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She sits down do your taxes he takes -- deductions and exclusions and at the end of the day she pays an -- effective federal tax rate of 16%.
And that is a web video from the Obama administration touting.
The president's proposal for a millionaire's tax that he says will allow.
Regular old Americans to pay -- tax rate more fair and get their fair share out of the rich folks.
But does that match up with reality this is power play welcome back -- -- -- very exciting day for me here to Jim because if Jim Angle.
-- -- Washington correspondent.
And a guy who knows a lot of stuff.
About the way politicians deceive you've been caller Monica for a long time so we're we're grateful you make a minute -- -- thank you.
Thank you this is -- particularly interesting one because obviously the president's -- -- be running for the rest of the year on tax fairness but that is abundantly clear.
In order to make that case it is not just the so called Buffett rule that's all sorts stout and that's that millionaire's tax what I wanna raise tax popular thirty presented the minimum taxed 30% for -- for now one of the problems of course when you get into these things is that.
They cherry pick the examples in order to make it look worse than it is if you look at the average what they did in this web video.
This again all the details.
But they also picked the 400 richest people in the country right right to compare them to someone making fifty grand a year right.
The the fairest comparison if you take average tax rates -- the rich -- in fact pay about 30% so.
But let's just look at what happened here so you heard this.
That presentation about the woman who makes 49800.
Single mom right pays his he said in the -- of -- -- -- you just saw a 60% accurate.
That's -- and then he shows another couple that make -- 103000 a cop and a nurse and he says that their tax rate is.
90% than you do the pediatrician -- -- making a 173000.
-- tax rate he says is 23%.
-- all of this is to show you that they pay pretty you know reasonably high tax -- And that the wealthy the really wealthy coming in like at 18% of -- so they're missing under there yet they're showing you that regular folks pay high taxes.
Well the problem is.
That number didn't look right so -- so we looked into it and one reason it didn't look right is because we know.
That forty to 50% of all taxpayers of modest incomes.
Pay zero federal income tax did you know that -- so how is it this and one making 498 would be paying 60% tax -- -- -- well we looked into it and we got somebody who knows -- a much bigger -- -- that I.
And then dep policy in former head of the Congressional Budget Office.
And he looked at all of the presentation all the examples given by the White House and there was video on that white board and did his own white board take -- -- Yeah particular program.
And executive system we didn't come up with 16%.
We got 7%.
And we looked at the teacher on the comp we couldn't get nineteen we got 10%.
And finally when we got our doctor.
And if you'll notice that looks like tax fairness 7101618.
More -- you have higher tax -- So why -- was -- so bad on different win win -- -- -- -- -- -- by the way loses CBO director.
And house should we describe and he's he's a Republican and what about it is either Republican budget analyst yeah he's he's been active in Republican causes for years.
But he is is former has CBO.
He's got a numbers guy he's got some clout obviously a numbers -- Alka.
Now so what happens is how is it possible that the White House could have an entirely different set of numbers from from what difficulty Hussein.
It's because the White House without saying so.
They made -- -- you're talking -- income taxes but they also included social security and Medicare taxes.
Now it is true as payroll tax at your payroll tax records that comes -- -- your check along with your income taxes.
Now it is true that people pay their taxes senator Sheldon White -- -- -- before the other day.
But you know most people pay this -- is true.
The problem is the the legitimacy of including that an NA and that at a valuation of income taxes is that.
The payroll taxes you get back.
Not only do you get back you get back many times more than you actually put -- end Social Security there's an account with your mind and Medicare you get -- -- -- how long you live you get many many many times that so essentially you're putting money ends in order to get a benefit back in the benefit is way bigger.
You're putting and a hundred dollars you may get it you don't think Kevin is getting a check for 400 right.
So this is not like income taxes so to include that if you're gonna include that critics say.
Then why not also include a boxing shows you how much you're gonna get back in a benefit -- just to make a fair.
If you're not gonna do that that it is not fair to include that because that is a benefit you were going to get back.
And it's unlike income taxes and it skews the entire thing that's what the White House did to make it look worse than we've been -- we've been talking here for a.
Weeks a lot I doubt.
And it I believe it's the tax fairness generates from the Brookings institute in the urban institute -- the Brookings Institution the urban institute put together this tremendous resource to talk about who pays what taxes.
And when you start breaking it down and looking hat and they do -- -- tile as we've been talking about it you're this -- the 20%.
And -- of income in America so the bottom to about 40% -- nothing.
Or get something.
If you have correct is if you had if you're in the lowest 20% of earners.
You get for free a refund that isn't a refund of five crew of about 5% of your income on average -- The effective federal tax rate -- for the people on the bubble that the president's talking about -- timeout is less than 3% for -- real income tax rate.
Correct correct and what you're talking about is what -- order call refundable tax credits so if you made basically make it 101000 dollars -- -- you're not gonna pay any tax.
But you qualify for say a child tax credit or something like that and so the government -- you send you a check.
That's what's known in federal terms as refundable.
Tax critical meeting didn't pay any thing the end so -- getting back what you've -- in -- getting money sent to you.
As a check.
And that happens -- quite a few people and you're right the tax rate -- a look at the Tax Foundation.
Which has a lot of tables about tech and you know if you look by income.
-- we do have a quite progressive taxes there.
Tax system that problem -- some people play less than people know less you know that happens at middle incomes and it happens behind -- That's how it goes Jim and I hope you'll come back again some -- minutes and whack a few more -- -- as -- as well it gets to see some daylight if that's what Texans are good for they cannot stop down at that time we thank you Internet we.
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