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It’s A Myth That 47% Of Americans Pay No Taxes, In Truth 86% Pay Taxes
A favorite talking point used by conservatives to justify giving more tax breaks to the wealthy is that 50% of Americans pay no taxes. The truth is that 86% of Americans pay taxes.
Here is Donald Trump on Fox and Friends this morning via Media Matters claiming that 50% of Americans pay no taxes:
Sean Hannity has also pushed this talking point hard:
The truth is that the talking point that half of all Americans pay no taxes is a misrepresentation. Here is the full quote from the Tax Policy Center,
The fraction of tax units paying no income tax varies widely by filing status and type of unit. About 47 percent of single filers will owe no tax, compared with 38 percent of joint filers and 72 percent of heads of household. More than half of elderly tax units and tax units with children will pay no income tax this year.
The 47% statistic is not all Americans pay no taxes, but single filers who will pay no federal income taxes. According to the Center On Budget and Policy Priorities the real reason why 47%-51% of Americans paid no federal income taxes in 2009 is,
The 51 percent figure is an anomaly that reflects the unique circumstances of 2009, when the recession greatly swelled the number of Americans with low incomes and when temporary tax cuts created by the 2009 Recovery Act — including the “Making Work Pay” tax credit and an exclusion from tax of the first $2,400 in unemployment benefits — were in effect. Together, these developments removed millions of Americans from the federal income tax rolls. Both of these temporary tax measures have since expired.
The combination of the recession and the Obama stimulus cut taxes to low and middle income Americans led to fewer Americans owing federal income tax in 2009.
The Tax Policy Center has tried to correct Fox News and the right wing media’s misuse of their research. In April 2010, Howard Glickman of the TPC wrote,
Let me explain—repeat actually—what this means: About half of taxpayers paid no federal income tax last year. It does not mean they paid no tax at all. Many shelled out Social Security and Medicare payroll taxes. In fact, only 14 percent of Americans didn’t pay either income or payroll taxes. Some paid property taxes and, it is fair to say, just about all of them paid sales taxes of one kind or another. So to say they pay no taxes is flat wrong.
However, this class warfare-like rhetoric plays to a perception that the income tax is a chump tax: Only hard-working folks like us pay it. The welfare queens don’t. The super-rich don’t. It is a powerful emotional argument. It is also flat wrong.
The actual number of Americans who don’t pay any taxes isn’t half, but 14%. This group of non-taxpayers of any kind is largely composed of the elderly and disabled. The people who don’t pay taxes do so because they can’t work.
The myth that the wealthy are carrying the tax burden for America is used to justify tax cuts for the rich. Conservatives use the inaccurate statistic hand in hand with their, “wealthy are the job creators argument.” One statistic that was intended to demonstrate the loss of income due to the recession, along with the impact of the Obama tax cuts has been distorted and misused to justify a policy of not asking the wealthiest Americans to pay their fair share.
The truth is that 86% of Americans pay taxes. In one recession strapped year (2009), less than half of single filer taxpayers paid federal income taxes.
Millions of Americans are not being told the truth that almost 90% of us pay taxes, and that much of the reason why there were fewer people paying federal income taxes in 2009 was that Barack Obama signed the largest tax cut in US history.
Since the truth undercuts the conservative’s reverse Robin Hood steal from the poor to give to the rich policy, they are going to do their best to keep the facts buried under a mountain of misinformation.
Anytime anyone tells you that half of Americans paid no taxes, do your country a favor and straighten them out. We have the facts. It’s time to tear down this talking point.
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25 Responses to It’s A Myth That 47% Of Americans Pay No Taxes, In Truth 86% Pay Taxes
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Reynardine
Jul. 18th, 2011 at 2:50 pm
I’m one of those “lucky duckies” with no taxable income, and if I had an income worth taxing coming in, I’d pay with tears of gratitude. As it is, I pay anyway. I pay on my tiny house and garden and grove. I pay when I feed my watchdog/hunting dog or my grove cats. I pay if I buy underwear, T-shirts, socks, jeans, or sandals. I pay for anything at all that isn’t human food or medicine. If my godson gets me around, I pay when I chip in for gas… and let’s not forget the taxes on electric and water. At that, I am better off than some even luckier duckies, who are sleeping under bridges, but if some of these flattaxers want to be as lucky as us duckies, all they have to do is give away their money and live like we do.
Dusty
Jul. 18th, 2011 at 2:59 pm
In Ohio we pay the following taxes:
Federal Income Tax, State Income Tax, Local Income Tax, Real Estate (Property)Taxes, Sales Tax-which differ from County to County (there is 88 Counties),Personal Property Taxes. Part of our Real Estate Taxes go to the local schools, County nursing home, County school for the disabled, 911 fund. You name in OH- you are taxed for everything your purchase and consume with the exception of Food.
Luckily Ohio does allow a deduction on State Income Taxes for those who have to pay Federal Taxes on Social Security Disability income received. But I am sure John Kasich has his eye on eliminating that deduction soon.
It it can be taxed you can believe Ohio governments at all levels are trying their best to get their piece of the pie.
