How Do Tax Brackets Actually Work?

How Do Tax Brackets Actually Work?


There are a few topics that are considered
off-limits at my family’s Thanksgiving table, and one of them is TAXES, or more specifically,
the American tax SYSTEM. Virtually everyone has a strong opinion about
it: It’s unfair! It doesn’t go far enough! It’s too complicated! Cable news and social media are filled with
passionate debates about it, but how many people actually know how our current tax system
works? If your eyes glaze over when you hear phrases
like “progressive taxation” and “marginal brackets,” you’re not alone. Even some of our law-makers seem to have a
shaky grip on the concept. But if you hope to have a say in a system
that impacts your wallet every day, you should understand how—and why—it ended up this
way. Let’s start with something all of us can
agree on. The U.S. tax code is complicated. Really complicated. It’s one of the most complicated systems
in the world, taking the average citizen 13 hours to file each year. Compare that to, say, Japan, where it’s
closer to 15 minutes. And one reason we have such a confusing system
is because our income is taxed at different rates, depending on how much we earn. For nearly 100 years, our country had no income
tax. The first one was levied in 1861 during the
civil war at a flat 3% tax on income over $800.The next year, in 1862, the first “progressive
tax bracket” appeared, with the 3% rate AND a 5% rate for any income earned over $10,000. Then in 1872, the income tax was repealed
because — get this — the government no longer needed the money. Can you even imagine…? Then in 1913 with the 16th Amendment, progressive
taxes made a permanent come-back. It gave the Federal government the free reign
to tax workers’ income in every state. So what is a “progressive tax”? Well, you can think of tax systems coming
in one of three main flavors. Regressive, Proportional, or Progressive. A regressive tax impacts lower paid workers
more severely. Paying sales tax on groceries or clothing
will end up being a higher portion of a low-earner’s pay check than a high-earner. A worker earning $20,000 a year who pays $1,000
in sales tax will be parting with 5% of his income. Another making $100,000 paying that same tax
for the same goods will only be charged 1% of her income for the same thing. A simpler solution would be a proportional
tax, where, simply put, everybody pays the same percentage of their income, no matter
how much they make. Nine states currently impose a proportional, flat state income tax. That means no matter how much you make, your
tax rate stays the same. For example, 5% of every dollar earned. Finally there’s the progressive tax, a system
that has a heavier impact on high earners. Low earners may end up paying little or nothing,
with only the wealthiest people paying the highest tax rates. How does this actually work? Through a series of different tax levels or
“marginal tax brackets”. Buckle up, it’s about to get exciting! Let’s say you’re a single person making
$60,000/yr. A quick look at the IRS Tax Brackets will
tell you that you fall into the 22% bracket. Do you have to give the government 22% of
your income? No! A common misconception is that entering a
higher tax bracket means your whole income is taxed at the higher rate. So how much are you actually paying? After taking your available deductions, you’re
left with $47,800 in “Taxable income”. As of 2019 we have 7 marginal tax brackets
between 10 and 37%. Each bracket along the way applies to one
specific chunk of your income, not the whole thing. Bracket 1 is for your first $9,525, and it
gets taxed at 10%. Next stop is Bracket 2. This applies to $29,175, and is taxed at a
rate of 12%. Last stop is Bracket 3, where your remaining
income of $9,100 will be taxed at 22%. Even though you’re in the 22% tax bracket,
your “effective tax rate” is only 10%, thanks to the marginal rates in our progressive
tax system. So a single-filer with a taxable income of
$500,001 may be in the highest tax-bracket of 37%, but only $1.00 is taxed at that rate. The effective rate will be much lower. This system is definitely more complicated
than a flat-tax. But is it fair? Simply put; no. A progressive tax system, by definition is
unfair. It allows lower earners to pay very little
tax… In fact more than 44% of Americans pay no
federal income taxes. And the more money you make, the less of it
you will keep. Opponents of progressive taxation tend to
be higher earners, arguing that the system “punishes” wealthy people, and actively
discourages making a higher income. They claim that a flat-tax would be simpler,
easier, and more fair. Supporters of a progressive tax, however,
point to the real-world human impact on struggling families and low wage earners. They argue that if people have a greater ability
to pay, then they should pay more. And a progressive tax system, they claim,
can counteract the regressive nature of sales taxes, easing the impact of taxes on your
rent or groceries, while hitting you harder in your ability to take vacations or buy luxury
goods. And while nobody loves paying taxes, the average
US tax-payer actually pays less than almost any other developed nation. Compared to, say Belgium, we get off pretty
easy. Their lowest tax-bracket is 25%, and the highest
is 50% for anything over 38,080 Euros! Do you feel our progressive tax-system encourages
laziness? Does it discourage people from earning more
money? Or is it giving a leg-up to people with lower
salaries? Whatever your opinion, now that you understand
the mechanics of marginal brackets and progressive taxation, you’ll be in a much better place
to argue about it over your next Thanksgiving dinner. Or in the comments section. And that’s our two cents! Thanks to our patrons for keeping Two Cents financially healthy. Click the link the description if you’d like to support us on Patreon. I’m sure you have an opinion about our current
tax system, go ahead and put it in the comments, or you could share it with your elected representative!

