How Grossly Unfair The U.S. Tax System Has Become

By Mark Gongloff

Apple CEO Tim Cook waved a magic wand in front of America on Tuesday, vanishing our outrage over how shamelessly companies avoid paying taxes, leaving the rest of us to foot the bill. As a public service to you, here is a chart that should enrage you about corporate tax rates all over again! (Story continues below chart of RAGE.)

Notice the beige stripe that is shrinking steadily? That stripe is the percentage corporate taxes contribute to total federal revenue. And notice the olive-green stripe that has swollen to be larger than the beige stripe used to be? That is the contribution of payroll taxes to federal revenue.

What this shows is how dramatically corporate tax contributions have shrunk in the past several decades, and how our personal taxes have risen to fill the gap. Payroll taxes now make up 35 percent of all federal government tax receipts, up from 11 percent in 1950. Corporate income taxes, meanwhile, now make up less than 10 percent of federal revenue, down from about 26 percent in 1950.

To 'splain those numbers a little more clearly: We who are on the payrolls of companies now bear way more of a tax burden than those companies bore decades ago. Those companies, meanwhile, bear less of a burden than we ever did.

And this doesn't include individual income tax, which accounts for about 46 percent of total federal tax receipts, roughly the same as 60 years ago.

Update: This chart of course does not reflect the fact that employers typically cover half of the payroll taxes collected by the government. Assuming companies pay half of the payroll taxes in this chart, the total tax burden for individual Americans is reduced to about 63 percent of total federal revenue, instead of 81 percent, as I estimated in an earlier version of this story. But that is up from about 45 percent in 1950.

And the total corporate contribution to federal revenue, including employers' share of payroll taxes, has dwindled from 32 percent in 1950 to about 17 percent today. Employer contributions to payroll taxes make the unfairness of the tax code slightly less unfair, but the trend is still clear and dramatic: Corporations are paying a lot less than they used to.

This chart was produced for aSeptember 2012 report (download-y PDF file) about corporate tax avoidance by the Senate Permanent Subcommittee on Investigations. Walter Hickey of Business Insider helpfully republished the chart on Tuesday, in honor of Cook's testimony before the same subcommittee. Update: The Senate lifted the chart directly from an earlier Tax Policy Center report about the sources of government revenue.

Cook was there to techsplain how Apple holding $102 billion of cash offshore isn't really tax avoidance so much as good old fashioned ingenuity. Also, have you forgotten the shiny objects Apple makes (including the dreamy MacBook Air on which this here story was typed)? By the end of the hearing, Sen. Rand Paul (R-Ky.) had demanded that Congress apologize to Apple for the inconvenience, and Sen. John McCain (R-My Lawn) was reduced to gently jibing Cook about how often he has to update his apps.

And Rand Paul is kind of right, you guys, as is Tim Cook: We should not be so mad at Apple for doing what the law allows. We should be mad that the law allows Apple and other companies to keep billions of dollars of cash offshore and out of the government coffers, where it could be helping the unemployed and our crumbling infrastructure and such. Another thing we can get mad about is how the "corporate tax reform" that Cook and other corporate leaders are always banging on about will actually serve tomake it so companies pay even less in taxes than they do now.

Hell: A Division Of The IRS

Hell, the most coveted Division in the IRS . If you desire a meteoric rise in notoriety and status, you are encouraged to apply to Hell and join the cream of the crop. 
[Sayf Maslul]

Tax his land, tax his wage,
Tax his bed in which he lays.
Tax his tractor, tax his mule,
Teach him taxes is the rule.


Tax his cow, tax his goat,
Tax his pants, tax his coat.
Tax his ties, tax his shirts,
Tax his work, tax his dirt.


Tax his chew, tax his smoke,
Teach him taxes are no joke.
Tax his car, tax his ass
Tax the roads he must pass.


Tax his tobacco, tax his drink,
Tax him if he tries to think.
Tax his booze, tax his beers,
If he cries, tax his tears.


Tax his bills, tax his gas,
Tax his notes, tax his cash.
Tax him good and let him know
That after taxes, he has no dough.


If he hollers, tax him more,
Tax him until he's good and sore.
Tax his coffin, tax his grave,
Tax the sod in which he lays.


Put these words upon his tomb,
"Taxes drove me to my doom!"
And when he's gone, we won't relax,
We'll still be after the inheritance TAX!!!


[Author Unknown]

More Than 53% Of Your Tax Payment Goes To The Military

Your Tax Dollars At War

By Dave Lindorff'
April 13, 2010
Courtesy Of "Information Clearing House"

If you’re like me, now that we’re in the week that federal income taxes are due, you are finally starting to collect your records and prepare for the ordeal. Either way, whether you are a procrastinator like me, or have already finished and know how much you have paid to the government, it is a good time to stop and consider how much of your money goes to pay for our bloated and largely useless and pointless military.

