Taxes get personal
In a fit of frustration (as a result of getting the last of my tax documents), I decided to calculate the real cash money impact taxes have on my life. Now, I am not rich but I’m not poor either. I joke with the wife that we’re affluent. We’re definitely middle class.
The actual percentage of household income that I pay in taxes is (hold your breath): 37.7%. In other words, me and my wife spend roughly 4 months and 15 days of our work year slaving for the man. More than 1/3 of our time! I included in my analysis the following taxes:
*Federal taxes
*Property taxes
*Gasoline Tax
*Sin Taxes
*Professional Privilege tax
*Payroll taxes
*Vehicle Registration
*Sales tax
*FCC Taxes
*Real Estate Fees
*Pet fees
*Gun carry permit fees
Some folks are gonna tell me that some of those things aren’t taxes, they’re fees. And let me spell it out for you, a fee charged by a governmental agency is a tax. Period. The sad thing is, I’m sure I left some stuff out. I know I’ve forgotten some things that slipped my mind and some things that are just too difficult to calculate. For example, I’m not paying taxes on my 401(k), Roth, and some other investment type things yet. The taxes are deferred to a future date and any good accountant will tell that there is a cost to that deferral in the current year (namely, I have no access to the money). So the impact is actually a bit higher.
Ok. Now we know what I pay. What benefits do I receive? Here’s a list:
*I don’t currently speak Russian.
*I use the roads.
*Trash pick up.
*I have a high school education (but that was paid for by prior tax payers and I’m not counting undergraduate and graduate work because I paid for that).
That’s really all I can think of. The American Revolution was fought over a 10% tax (this is where you chime in and say No, it was fought over taxation without representation and I tell you that if the amount had been smaller there probably wouldn’t have been a war, but I digress).
I think the Taxpayer Bill of Rights, advocated by Bill Hobbs, is a grand idea. I also think that the Taxpayer Bill of Rights should be encouraged at the Federal level. It is ridiculous that I pay as much as I do in taxes. Maybe it’s the greedy capitalist in me, but the system is confiscatory, arbitrary, and inefficient.
I think the first step in reducing citizens’ tax burdens is increased efficiency in government. The government needs an agency that performs audits that evaluate efficiency and cost effectiveness, and not merely compliance (the GAO and OIG don’t cut it in this area). Such an agency would limit the government spending say $900 on a hammer or cease requiring two civil service employees with a certain job code to be the only ones authorized to change light bulbs. In addition, such an agency should be charged with holding decision makers accountable to tax payers.
I realize that the creation of this agency appears to go against my typical less government is better stance but upon the creation of this agency, the GAO and OIG should either be incorporated into it or eliminated.
January 27th, 2004 at 2:28 pm
Uncle:
My nit here is that you don’t include your undergraduate and graduate work in your education benefits. Did you go to a private school or state college? If the latter, then your college education was at least partially subsidized by the state.
Let’s also not forget that you support our ongoing actions in Iraq, at a cost of hundreds of millions of dollars per day. That money’s gotta come from somewhere.
About the only ways you could significantly alter the tax load in this country would be:
I hope you see that either of these moves would be disastrous.
January 27th, 2004 at 10:43 pm
Did you count your payroll tax as 12.4% instead of 6.2%? Keep in mind that the employer has to pay 1/2 of it, which comes directly out of their costs of employment (just ask any H.R. professional). You’ve inspired me to calculate my effective tax rate… in addition to those you listed, we pay property tax on CARS, 5.5% state income tax, fire district taxes, 38.4 cents per gallon for gasoline (last I looked), and my home property tax is 4 times that of my mother’s house in Knoxville, at the same assessed value. You should thank God you live in Tennessee, and not the Northeast.
February 16th, 2004 at 1:02 pm
I am new to the internet and I did a search in the search engines on a “real estate blog” and I found your web blog. Let me introduce myself, I am a Halifax Real Estate Agent in Nova Scotia, Canada and I was told that blogs were discussions on specific topics which made me interested in searching for a real estate blog. It seemed like an interesting way to see what trends and technology are happening in the real estate market in other parts of the world besides Halifax. I am considering a blog for myself if I can understand the technology of operating a blog and from what I see I am somewhat hesitant right now even though it was interesting reading.
Respectfully yours
James B. ,
A Halifax Real Estate Agent