Are We Too Dependent on Rich Taxpayers?
13th December 2010
California’s budget crisis has highlighted one of the most important tax issues of our time: a growing dependence on wealthy taxpayers for government revenue.
In a column in yesterday’s Sacramento Bee, Dan Walters cited the need to reduce “the corrosive dependence on income taxes from a handful of wealthy people by broadening the tax base.”
Good luck with that.
In 2005, the richest 13.5% of California taxpayers (or those earning more than $100,000) paid 83% of all income taxes. Capital gains from the top 5% of taxpayers accounted for $100 billion out of the $111 billion in total capital gains reported.
No shit.
What governments need to do (aside from structural cost cuts, of course) is recognize the boom-and-bust nature of today’s wealthy and save money during the booms so they can spend during the busts. That way they can smooth out the inevitable tax swings.
Good luck with that, too.