The budget for the 2011 fiscal year, which has to be voted by Congress by this Oct. 1, looks to be about $3 trillion, not counting the funds collected for Social Security (since the Vietnam War, the government has included the Social Security Trust Fund in the budget as a way to make the cost of America’s imperial military adventures seem smaller in comparison to the total cost of government). Meanwhile, the military share of the budget works out to about $1.6 trillion.

That figure includes the Pentagon budget request of $717 billion, plus an estimated $200 billion in supplemental funding (called “overseas contingency funding” in euphemistic White House-speak), to fund the wars in Afghanistan and Iraq, some $40 billion or more in “black box” intelligence agency funding, $94 billion in non-DOD military spending (that would include stuff like military activies funded through NASA, military spending by the State Department, etc., miilitary-related activities within the Dept. of Homeland Security, etc.), $123 billion in veterans benefits and health care spending, and $400 billion in interest on debt raised to pay for prior wars and the standing military during peacetime (whatever that is!).

The 2011 military budget, by the way, is the largest in history, not just in actual dollars, but in inflation-adjusted dollars, exceeding even the spending in World War II, when the nation was on an all-out war footing.

This military spending in all its myriad forms works out to represent 53% of total US federal spending.

It’s also a military budget that is rising at a faster pace than any other part of the budget (with the possible exception of bailing out crooked Wall Street financial firms and their managers). For the past decade, and continuing under the present administration, military budgets have been rising at a 9% annual clip, making health care inflation look tiny by comparison.

US military spending isn’t just half of the US budget, though. It is also half of the entire global spending on war and weaponry. In 2009, according to the venerable War Resisters League, US military spending accounted for 47% of all money spent globally on war, weapons and military preparedness (it's probably closer to 50% now). What makes that staggering figure particularly ridiculous is that America’s allies--countries like France, Britain, Germany, Italy, and Japan--account for another 21% of the world’s military spending. Fully 12 of the top-spenders among big military-spending nations are either allies of the US, or are friendly or completely non-threatening countries like Brazil and India. That is to say, America and its friends and allies account for more than two-thirds of all military spending worldwide.

China, in contrast, probably the closest thing to a real “threat” to American interests because of America’s treaty commitments to the island nation of Taiwan, and China’s counter claim that the island is a part of the PRC, spends only some $130 billion on its military, much of which is actually devoted to maintaining military control over the country’s own 1.3 billion people, some of whom might prefer to be independent, or to be freer, if they weren't under the military jack-boot.

The next biggest military spender, Russia, spends less than $80 billion a year on its decrepit military--about one-twentieth of what the US spends--and isn’t even technically an enemy of the America anymore. Its military is largely busy keeping restive regions from spinning off from the mother country, anyhow.

Meanwhile Iran, which the White House and Congress are portraying as America’s arch enemy, despite its not having invaded another country in hundreds of years, isn’t even on the list of the top 17 military big-spenders. Iran’s current military budget is a teensy $4.8 billion (no surprise since its economy is about equal to Finland's), about the same as the estimated $5 billion spent on the military by North Korea--America’s other “major enemy.” Each of those country’s military budgets is about one-quarter of the military budget of Australia. Combined, they add up to about two thirds of the military budget of the Netherlands.

Just to give one an idea of how small $4.8 billion is in comparison to the $1.6 trillion that the US is spending each year on war and planning for war, that number is roughly what the Pentagon plans to spend over the next year on childcare and youth programs, morale and recreation programs and commissaries on its bases! It’s about what the Pentagon will spend acquiring replacement Seahawk, Chinook and Blackhawk helicopters this year.

For the average American, what all this means is that of every dollar you send to the IRS, 53 cents will be going to pay for blowing stuff up, fattening the wallets of colonels admirals and generals, bloating the portfolios of investors in military industries, and of course funding the bonuses paid to executives of those companies, and the campaign chests and private expense accounts of the members of Congress who vote for these outlandish budgets. Your money will also be going to pay for the salaries and the bullets of those brave heroes over in Afghanistan who are executing kids, killing pregnant women (and then digging out the bullets and claiming they were stabbed by their families), and for the anti-personnel weapons that are creating legions of legless Afghani kids.

Next time you hear that the government needs to cut funds for providing medical care to the children of laid-off workers, or that supplemental unemployment funds are running out, next time you hear that federal funds that are needed to fund extra teachers at your school are being cut, or that Social Security benefits need to be cut back, or the retirement age needs to be increased to 70, next time you hear that your local post office has to be shut down for lack of funds, next time you hear that Medicare benefits need to be reduced, think about that 53% of your tax payment that is going to finance the most enormous war machine the world has ever known.

And ask yourself: Is this really necessary? Is this really where I want my money going? Is this really even making me safer or my country stronger?

Award-winning investigative reporter Dave Lindorff has been working as a journalist for 37 years. A regular columnist for CounterPunch, he also writes for Extra! and Salon magazine, as well as for Businessweek, The Nation and Treasury&Risk Magazine. Visit his website http://www.thiscantbehappening.net/