100 Comments

  1. Lola Cole says:

    I thought taxes started only on businesses.

  2. Hououin Kyouma says:

    Your Belgium reference was slightly on the nose – they also have socialised medicine and better standard of living then most people in the US so…

    There is a good reason to pay higher taxes. The government may take more, but you also, hopefully, get more in return.

  3. Hououin Kyouma says:

    Most other "western" countries have tax brackets. The US system is just overly complicated for no real reason. It takes about 30 minutes to do Australian tax returns if not complicated and only a few deductions as the whole form is populated for you. It doesn't have to be hard, the US just chooses to let the free market decide, which has made it more complicated. Tax systems and returns shouldn't be left up to companies who sell programs to make it easier or accountants who charge you, it's a serious conflict of interest.

  4. Vitaliy Yavtukhovskyi says:

    How is progressive tax unfair to high earners?? In your own example a person on $60k a year pays 10.74% tax which is practically the same as a person on $9,525 would pay (10%)! If anything, it benefits the high earners because their remaining 90% are A LOT more than 90% of someone who's in the bottom bracket (under $9,525). If anything these tax brackets for the high earners are not high enough…

  5. big c pimp daddy says:

    A porn video of this two

  6. NickyG says:

    I think the issue comes down also to where this income tax money goes. For instance, if the government funnels income tax money back into the public sector such as in education and transportation, then one could make the case for a flat rate as although it hurts less well off people in the short run, they get that money back through government services that rich people may not always use, ex; bus services. Without naming names, spending tax payer money to squabble about archaic and misogynistic policies is part of the problem why people prefer progressive tax rates. Just let me get by and feed myself and do the bickering with the rich people's money

  7. Harukeyn says:

    3:40 what do you mean with avaible deduction?

  8. Talented Toy Reviews says:

    I don't think that anything will cause people for earning more money.

  9. Mummster12 says:

    Lower Michigan has a proportional, flat state income tax but not Northern Michigan?

  10. damnthatsprettygood says:

    Here in the UK, your taxes are already done for you by your employer!

  11. muinaiset says:

    Woohoo! I don't have a strong opinion but I want to boost your youtube metrics! Woo! Love you guys!

  12. Molten Lava says:

    In India, No income tax upto ₹5,00,000 ($7000)

    Income above that is taxable at 10%, 20%, 30% & 35% slabs

  13. Asthildur Thorgilsdóttir says:

    Hi I don't wanna be rude but can you do more for people not from us video ? Takk 🇮🇸

  14. mrseaweed1000 says:

    I’m Irish, so I’ll stay out of the American debate… But here, we only have 2 brackets. 20% on the first €35,000 and 40% on everything above.

    I’m earning just above 35k, so while it does suck to have nearly half of any pay increase gone in taxes, I’m fully aware of the growing problem of income inequality so I’m kinda understanding & accepting of it 🤷‍♂️

  15. Jack Rodarte says:

    Anyone that thinks a progressive tax system doesnt go far enough, is either ignorant to how it works or mathematically ignorant.

