A politician lying is certainly nothing new, but when President Obama throws out a whopper as big as this one we can’t help but point out the fact that it’s a blatant lie. As our graph below clearly illustrates, no cop or teacher making $50k pays an effective tax rate higher than Mitt Romney’s 14.1%. And, one of the few deductions you get to claim on TOP of the standard deduction (which according to the IRS roughly 70% of people use) just happens to be educator expenses which means a teacher making $50k pays an even lower rate than illustrated in our graph.
Mr. President, please stop lying about Mitt Romney's effective tax rates.
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Adding in payroll taxes pushes the single $50k earner over 14.1%.
Payroll taxes aren’t what’s being discussed though. For example, do you know how much if any payroll taxes Romney paid?
We’d have to run the data on what adding payroll taxes into the mix would do to overall stats. Although frankly, the President isn’t making that distinction. He’s claiming Romney is paying a lower rate and rarely if ever adds the necessary qualifier of EFFECTIVE tax rates. This promotes the idea that somehow Romney is paying a lower tax rate than you or I do.
Unfortunately, that’s just not accurate. We all pay the exact same capital gains rate and any portion of Romney’s income that is not capital gains is taxed at the applicable rate (which is more than likely not lower than yours or mine).
@Ben, Romney declared no wages, salary, tips, etc. so he paid zero in payroll taxes.
@Mark, actually number for the single taxpayer is low. Payroll taxes are 5.65% on the first $108.600 (Social Security and Medicare) and 1.45% (Medicare only) on all wages above that.
So for a single person earning $50k the effective tax rate including payroll taxes would be $18.1%
For the family of four in the example the rate would be 11.9% (still below Romney’s effective rate)
Obama was only saying Romney thinks it’s fair that he should pay a lower tax rate. He wasn’t saying Romney does pay a lower tax rate.
Nice website and idea guys.
Nobody likes paying taxes, or high costs, but taxes make the government go. Unless you don’t want any government at all, taxes are a necessary evil.
A key element is not the penny to penny comparison of tax rates of a guy having an income of possibly $13 million plus a year or $21 million plus a year (as with Romney) and a person earning $50,000/year but what you are left with after those taxes.
When you are making $13 or $21 million you do have lots of money left over. You can do lots with it. For instance build an elevator for your cars. Just think if the tax rate on the rich guy was lower, maybe he would spend some more on his cars, like getting them a butler or an elevator operator.
The $50,000/year person has no such luck. He/she the family is on a tight budget. They have limited funds for anythng extra. If a catastrophe occurs they are in financial dire straits. If some kinds of consumer costs go up they are in dire straits.
The $50,000/year person pays extraordinarily high rate of taxes, relative to their income for payroll taxes and sales taxes for example. The rich guy has payroll taxes capped at a little more than $100,000/per year. That means that at $13 million/year or $21/million year of income….payroll taxes take no bite out of his income.
cripes at that level the guy can build two elevators for his car. Meanwhile the person with a $50,000/year income has to watch every penny.
The person with the $13 or $21 million income feels his federal tax rate should be lowered by 20%. I guess he wants another elevator for the cars. Meanwhile lowering the federal tax rate on the person with the $50,000 income might be an extra meatball for dinner…if it doesn’t go to pay off a few dollars of debt.
Meanwhile the federal deficit soars, while the guy with the $13 or $21 million income tells people he will specifically lower tax revenues for everyone including guys like him with automobile elevators.
Meanwhile he promises to not lower overall tax revenues implying an eagerness to control the deficit, but he won’t be specific about a single solitary method for doing so. Of course 10’s of millions of homeowners would scream about eliminating their home ownership, interest tax writeoffs, let alone the entire real estate and building industries tying up congress and making it a virtual imposssibility….let alone any other kind of offset the rich guy with the auto elevator might suggest.
Lots of promises, no substance. I guess when your cars have an elevator you can say anything you want.
Mr. Right Wing graph user:
If you are married and earn $50,000 your fed income tax rate is 15%. Higher than Romney’s 14.1% effective tax rate. Most people earning $50,000, married with a family might have some various forms of deductions available to them…but nothing in the Romney class. After all Romney’s income puts him way way way higher than the highest marginal tax rate of 35%. yet the guy pays an effective rate of 14.1%.
HOW?
His effective tax rate down to 14.1% was slashed 60% below the normal 35% rate at which people in his income bracket might pay…before deductions and “tax sweetheart deals” for the wealthy. He used that extra money to build an elevator for his cars.!!!!!
Cops and teachers would find it very difficult to slash their effective tax rates that much!!!! Most everyone would find it difficult to slash their effective tax rates that much. The only way to do that is with a mandated sweetheart deal for wealthy people provided by their friends and benefactors in congress.
Nice use of graphs…but very deceptive!!!!!!!