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US Taxes Explained
dheffley
Member Posts: 25,000 ✭
Over lunch two friends were discussing the government's recent round of tax
cuts:
"I'm opposed to those tax cuts," the retired college instructor declared,
"because they benefit the rich. The rich get much more money back than
ordinary taxpayers like you and me and that's not fair."
"But the rich pay more in the first place," the businessman argued, "so it
stands to reason that they'd get more money back." He could tell that his
friend was unimpressed by this meager argument.
Even college instructors are a prisoner of the myth that the "rich" somehow
get a free ride in America. Nothing could be further from the truth.
Let's put tax cuts in terms everyone can understand.
Suppose that every day ten men go to a restaurant for dinner. The bill for
all ten comes to $100. If it was paid the way we pay our taxes, the first
four men would pay nothing; the fifth would pay $1; the sixth would pay $3;
the seventh $7; the eighth $12; the ninth $18. The tenth man (the richest)
would pay $59.
The ten men ate dinner in the restaurant every day and seemed quite happy
with the arrangement until the owner threw them a curve.
"Since you're all such good customers, he said, I'm going to reduce the cost
of your daily meal by $20." Now dinner for the 10 only costs $80.
The first four are unaffected; they still eat for free. Can you figure out
how to divvy up the $20 savings among the remaining six so that everyone
gets his fair share?
The men realize that $20 divided by 6 is $3.33, but if they subtract that
from everybody's share, then the fifth man and the sixth man would end up
being paid to eat their meal.
The restaurant owner proceeded to work out the amounts each should pay under
the same assumptions:
Now the fifth man also paid nothing, the sixth pitched in $2, the seventh
paid $5, the eighth paid $9, and the ninth paid $12 leaving the tenth man
with a bill of $52 instead of $59.
Outside the restaurant, the men began to compare their savings. "I only got
a dollar out the $20," complained the sixth man, pointing to the tenth, "and
he got $7!"
"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too.
It's unfair that he got seven times more than me!"
"That's true," shouted the seventh man. "Why should he get $7 back when I
got only $2? The wealthy get all the breaks!"
"Wait a minute," yelled the first four men in unison."We didn't get anything
at all. The system exploits the poor."
The nine men surrounded the tenth and beat him up. The next night he didn't
show up for dinner, so the nine sat down and ate without him. But when it
came time to pay the bill, they discovered something important. They were
$52 short!
And that, boys, girls, and college instructors, is how America's tax system
works. The people who pay the highest taxes get the most benefit from a tax
reduction. Tax them too much, attack them for being wealthy, and they just
may not show up at the table any more. After all, there are lots of good
restaurants in Switzerland and the Caribbean!
Save, research, then buy the best.Join the NRA, NOW!Teach them young, teach them safe, teach them forever, but most of all, teach them to VOTE!
cuts:
"I'm opposed to those tax cuts," the retired college instructor declared,
"because they benefit the rich. The rich get much more money back than
ordinary taxpayers like you and me and that's not fair."
"But the rich pay more in the first place," the businessman argued, "so it
stands to reason that they'd get more money back." He could tell that his
friend was unimpressed by this meager argument.
Even college instructors are a prisoner of the myth that the "rich" somehow
get a free ride in America. Nothing could be further from the truth.
Let's put tax cuts in terms everyone can understand.
Suppose that every day ten men go to a restaurant for dinner. The bill for
all ten comes to $100. If it was paid the way we pay our taxes, the first
four men would pay nothing; the fifth would pay $1; the sixth would pay $3;
the seventh $7; the eighth $12; the ninth $18. The tenth man (the richest)
would pay $59.
The ten men ate dinner in the restaurant every day and seemed quite happy
with the arrangement until the owner threw them a curve.
"Since you're all such good customers, he said, I'm going to reduce the cost
of your daily meal by $20." Now dinner for the 10 only costs $80.
The first four are unaffected; they still eat for free. Can you figure out
how to divvy up the $20 savings among the remaining six so that everyone
gets his fair share?
The men realize that $20 divided by 6 is $3.33, but if they subtract that
from everybody's share, then the fifth man and the sixth man would end up
being paid to eat their meal.
The restaurant owner proceeded to work out the amounts each should pay under
the same assumptions:
Now the fifth man also paid nothing, the sixth pitched in $2, the seventh
paid $5, the eighth paid $9, and the ninth paid $12 leaving the tenth man
with a bill of $52 instead of $59.
Outside the restaurant, the men began to compare their savings. "I only got
a dollar out the $20," complained the sixth man, pointing to the tenth, "and
he got $7!"
"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too.
It's unfair that he got seven times more than me!"
"That's true," shouted the seventh man. "Why should he get $7 back when I
got only $2? The wealthy get all the breaks!"
"Wait a minute," yelled the first four men in unison."We didn't get anything
at all. The system exploits the poor."
The nine men surrounded the tenth and beat him up. The next night he didn't
show up for dinner, so the nine sat down and ate without him. But when it
came time to pay the bill, they discovered something important. They were
$52 short!
And that, boys, girls, and college instructors, is how America's tax system
works. The people who pay the highest taxes get the most benefit from a tax
reduction. Tax them too much, attack them for being wealthy, and they just
may not show up at the table any more. After all, there are lots of good
restaurants in Switzerland and the Caribbean!
Save, research, then buy the best.Join the NRA, NOW!Teach them young, teach them safe, teach them forever, but most of all, teach them to VOTE!
Comments
SMILE...MAKE EM WONDER WHAT YOUR UP TO
If everyone paid a flat 10%- the government could swim in our money and have enough left over to party every night.!
And before you ask, yes, I pay a large amount of taxes (over $20k a year), and it sucks. But I'd certainly feel different about it if I was making $50 (or $500) million a year. At that salary, WHO CARES? If you can't get by on that much........then you just plain suck.
The REASON that the "rich guy" is taxed so heavily is because he got that money on the sweat of others (yes, I do the same......part of owning a business.)
Merc
NO! You may not have my guns! Now go crawl back into your hole!
****************************************
"Tolerating things you may not necessarily like is part of being free" - Larry Flynt
I might not always tell you the truth, but I will never lie to you!
Edited by - The firearms consultant on 08/16/2002 15:31:27
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