  16. James B says:

    In the government's point of view, it is probably less about being fair and more about how much they can squeeze out of every tax payer without upsetting them.
    That said, it is true USA tax rate for middle class income earners are lower than most (if not all) developed countries.
    It is also true that the filling tax, at least for me, is a very lengthy process. Takes me a few weekends to complete.
    I'm sure you're gonna cover this soon. Tax deduction. USA has many good areas to deduct tax, it is actually very friendly to wealthy people or should I say people in pursuit to be wealthy.

  17. BioFercho García says:

    Haha I live in a developing country with a higher income taxation tab US and without brackets, so in theory I should pay more than you. However here we don't have rule of law, so didn't pay anything hahahaha

  18. Average Joe on Money says:

    GREAT VIDEO GUYS | Yes, our tax system is complicated, but that’s partly due to the government wanting to push or incentivize certain types of activities such as rental properties, self-employed businesses, depreciating assets, etc. BUT we do end up taxing higher earners a lot more than we tax lower-income earners when factoring in deductions. VERY SIMPLE AND GOOD EXPLANATION! 😎👍🏻

  19. KUPOKutakPoly says:

    Simplicity is the best considering how Japan does its taxes.

    I wish there is a reverse tax filing like Japan where the government just sends your income tax like a bill on which you can claim deductions accordingly rather than going through accountants and making various checks and balances yourself to be checked by govt who already have all the relevant details.

    I can be wrong so please correct me.

  20. Geckopower says:

    I would be for a percentage flat tax if it wasnt for the fact that politicians from both sides have given special groups ways to avoid huge amounts

  21. Yana S says:

    I still can't believe how many people don't understand the math behind the progressive tax system and sincerely believe that being in certain tax bracket means you'll pay that tax rate on ALL of your income.

  22. Orion Oceanstar says:

    Haveing a better paying job and have more financial secruity is something I'd jump at even if the taxes are higher. Being low income is incredibly stressful. Infact I am working to try to get a better job now. Its so awful having to constantly worry about food,rent,clothes, just basic needs.

  23. Gustavo on the telephone says:

    I love just everything about this channel!

  24. Mark Lewis says:

    The problem isn’t the income tax, it’s corporate taxes. Corporations worth billions of dollars routinely single digit or no taxes each year.

    Absolutely insane.

  25. Reiden Lightman says:

    This is an important video. I hate it when people say "why would I want to be rich if I'm taxed at 70% and I really don't get to keep anything?" Yeah, they have no idea that only a portion of their income would be taxed at the highest rate.

    I support a progressive tax system because, it might not be fair, but it's just. Nobody truly needs more than a 1/4 million dollars per year, do they? Not really. Taxing everything above that at 70% or even 90% doesn't spur laziness. Why would anyone just give up making more when they hit six figures just because they will be taxed slightly more? I'm no psychologist, but I don't see anybody voluntarily making less than $9,000 per year just to be taxed as little as possible. I myself would rather make $100,000 taxed at 50% than $9,000 taxed at 10%. You know why? Because keeping $50,000 is better than keeping $8100, even if I was taxed more.

  26. Manu John says:

    TAX ITSELF IS UNFAIR……………..ASSHOLES…………TAXES ARE THE LARGEST APPROVED SCAM ON EARTH

  27. Seán Patrick Eckmann says:

    If you pay taxes, those 44% who don’t are living on the fruits of your labor.

    Before anyone starts assuming things, I mean you’re being exploited even if you only pay $1. And that’s equally true of the mega corporations who pay nothing but gain benefits from taxes paid by small business.