Shiva (Moderator)
Jul. 18th, 2011 at 3:57 pm
you are luckier than you think. Some states like Virginia pay property tax on where they parked their cars. Or else it’s a property tax on the car itself.
Glaisne
Jul. 18th, 2011 at 3:35 pm
When I hear repugs make this claim I reply isn’t that what you guys want? Aren’t you the guys always bitching and moaning about taxes? Aren’t you guys always clamoring for cutting taxes? You’d think you guys would celebrate about half the people not paying taxes. So what is the problem? Or is it that you only want corporate persons to pay no taxes and only us little people should shoulder the entire burden, right?
Enjay in E MT
Jul. 18th, 2011 at 3:50 pm
So we, the middle class, don’t pay enough in taxes!
My pretty darn good working class wages last year, after deductions for retirement.
Wages $41.664
Federal -5,581. 13.39%
My S/S -3,228. 7.75%
” Medicare -755. 1.81%
MT State -2,119. 5.09%
Taxes paid by payroll $11,683 or 28.4%
less ST & Fed Refund $11,032. or 26.48%
not including employer portion of ss/Medicare
the Vehicle, phone, property, etc.taxes,
fortunately, we do not have a sales tax here
Enjay in E MT
Jul. 18th, 2011 at 4:29 pm
OOOOPS – that $41,664
not $41.664 (like in Million or Billion)
lol – I wish
James Vickers
Jul. 22nd, 2011 at 8:32 pm
Add to that 7.5 percent in payroll taxes your employer pays in your stead, considered by most economists to be part of your salary also.
St James
Jul. 19th, 2011 at 4:04 pm
If your wages had kept up with GDP the median wage in the US would be $92,000 not the $50,200 it stands at now…You’d be earning about $76,360. Think about that for a little while.
TheNightowl
Jul. 18th, 2011 at 3:55 pm
Folks, this is still misleading. The US has a population of about 307 million people. The US Bureau of Labor Statistics estimates that only 153.4 million people are even IN the workforce. I know our senior population is expanding, but half the people in the country DO NOT EVEN WORK. Do you look at a family of four, where Dad has a decent job, mom stays at home, and point to them saying “Only 25% of them pay taxes!” If you want to look at the statistics that way, it’s absolutely valid to say that. Given the numbers of seniors and disabled people on fixed incomes, and low-income people, the case could probably be made that well over 50% of the INDIVIDUALS in this country do not pay federal income taxes. Yet, even the kid buying something at the candy store is probably paying sales taxes.
THEN, it’s a fallacy that people “paying no tax” aren’t working and are a drain on the society. For a married couple with 2 children filing jointly and taking the standard deduction, the first $26,000 of income is exempt from federal income taxes. (Not to mention untaxed health insurance premiums paid through payroll deductions, etc.) Of course, housing prices vary by market, etc., but the US taxpayers are NOT “supporting” these people with housing, food stamps, medical care, etc. And while they may be exempt from federal income taxes, they ARE paying around $1700 annually in social security and medicare TAXES, at a minimum. And not everyone exempt from federal income taxes is exempt from state income taxes. (Ask a state employee from Kansas about paying state income taxes on their un-federally-taxed mandatory deductions to their state retirement fund.)
The entire mstter is far too complex to point at a statistic and say “Half the people pay no income taxes!” It is 100 times more egregious to suggest, as many do, that people with no federal tax liability are being “supported” by other taxpayers. That kind of spin on it is so misleading, in fact, that I call it an out-and-out lie. And I, for one, am sick of hearing it.
Susan
Jul. 21st, 2011 at 11:28 pm
Oh, duh. Little kids don’t pay taxes but are figured into the population count. The lazy little creeps.
Older_Wiser
Jul. 18th, 2011 at 4:02 pm
Well, if those liars want to try living on $12K/yr in SS (on which I pay no tax now, having finally retired from the workplace), let them try. Meanwhile, I do pay taxes of 7-1/2% on every purchase, except food which is taxed at 2%. I pay property taxes as part of my rent, and both federal and state tax on gasoline (which I buy infrequently, thankfully), in addition to telephone tax and additional fees on that and electricity, not to mention “access” charges for the internet. Additionally, I am helping my grandson raise my great-grandchild (we all live together) and since I don’t have to file a return, get no consideration for helping them, either. When he was working earlier this year, my grandson paid around 25% of his low wage check in taxes.
So, yeah, they should go ahead and try living on $12k/yr, and in addition, paying for costs of health care not covered by Medicare, money many of us elders don’t have but have to pay anyway or be refused care.
novenator
Jul. 18th, 2011 at 4:19 pm
The funniest part about the ultracons bitching about this (even when they are not being deliberately deceptive) is that they complain about some folks not paying federal income taxes, then in the next breath defend the right of the super rich and big corporations to pay no tax. Hypocrisy much?
