The 400 Highest Earners in the U.S. Pay Only 18.1 Percent in Taxes
Do you subscribe to The New Yorker yet? Why not? Come on.
James B. Stewart has a must-read piece in the March 19th issue entitled “TAX ME IF YOU CAN: The things rich people do to avoid paying up.” Money (cough) quote:
The Internal Revenue Service discloses detailed statistics for the four hundred highest-earning taxpayers in the country. In 2008, the most recent year available, those taxpayers had an average adjusted gross income of two hundred and seventy million dollars each. Thirty of them paid less than ten per cent in federal taxes, and a hundred and one paid between ten and fifteen per cent. On average, the group paid 18.1 per cent.
President Obama has seized on that fact, making tax fairness a central issue in his reëlection bid. The President has called for comprehensive tax reform and for specific proposals for a “Buffett Rule,” which would raise tax rates on taxpayers earning more than a million dollars a year. Romney has called for a twenty-per-cent across-the-board tax cut, while limiting some deductions. ...
None of the proposals address the fact that rich people aren’t taxed on certain income, either because it is exempt, as with interest on municipal bonds, or because they claim to be living outside the jurisdiction that is levying the tax. Relatively scant media attention has been paid to residency requirements, even though enormous revenue is at stake.
So that's what Stewart does: he pays attention to the residency requirements and how the rich can afford to skirt them.
A thumbnail of the piece is available here. It's also on newsstands. You can also borrow my copy if you promise to bring it back. And subscribe.