    Social Security (the great Ponzi scheme that will fun dry well before I retire), corporate welfare (incentives to Amazon who pay $0), Bailouts, abuses of welfare, those working under the table, those feigning disabilities…

  28. Tristin Fleurimond says:

    Please do a video on EITC, there so much to be said about the topic but no clear definition on this

  29. Indio Hatuey says:

    We have a progressive tax rate and stil nobody is trying to earn less. Actually we are the country where people makes more money. A CEO in a Usa corporation makes 100x times the average worker payroll of that corporation. In other countries the CEO's makes less than 20x times the average worker payroll. That's why we have dudes like Jeff Bezos in Amazon with a 150 billions in personal wealth or Facebook, or Microsoft,Koch Brothers, etc. We have probably the most wealthiest people in the world.

  30. JB Robinson says:

    From watching the video, I know which system you prefer. You didn't do a good job of presenting the "regressive" tax system. You should invite someone who supports it to give it equal time to the "progressive" system.

  31. Brian M says:

    This subject needs to be series on its own

  32. Thibau Van Roy says:

    R.I.P Belgium

  33. majjin says:

    Taxation is coercion

  34. Andrew Macdonald says:

    I may say that while the system has high income earners pay more than their lower income counterparts, they don't seem to be suffering much what with all those expensive luxury/performance vehicles, yachts, jewelry, exotic vacations and mansions they continue to buy up. Yeah, they got cash to spare alright….after taxes and pay tax professionals to help squrrel-away the rest of their surplus income in off-shore shelters.

  35. Alpharoth says:

    Oh my god….someone told the truth….I'm amazed right now…no spin….no BS….wow….good job!

  36. Wizdomtrek says:

    Warren Buffets secretary would be pleased to know Amerika has a Progressive (as opposed to a REGRESSIVE) Tax System! Same for Jeff Bezos/Amazon!

  37. chocolatechick729 says:

    I love love LOVE your videos. You guys are my favorite channel. 💱💲💸💰

  38. DavidAWA says:

    I was in Greece during part of their crisis, their sales tax was something like 24% or 26% and tax on food was 18%

  39. Samuel Orozco says:

    “After taking your available deductions” (min 3:40)…what do you mean by that? 🤔

  40. werdwerdus says:

    taxation is extortion

  41. Jose DuBois says:

    I don't think it encourages laziness but I think it's wrong to expect half the country to pay for the other half. If you pay nothing you care nothing and you should have no say in how things are run.

  42. Chris says:

    The rich don't pay taxes. They just create a company and filter all their money through that. They buy things in the company name to make it look like they're breaking even each year. In reality, they're just acquiring assets with any leftover cash to make themselves even richer rather than giving it to the government. Even still though you pay a much higher rate of tax as an employee than you do as a business owner or investor.

  43. Tomasz Konstanty Maluszycki says:

    That Belgian tax… you forgot to include commune tax in it xD in Brussels that is another 8%.

    To be fair Belgium is extreme example of taxation…

  44. Jenny Roman says:

    I actually don’t pick up extra shifts because of how much more I’m taxed on that extra income

  45. Jonathan Duenas says:

    & the left wants to tax wealthy people more? Lol. Then no one will want to put the work in to be wealthy because it will be taken away anyways!

  46. Sahil Hassan says:

    Can you guys please do a video on credit card billing cycles, and advice on how you would use a credit card responsibly in general.

  47. Edwin G.A. says:

    That’s why I’m in favor of flat out rate. I’m current am making a couple of thousands of dollars, and if my blog keeps going the rate that it is I can easily about hundreds of thousands of dollars, but in doing so I will take a hit due to the progressive tax rate. I personally dislike AOC 70% rate for over $10,000. Most millionaire work their asses off and I don’t think it’s fair for people who took risk and now have a better life. I feel the mentality of taxing the rich more makes lower earned feel entitle and complain instead of climbing out of poverty. And I’m not even a Republican before people start commenting. I’m actually a Democrat and I can’t stand “Democratic Socialist” like AOC, or Sanders.

  48. MJA says:

    Honestly, all I want is for my tax dollars to stop funding wars and killing people overseas. I would rather they go towards education and protecting the environment.

  49. Lesbian Amazon Sister says:

    Thank you for explaining how it actually works!