Shiva (Moderator)
Jul. 18th, 2011 at 4:27 pm
I could really care less if the rich are carrying the burden. If the wealthy are the ones that create jobs as the light conservatives say, then where are the jobs? if they are not creating jobs they might as well be paying taxes. And if they don’t want to carry the burden than they should be creating jobs. From where I said it looks to me like the wealthy have no interest in remaining wealthy and making sure that people are working. Because when I am president the offshore taxes are going to choke them like a squid
Enjay in E MT
Jul. 18th, 2011 at 5:45 pm
“if they are not creating jobs they might as well be paying taxes”
Since Ronald Reagan promoted ‘trickle down’ economics – it is mostly urine that has ‘rained’ on us. For the last 30 years,
instead of investing in America – they are purchasing homes in countries with universal health-care, or buying yachts built in Italy (registered in Samoa) while sending manufacturing jobs to China & India.
Cathy
Jul. 18th, 2011 at 5:53 pm
Great article, Jason, but you were being too nice in saying myth, it is a GOP lie! Got some great responses here, too!
Ben
Jul. 19th, 2011 at 3:19 am
There is a misleading line in the article.
“The 47% statistic is not all Americans pay no taxes, but single filers who will pay no federal income taxes. ”
It is true that 47% of single filers pay no federal income tax, but 47% of ALL filers pay no federal income tax. So, the 47% is true in reference to ALL filers, not just single filers.
Jeff Bradford
Jul. 22nd, 2011 at 12:18 am
Actually, Kevin, the commonly repeated statement is that half of Americans pay no INCOME tax, which as you note, is true. As Churchill said, the problem with socialism is that you eventually run out of other people’s money. And when looters & moochers can can vote themselves a living because, thanks to the nanny state, they are in the majority, well, then you rack up nation-killing debt. Sound familiar?
I’ve never understood how socialists think a nation can thrive by demonizing productive people. Please explain how this is a good idea. Please point to examples of successful collectivism. You live in a fantasy my friend. Why not focus on your own productivity instead of wasting your time and energy trying to penalize the people who pay for your welfare state? I think you’d be much happier.
Shiva (Moderator)
Jul. 22nd, 2011 at 12:33 am
And to think it has nothing to do with socialism, but the fact that so many are making so little so that they dont have to pay taxes. They arnt moochers or looters.
Sorry, your using meaningless talking points.
jd_n_sf
Jul. 23rd, 2011 at 12:14 am
Folks who insist on equate paying taxes with socialism shouldn’t be taken seriously.
Get back to us when those job creators start to actually create jobs. Then you can call them productive people. Sitting back and collecting dividends doesn’t cut it.
Tom Bavis
Jul. 27th, 2011 at 4:04 pm
Let’s see… those “looters and moochers” include disabled people who CAN’T work, retirees who are finally getting something back for the 30-40 years they paid INTO the system, people getting minimum wage (which would be over $50 an hour if their wages had kept up with the top 1%…). All of whom would be happy to have enough income to allow them to pay income tax. My father gets a generous pension of $8,800 (before Medicare tax) after 30 years at the same company – without Social Security where would he be?
Ted Vicknair
Jul. 22nd, 2011 at 12:45 am
It’s The Donald that does not pay his fair share of taxes. The Donald has used tax depreciation rules on real estate to depreciate property that, in reality, appreciates over time. This allows him to offset much of the rental income he generates with tax depreciation. When he is ready to get rid of his real estate, its not taxed due to the availability of 1031 exchanges. This is a internal revenue code section that allows one to exchange real estate for other real estate (a like kind exchange) without recognizing an income tax gain, and this is generally not available for exchanges of other assets. Even when he, from time-to-time, is required to recognize a gain for tax purposes, its taxed at federal rates of 15% – long term capital gains rates – rather than the maximum rates of tax on labor of 35% (not including another 15% on wages up to $106,000).
So The Donald’s wealth is a product of preferential governmental intervention in the market via the tax system.
Shiva (Moderator)
Jul. 22nd, 2011 at 1:07 am
The very wealthy do not pay their fair share. Its true the wealthy pay the bulk of the taxes, but their rates in general are less than a man who makes 50,000 per year. SO the claim the rich are carrying us is deceptive
n211
Jul. 29th, 2011 at 1:10 pm
Before I say anything further, let me make it known that I am an Independent, and I think this article and the argument behind it is ridiculous.
Part of the price paid for enjoying the benefits of citizenship in this country is paying taxes. Everybody should pay them, as a precentage of what they earn, with the exception of the destitute. The argument that these 47% pay sales tax and whatever else is absurd. Chinese tourists pay sales tax. If everybody accross the board was affected by having to pay income taxes, maybe we would be more diligent in policing what politicians to with it. Maybe next time someone that represents us in Congress is lobbying for federal money to fund a completely unneeded project, we can say, “Hey, I had to forego some things I needed this year in order to pay my income tax, so why don’t you guys forego some crap we DON’T need and not add to our ENORMOUS national debt?”
While I don’t disagree with the fact that the rich aren’t paying their fare share, I think the fact that HALF OF THE PEOPLE IN THIS COUNTRY don’t pay income tax… is more than enough to prove that there is plenty of blame to go around here.
At the end of the day, I don’t mind paying income, or any other taxes, as long as I KNOW that my money is being put to good use and is not being wasted on nonsense, which most of the time isn’t the case.