Am I the only one paying my damn taxes? I’m sorry, are we the only ones paying our damn taxes? I don’t want to sound unpatriotic or un American, but why so much in taxes? The income tax rate this year for people making between $48,601 – $125,450 (I used this category because it is indicative of the earnings of the middle class people that will most likely read this article) equals $6,652.50 +25% of the excess over $48,600 (Forbes.com). So, if you made $75,000 last year, you would have owed the IRS $13,252. That’s crazy! Unfortunately, most of us middle “classers” are working twice the amount of time as we were pre-recession or doing the work of two or more people these days. We are just being flat out overworked and drastically underpaid. For those of us within the sales arena, it has become much harder to make a sale…even when people know that they need the product that we are selling. Too many people are still afraid of losing their jobs and holding on to their money very tightly. On top of that, we pay some of the highest energy prices in the country. Did you know that for every gallon of gas, we pay 48.6¢ in state taxes? And, our personal income tax rate is 10.30% which puts us at number 49 out of a list of 51 states and districts (Hawaii is last on the list and the District of Columbia is counted as well).
If you own a small business, things don’t get much better. Most small businesses are sole proprietors, LLCs, or S corporations in which the income generated is passed on through to the owner. This means that the earnings from the corporations are placed in the earned income section of the owner’s1040 form on their income taxes. Added to this misery, are the additional payroll taxes for 2013. For small business owners with C corporations, California’s corporate tax rate is 8.840 which still places us at number 41 out of the 51 states (including the District of Columbia) in the US. So, even profitable small businesses are seeing more of their income taken away due to taxes. One could argue that the flip side to all of these new taxes would be new infrastructure, schools, and money for the space program (yep, the space program…don’t y’all want to know if there are any aliens out there) and green technology, right? Wrong!
Here’s the thing, not everyone is paying more taxes! Let’s take a look at our big corporations. You know the companies that make your ipad, your laptops, your big screen TVs, cars, etc.
You would think that corporations that make billions of dollars a year would have it much worst, but such is not the case. Which is why I chose this topic for my next two blogs. That’s right! I’m so pissed off at this that I’m going to dedicate my next two blogs to exposing corporate greed because they are not paying their fair share of taxes and our country is suffering as a result. Some of these big corporations are not paying taxes at all, and some are even getting refunds! When I read this, it was a “helluva” slap in the face! Case in point, according to an article entitled Corporate Accountability and the Workplace, written by Paul Bucheit, 280 of the most profitable U.S. Corporations shelter half their profits from taxes, and thirty of these companies paid less than zero in taxes in the last three years. He also stated that the average effective tax rate for all 280 companies in the study over the three year period was 18.5 percent; for the period 2009-2010 (post recession) it was 17.3 percent; less than half the statutory rate of 35 percent. Try earning over $100,000 per year as an employee of one of these corporations and not paying a 35 percent tax rate and see if you don’t find yourself in a cell right next to Wesley Snipes! Here are some other startling facts from the article that will blow you away:
• For over 20 years, from 1987 to 2008, corporations paid an average of 22.5% in federal taxes. Since the recession, this has dropped to 10% — even though their profits have doubled in less than ten years.
• 30 companies enjoyed a negative income tax rate over the entire three year period on their combined pre-tax profits of $160 billion.
• Total tax subsidies given to all 280 profitable corporations amounted to $222.7 billion.
Subsidies? That’s right, subsidies! Walter, you can’t be talking about the same subsidies that are frowned upon once you and I have to rely on food stamps and unemployment whenever one of these big profitable corporations have laid us off or when we collect Medicare once we have become permanently disabled from work related injuries, right? Yes, I’m talking about that kind of subsidy. Oops! I’m sorry, those are called entitlements. There is a difference right? An entitlement is something that people get when they become unemployed or fall on hard times, but a subsidy is something a corporation gets when they have to lay us off due to a “poor economic climate”. You understand the difference right? Right…? Well, if you don’t understand the difference, then you are probably just as smart as me because I don’t understand the difference at all. Stay tuned for Part II of this blog, and I’m going to explain how corporations use legal loop holes to hide what some analyst say is over a trillion ($1,000,000,000,000) dollars in offshore accounts safely away from taxes. Part II will be published on June 14 (blogs are published the 2nd and 4th Friday each month). So, stay tuned and let’s see exactly who is paying that 35%!
Walter Hines,
Financial Editor
ReelUrbanNews.com
“I blog; therefore, I am!”
Twitter Account: @bisonbiz2012
Website: www.bisonbiz.com
Email: walter@bisonbiz.com