  50. Dee B says:

    Progressive taxation is definitely the best way to go. Now, we have to get the ultra wealthy that uses the loop holes to commit tax evasion. Now that is unfair to the wealthy people paying high taxes.

  51. leadfoot9x says:

    I have mixed feelings about this video. On the one hand, it really does seem like almost everyone in the U.S. somehow misunderstands what a marginal tax bracket actually is, so it's really important to debunk that misconception. On the other hand, it's a fairly simple concept to grasp, and you could still file your tax return in 15 minutes if that were the only complication. The real fun starts when you start talking about deductions, credits, different classes of income, what options you even have to file, etc.

    And Trump was musing last week about indexing capital gains to inflation. What a regressive, system-complicating tax cut that would've been!

  52. Dallas Hoisington says:

    Fun Fact, taxation is theft.

  53. Aaron Landry says:

    How about we abolish our current system and just do a simple flat tax? 5% will hurt you just as much if you make $35,000 a year or you make $350,000 a year.

  54. Rob Landauer says:

    Everyone else: "x% on the wealthiest y% is fair/too much/not enough!"
    Me: "Are politicians so stupid they can't write a continuous function? Why do they need to use brackets?"

  55. Jeremy Villalobos says:

    What is the best way to prepare for a recession ?

  56. Michael Ricks-Aherne says:

    I fucking love you guys. And that's my 2c.

  57. RyuuTenno says:

    I've never been particularly fond of the progressional tax brackets, due to the fact that taxes have a tendency to throw off your math quite a bit, and, at least on the federal level, if you mess up on it, the IRS will drop by.

    Now, I've never had the IRS show up, but, I also work in a company that pulls the taxes out first. But the multiple brackets, I feel, are simply problematic due to the many things that any group/person must attempt to keep track of.

    My thought is that we have the flat, proportional tax rate. Keep this at 10%, regardless of whether it's a person, company, etc. This would allow the government to get a ton of money (potentially more so than they're getting now if done right), and keeps everyone from being horribly overwhelmed with tax math.

    If necessary, of course, dropping it entirely below a certain amount would be quite beneficial as well.
    The idea is that, the government will be able to get $100 from the guy who makes $1k in a week, but, be able to make $100m off of a $1b company like Apple, etc.

    People earning more, will still pay more under the proportional tax rate. And, to be perfectly honest, the progressive system is simply punishing people for being successful.

    I mean, it's effectively rewarding those who are unable to significantly add to the economy, but punishing those who succeed, and as a result, it's bringing the entire economy down a lot. Reducing taxes and establishing the proportional system will encourage everyone to want to be extremely successful, and as a result, our economy will flourish and prosper. This in turn would promptly result in everyone becoming even richer/wealthier over time as everyone will be able to keep more of their money to be able to spend it on other things. It's a very beneficial system with, honestly, no drawbacks.

    As for these people and corporations that would build more wealth at the expense of their workers: simply put, those are corrupt. Not all of them will mistreat their workers, and as a result, they'll pay more and help their workers.

  58. Quest to FIRE says:

    Very helpful video! Glad y’all tackled this topic! 👏🏻🔥🔥🔥

  59. Colin Campbell says:

    What I don't about the progressive tax is that its an automatic increase in tax over time when you take into account inflation. All the government has to do is not adjust the brackets.

    Fair point about offsetting the regressive taxes but I would prefer minimisng regressive taxes. I would also prefer a flat tax with UBI over the progressive tax.

  60. Yasemin BAHAR says:

    So I guess you guys are republicans?

  61. JC CE says:

    Boring channel: please don't argue in the comment section
    Two Cents: WE WANT BLOOD AND TEARS

  62. Adri C says:

    There will always be people with lower salaries no matter how much encouragement is given and no matter what we need someone to take those jobs so in a more realistic prospective a progressive taxation is fair because other wise people at lower incomes wouldn’t keep much of their income making them even more dependent on government handouts

  63. lee Roberts says:

    We dont have a progressive tax bracket

  64. Kevin Malenda says:

    The progressive tax system would be easier for Americans if Free File was allowed. The IRS already has the info we have to input every year. So basically all they would have to do is send us a bill to look over and for the tax payer to add any extra deductions and credits for the year. BTW, this system already exists, but Intuit gives a lot of money to Congress in campaign contributions to keep them for voting on it.

