Sunday, November 4, 2012

Some rough numbers

I came across an interesting statistic: the government of the U.S. plans to spend 3.8 trillion dollars in 2013 or… $12,000 per person. So a single person who earns $30,000 per year and who spends it all does basically have the lifestyle of someone earning $42,000.  Since 47% of U.S. citizens according to Mitt Romney don’t pay taxes that is $42,000 AFTER (income) tax dollars.
Here are some additional numbers: the 46.5% are 76 million people of whom 723,000 reported income between $75 and $100K; 381,000 earning between $100K and $200K; another 103,000 persons reported income between $200K and a million buckaroos and 7000 people earned above a million. Add this up and we learn that 1.2 million U.S. citizen earn more than $75,000 and pay no taxes out of the 76 million. He… is that the infamous 1%? J
Of the 76 million, 38% make less than the personal tax deduction of $9,350 (per tax payer). I would say, definitely poor. Seniors get extra tax deductions. I will not break this down further. One last number, the medium wage income in the U.S. was $26,364 in 2011.

Thus, a median dual income family with 2 children would make $26,364 x 2 plus 4 x $12,000 in government spending totaling $100,728 per year while paying no taxes. This is what it really would cost to live in the land of the ‘American Dream’.  I bet, in Canada things are not overly different.
In Canada, tax freedom day is around the middle of June. Thus half of our income goes to the tax man. Of course although collectively we pay 50% of our income, close to 40% (or is it 47%?) doesn’t pay income taxes and on average we’re paying 15% of what we’re spending on consumption taxes (which are flat taxes). That would mean that approximately 60% of Canadian workers pay all of Canada's income taxes, their tax freedom day is not In June but probably closer to August. Would you like to be ‘rich’ and work 8 months per year for the government? Is this a progressive tax system or are we already living in a socialist society?

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