Mike Shedlock

Counting transfer payments such as foods stamps, Medicaid, Medicare, and other government welfare, Congressional Budget Office (CBO) analysis shows the top 40% pay 106% of all taxes (more than all of them). In turn the bottom 60% get money back.

Please consider The rich do not pay the most taxes, they pay ALL the taxes by CNBC reporter Jane Wells.

Buried inside a Congressional Budget Office report this week was this nugget: when it comes to individual income taxes, the top 40 percent of wage earners in America pay 106 percent of the taxes. The bottom 40 percent...pay negative 9 percent.

The key table is in Box 1 on PDF page 11 (report page 7) of Distribution of Household Income and Taxes. The report was released in December 2013 but data is for 2010.

Highlighting is mine.



Key Facts

  • The bottom 20% had average income of $8,100 but received $22,700 in annual assistance, netting $30,800 in after-tax income.
  • The second quintile had average income of $30,700 but received $15,200 in annual assistance, netting $43,400 in after-tax income.
  • The middle quintile received a bit more than they paid out, with $2,600 in annual assistance to be precise.


That money had to come from somewhere, and it did.

  • The highest quintile paid $52,500 more in taxes each year than they got back.
  • The second-highest quintile paid $8,800 more in taxes each than they got back.

Mike Shedlock

Mike Shedlock is a registered investment advisor representative for Sitka Pacific Capital Management.