  65. Phillip Borbon says:

    other countries like in europe pays more tax but they get benefits such as free education, health, and other things that we as americans pay a lot for. that said that tax here should encourage people to earn more, but at the same time have companies pay there workers better as they get tax cuts.

  66. Ezequiel Renovato says:

    "More than 44% of Americans pay no federal income tax" wait wtfffff

  67. Biblical Thinker 2.0 says:

    Vote for me, not old enough yet but when I am, I'll take the whole income earning Americans at a 2% flat rate, no questions asked.
    👇 Turn this blue if you'll vote for me!!

  68. Marlon Moncrieffe says:

    We would not have this confusing problem if we got rid of income taxes.

    ✊ Abolish the 16th Amendment NOW!

  69. Josh Ebert says:

    Off topic, but you should definitely do a video on financial aid for college. Including the different kinds of loans and work study programs.

  70. Edward Maduena says:

    Where did the 13,200 deduction come from?

  71. Gabriel Maurer says:

    Name one country that ever significantly improved its quality of life when it decided to significantly raise taxes

  72. Jouni Osmala says:

    In Finland the government already knows how much people earn and some of their deductibles, and just sends a paper that gives the percentages to employers so that they can deduce the taxes from the salary. And government automatically fixes the errors later either doling out some back taxes or tax returns. So on average people don't really spend time filing taxes, with our progressive tax system. However the filings of employers do still complicate things.
    My favorite system would be flat tax combined with basic income, if it would be politically stable. The Basic income would replace the welfare programs and tax progression. The basic income and extra taxes for low earners would cancel each other out, while having very simple system would save everyone's time. And having basic income would just eliminate need for bureaucratic work dealing with welfare programs.
    If percentage is the same employer can just give government a fixed percentage of paid salaries and not to worry about anything else. So less unproductive busywork for both taxes and welfare, while people get similar amounts compared today.

  73. Neryssa111 says:

    In my opinion I would rather have a set rate percentage tax. I have middle income parents where they can’t even use their taxes for government programs. We don’t get FASFA, medical care insurance, Tuition Assistance etc. Yet, the government says if I get pregnant and have a lot of children under 24 I can qualify as a independent. I do know people who take advantage of the system. I want to know how I can prepare myself with knowing what is a Tax Credit and Tax Deductible. There are others in saying their are loopholes which I want to learn.

  74. Jeff Timmerberg says:

    You missed what is, in my opinion, the most persuasive argument in favor of progressive taxation. Taxes contribute to the general stability of the government. The wealthy have much more incentive to want a stable government. Consider the millionaire business owner vs the dude making $15 an hour. If the federal government suddenly collapsed, the life of the dude making 30 grand a year ago can't get much worse. The millionaire might lose his business. Put simply the more you have, the more you have go lose and you should therefore pay higher taxes.

  75. TheSnowFoxParty says:

    I'm supposed to bring home 2k bi-weekly but instead I bring home 500+ less than that, that's taxes for yah 🤦🏾‍♀️🤦🏾‍♀️🤦🏾‍♀️🤦🏾‍♀️🤦🏾‍♀️

  76. Narata says:

    I'll pay more taxes if everyone in the US gets free health care. And yes, I know it's not "free" if I'm paying for it in taxes, but I want this.

  77. ded says:

    FOR FUCK SAKE SPOILDER GET DOWN!

    hands you riffle WE GOTTA STORM THE NEXT TRENCH IN 5!

  78. Austin James says:

    Why don’t we just get rid of taxes #libertarion

  79. Tesla Model 3 says:

    It'd be cool if the USA could try a flat tax rate for a 4 year span to see how it goes.

  80. Erick Soto says:

    I don’t understand the regressive and proportional tax explanations? I think they could have been better explained, but good video!

  81. L M says:

    Who thumbs down this? The hell?!

