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Vanishing millionaires…and tax revenue

Earlier this month, the IRS released tax data for the 2009 calendar year. The information is far from encouraging, and, goes a long way to explaining why President Obama is now seeking to increase taxes on the thousandaires.

In 2007, we had 18,394 tax filers who reported adjusted gross incomes of over $10 million, and they paid $111 billion in taxes.  By 2009, that figure had dropped to 8,274 filers paying $54 billion.

In 2007, we had 390,000 tax filers who reported adjusted gross incomes of over $1 million, and they paid $309 billion in taxes.  By 2009, that figure had dropped to 237,000 filers paying $178 billion.

This is not a good trend, particularly given our current debt and deficits.

However, even the thousandaires are vanishing.  In 2007, we had 4,536,000 filers reporting more than $200,000 in adjusted gross income, but, by 2009, that figure dropped to 3,924,000, causing tax revenues to fall from $610 billion to $434 billion.

These these figures may delight those on the left who firmly believe there is a fixed “income pie”…i.e., if the rich are earning less, then the non-rich must be earning more. But, since almost 50% of Americans are paying no taxes at all, if this myth be true, and, I can assure you it isn’t, we are losing tax revenue…$364 billion, to be exact, between 2007 and 2009.

As Steve has pointed out countless times, taxing the “rich” will never balance our country’s budget.  Right now, our problem in this regard is far more fundamental.

It’s the economy.

We need income tax payers, and far more “rich” ones then we currently have.  No amount of food stamps, or unemployment insurance, or payroll tax cuts will get us there.  This administration has to get out of the way…stop the regulatory uncertainty, stop the “tax the rich” uncertainty, and let business grow.

Anyone think that will be part of the President’s “soon to be released” plan?

 

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25 Responses to "Vanishing millionaires…and tax revenue"

  1. Lucinda says:

    Very interesting. 
     
    Remember in late 2008, when it seemed that everyone on the left was screaming about the exorbitant pay and bonuses being paid to CEOs and other high ranking executives, and how they demanded lower pay and elimination of bonuses?
     
    Hah. Those unintended consequences will get you every time.

  2. ricbee says:

     They’ll get the same couple of G’s from me.same as usual-my taxes couldn’t buy one bomb for Saddam,as I wrote on my check in 2003. Bill Gates gave away 1/2 his dough so he’ll only pay for a fleet of drones. Who’s gonna come up with $500,000,000 for India’s solar power.

  3. steve418r says:

    The problem is aren’t many out there that understand this. The mantra “tax the rich” is resonating throughout the tax taker community. They see it as a solution to their problems. 

  4. Plainvillian says:

    “The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.”  Winston Churchill

    Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery.” Winston Chruchill

  5. Dimsdale says:

    First, they took away the billionaires, and I said nothing, because I was not a billionaire.
     
    Then they came for the millionaires, and I said nothing, because I was not a millionaire.
     
    Then they came for the “hundred thousandaires”, and I said nothing, because I was not a hundred thousandaire.
     
    Then they came for me, and there was no one left to speak for me.

  6. sammy22 says:

    Also, not taxing the rich will never balance our country’s budget.

    • Anybody but Obama says:

      Nice turn of words there,
      How about having the  51% who pay no taxes kick in a little so that those making a little money don’t need to pull as hard.

      • Dimsdale says:

        True: a small contribution from a huge base adds up, not to mention putting “skin in the game” for them.

  7. Dimsdale says:

    Surely you jest, SOS!!  Warren Buffet says that millionaires and billionaires like himself are champing at the bit to pay more taxes!!!
     
    Of course, they don’t seem to want to do it voluntarily…

  8. sammy22 says:

    No, the billionaires/millionaires are not chomping at the bit to pay more taxes. All they want to do is to create jobs with all the money they have.

    • Dimsdale says:

      But they absolutely won’t be creating any jobs if they are chased out of any given state or the country…

      • crystal4 says:

        Yeah, cause those super tax cuts for the wealthy realllly created jobs!

      • Dimsdale says:

        A lot more than the so called stimulus that Øbama keeps trying.
         
        Isn’t insanity defined as doing the same thing, over and over, and expecting different (in this case positive) results?

  9. Lynn says:

    Cut the government and it’s insatiable appetite. The jobs and revenue will fill the void. Simple physics. My 7th grade physics teacher, Mr. Delegan would be so proud and surprised I learned anything from him.

  10. NH-Jim says:

    I know this saying gets tired: “I have never gotten a job from a poor person.”  If gov’t confiscates the wealth of the successful, the risk-takers, the business-creators, there will be no revenue to create one single job.  Government cannot create self-sustaining jobs.  Stimulus bill created short-term jobs until the unnecessary “beautification” projects were complete and then what?  Nothing.  Money borrowed, money spent: no return.  While a productive business that is allowed to keep its money hires people for long term.
    The wealthy, top 1% paid more in taxes 38.8% federal income tax) after the Bush tax cuts even though their share of the comprehensive income rose only 0.3%.

  11. sammy22 says:

    Yea, they pay taxes. But where are the jobs they are supposed to be creating? Oh, wait, I think I can hear a disclaimer coming….the government is in the way.

  12. Lynn says:

    Correct, Sammy. YOU WIN!!!!!

    • crystal4 says:

      Tired old righty talking point.
      Per CBO:  “tax cuts for high earners would have the smallest “bang for the buck,” because wealthy Americans were more likely to save their money than spend it.”

      • Dimsdale says:

        That’s silly: they don’t stay rich or get richer by hiding their money in “Unca Scrooge’s money bin”.

  13. kateinmaine says:

    actually, the wealthy are more likely to ‘invest’ their money.  investment gives companies more discretionary capital to apply to development and expansion creating what?  oh yeah– jobs.   but to stay on point, doesn’t this reinforce that tired old righty talking point: when the wealthy prosper, so do the lowly.  when the wealthy suffer, it sucks not to be wealthy.

  14. crystal4 says:

    Keep talkin…
    “The tax cuts did not spur investment. Job growth in the George W. Bush years was one-seventh that of the Clinton years. Nixon and Ford did better than Bush on jobs.” And not only did the cuts result in fewer jobs, but also in lower pay.
    http://economistsview.typepad.com/economistsview/2010/09/so-how-did-the-bush-tax-cuts-work-out-for-the-economy.html

    • kateinmaine says:

      and have you analyzed improved efficiencies, which also eliminate jobs?  seriously–learn something about how at least one business runs before you link yourself as an expert. . .

    • Dimsdale says:

      They why, crystal, did Øbama keep them?

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