Government will get half your paycheck next year
No, that's not just if you're "rich" or make over $250 large; even middle class taxpayers are going to fork over almost half their income to government. A middle class taxpayer's income is subject to a 25% federal income tax rate. Then there is social security and Medicare payroll tax of 13.3%; yes I know the employer pays 7.65% but think about it, the employee might actually make more money if the employer didn't have to pay that tax so the employee is getting short shrift. Right off the bat you are paying 38.3% in taxes.
Let's get to state taxes, which are rarely discussed these days. According to the Tax Foundation the average state income tax rate for the middle class is 4.82%. We've now broken the 40% barrier by a bunch, bringing the potential tax burden to 43.12% in federal and state taxes alone. With Congress not having the backbone to act, middle income earners will see their base rate rise in January 2013 from 25% to 28% and the payroll taxes will increase from 13.3 to 15.3%. In January, if Obama is re-elected and Congress refuses to act, you will pay 48.12% in state and federal taxes. We haven't even begun to add in sales tax obligations or fees or penalties and we're already watching half our income slip away before we get to use the money.
Yes, I know the actual income taxes paid by individuals is less due to deductions and credits but many politicians want to take those away, we've already documented efforts to get rid of the mortgage interest deduction, bring back the marriage penalty and eliminate the child tax credit. No, this analysis doesn't consider the taxes coming with Obamacare either. Folks, we are watching Europe collapse upon itself because of the largesse of the government and the high tax rates; yet we are headed in the same direction with a purpose. It's not just Obama, I've said it before and I'll say it again, the rest of the bums have to go as well. Almost anyone elected to office before 2010 is part of the problem. Their absence will be part of the solution.