  82. Libertad o muerte says:

    1913? Hmm what a coincidence that was the same year the fed was created
    Yea for sure just a coincidence……..

    END THE FED!

  83. Kati BC says:

    I wish I made enough to pay the highest taxes and still be able to buy everything I want and do everything I want!

  84. Diego Saul Reyna Español says:

    congrats on the baby

  85. sor3999 says:

    Considering the government caters to the wealthy it's perfectly fair they pay more. Benefit to the poor is merely incidental.

  86. Jake Austin says:

    Flat tax and eliminate sales tax. Substitute a sugar tax or maybe even carbon footprint tax for green efforts.

  87. lotusflo12 says:

    Keep the videos coming. Learning a lot 💕

  88. chaplainsunshine says:

    Please address the talking points of the chain letter 'debunking' of tax rates: https://www.forbes.com/sites/anthonynitti/2017/10/31/sarah-huckabee-sanders-misses-the-mark-with-her-bar-analogy-tax-lesson/#7b16069a733e

  89. jamie t says:

    Regressive is very misleading. People that make more, spend more. The woman who makes $100,000 spends a heck of a lot more than the man who makes $20,000. She most likely will pay more on just sales tax than he will on his total tax burden. The real kicker is that if a big earner is spending the same as the low earner, they are living pretty much the same, if you get what I'm saying. Big house, nice car…sure, but he has already paid the extra tax when we purchased them, then he is paying property taxes on all that stuff, so it's not like he is getting a free ride.

  90. LadyPantera57 says:

    The one thing that wasn't mentioned about the countries that have a higher tax rate is that they're often getting more in return for the taxes they pay.

  91. M Detlef says:

    People who make $100K a year do NOT buy the same things as those making $20k.

  92. Rand Dickson says:

    Taxation is theft!

    We fought a war with Britain on this point…

  93. Sean Cannon says:

    Our tax system doesn't just discourage, it traps people in poverty. It makes it difficult to move up the socioeconomic ladder. Throw in things like welfare and other social programs and people end up losing money taking a pay-raise. Flat tax rate encourages growth plain and simple. If we wanted to actually tax the rich, just have a increased sales tax on things over x amount. There aren't many poor people buying yachts. we aren't giving poor people the option to make more money and be able to invest, and therefor make more money, maybe save that 20% they lost in taxes and put it towards something that can decrease long term cost, therefore saving money. I ascribe to the Austrian school of economics, people like Mises and Rothbard got it right. There are so many advantages to decreasing or eliminating income tax, it baffles me that so many people enjoy having their money taken from them, and to be given so little in return.

  94. Joe Macy says:

    I believe that progressive taxation is a good thing. It helps so that poor people who can barely get by aren't as burdened by taxes, but wealthier people who can afford to pay a little more in taxes without causing too much trouble in paying for day-to-day living expenses take more responsibility in paying for the services we receive. I also do not think it discourages people from making more money, as you are still better off with a higher income even if you are taxed more.

  95. Pete says:

    Europeans pay more taxes, but University and health Care is free or very cheap.

  96. Samantha Murphy-Keller says:

    I think the main problem with the United States tax system (that I think most of us can agree on) is that it’s not used correctly by the government to fund public service adequately enough 🤷🏽‍♀️

  97. Kiki Worlali says:

    Why do some CEOs take $1 salaries? Is it to avoid taxes? Not too sure but I think I read somewhere that they (CEOs) take most of their money through dividends and taxes on dividends are low. Kindly shine more light on this for me or better yet make a video on it 😁. Explaining the rational behind the $1 salaried CEO.

  98. David Lam says:

    USA taxes do no matter to the rich since there are legal loopholes in America's tax laws that allow the rich to deposit their income in oversea tax shelters. To be rich and wealthy in this modern world you have to use shady methods of tax evasion and hiding your income. The capital gains tax is a good example where Warren Buffett has a lower tax rate then his secretary that he employs.

  99. Elaine Lloyd _ikyg says:

    How did Amazon pay nothing.

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