not pay less than thirty percent in taxes… In fact if youre earning a million dollars a year you shouldnt get special tax subsidies or deductions."
But guess what those of you among the servile class. Obama unsurprisingly doesnt practice the same class warfare that he preaches.
In the most recent year available Obamas income totaled $1795614. So unlike Americans earning as little as $200000 whom he habitually defines as millionaires and billionaires" he actually is one. But what did Obama himself pay in taxes? Approximately $454000 which amounts to about 25 of his income.
As for deductions that he says millionaires shouldnt get Obama certainly took his share. In fact he claimed almost $400000 worth which is almost as much as his total tax payment.
But hey at least Obama carries his fair share" better than that miserly Mitt Romney right?
Not necessarily.
Amid the curious media feeding frenzy over Romneys 15 effective tax rate - curious" because the same media refrained from obsessing over John Kerrys 13.1 rate in 2004 - the fact that his investment income is double taxed was ignored. Namely before dividend or capital gain income is taxed at the current 15 rate those dollars are first taxed under our current tax regime at the prevailing 35 corporate rate.
Accordingly since the federal government first taxes such income at the 35 corporate rate and then again upon receipt at 15 the top marginal rate actually reaches 44.75.
Making matters worse Americas 35 corporate tax rate remains the second-highest in the world among developed countries. Not only does that punish investment in the double-taxation manner described above it significantly disadvantages U.S.-based companies vis--vis foreign competitors. When we last reformed our tax system 25 years ago our corporate rate was actually among the lowest in the industrialized world. Since that date however we have fallen to next-to-worst.
Moreover businesses and millionaires and billionaires" arent the only ones suffering under excessive corporate tax rate.
According to Ernst & Young Americas high corporate rate reduced wages and benefits for U.S. employees by some $100-$200 billion over the past decade alone. And according to the Heritage Foundation and Milken Institute reducing that rate even to the Organization of Economic Cooperation and Development (OECD) average of 25 would create 500000 to 2.2 million jobs and add $2484 in additional income for the average family of four each year.
Fortunately there is some good news to report from Obamas State of the Union. Amid his assault he actually suggested a willingness to pursue corporate tax reform:
We should start with our tax code. Right now companies get tax breaks for moving jobs and profits overseas. Meanwhile companies that choose to stay in America get hit with one of the highest tax rates in the world. It makes no sense and everyone knows it. So lets change it."
Americans agree. According to Gallup Americans favor corporate tax reform that would help stem the outflow of businesses and jobs by an 82 to 15 margin.
The question now is whether we act quickly while a rare political consensus exists.
More divisive rhetoric and class warfare from Obama wont accomplish anything. He has exposed himself as a hypocrite by not conducting his own affairs in the manner that he demands from the rest of America but he can make amends by converting his more positive words to action.
Its up to us to ensure that Congress and the White House make this happen to achieve a rare convergence between their own political interests and the nations actual welfare.
Texas Insider Report: Washington DC In his State of the Union speech Barack Obama lectured those whom he hadnt already bored to stupor with his usual onslaught of platitudes you probably had no idea that teachers matter" until he said so that anyone earning over $1 million should pay at least 30 to government. Oh and another thing no deductions allowed:
If you make more than one million dollars a year you should not pay less than thirty percent in taxes… In fact if youre earning a million dollars a year you shouldnt get special tax subsidies or deductions."
But guess what those of you among the servile class. Obama unsurprisingly doesnt practice the same class warfare that he preaches.
In the most recent year available Obamas income totaled $1795614. So unlike Americans earning as little as $200000 whom he habitually defines as millionaires and billionaires" he actually is one. But what did Obama himself pay in taxes? Approximately $454000 which amounts to about 25 of his income.
As for deductions that he says millionaires shouldnt get Obama certainly took his share. In fact he claimed almost $400000 worth which is almost as much as his total tax payment.
But hey at least Obama carries his fair share" better than that miserly Mitt Romney right?
Not necessarily.
Amid the curious media feeding frenzy over Romneys 15 effective tax rate - curious" because the same media refrained from obsessing over John Kerrys 13.1 rate in 2004 - the fact that his investment income is double taxed was ignored. Namely before dividend or capital gain income is taxed at the current 15 rate those dollars are first taxed under our current tax regime at the prevailing 35 corporate rate.
Accordingly since the federal government first taxes such income at the 35 corporate rate and then again upon receipt at 15 the top marginal rate actually reaches 44.75.
Making matters worse Americas 35 corporate tax rate remains the second-highest in the world among developed countries. Not only does that punish investment in the double-taxation manner described above it significantly disadvantages U.S.-based companies vis--vis foreign competitors. When we last reformed our tax system 25 years ago our corporate rate was actually among the lowest in the industrialized world. Since that date however we have fallen to next-to-worst.
Moreover businesses and millionaires and billionaires" arent the only ones suffering under excessive corporate tax rate.
According to Ernst & Young Americas high corporate rate reduced wages and benefits for U.S. employees by some $100-$200 billion over the past decade alone. And according to the Heritage Foundation and Milken Institute reducing that rate even to the Organization of Economic Cooperation and Development (OECD) average of 25 would create 500000 to 2.2 million jobs and add $2484 in additional income for the average family of four each year.
Fortunately there is some good news to report from Obamas State of the Union. Amid his assault he actually suggested a willingness to pursue corporate tax reform:
We should start with our tax code. Right now companies get tax breaks for moving jobs and profits overseas. Meanwhile companies that choose to stay in America get hit with one of the highest tax rates in the world. It makes no sense and everyone knows it. So lets change it."
Americans agree. According to Gallup Americans favor corporate tax reform that would help stem the outflow of businesses and jobs by an 82 to 15 margin.
The question now is whether we act quickly while a rare political consensus exists.
More divisive rhetoric and class warfare from Obama wont accomplish anything. He has exposed himself as a hypocrite by not conducting his own affairs in the manner that he demands from the rest of America but he can make amends by converting his more positive words to action.
Its up to us to ensure that Congress and the White House make this happen to achieve a rare convergence between their own political interests and the nations actual welfare.
