The “Tax Freedom Day” nonsense

by David Safier

Today's Star editorial is right to say the "Tax Freedom Day" idea is too simplistic. But the editorial is wrong about the reason. "Tax Freedom Day" is a bogus statistic, a ruse to make low and middle income people believe they pay more taxes than they actually do.

According to the Tax Foundation, a corporate funded group, April 10 is the day when we stop working to pay our taxes and start working for ourselves. It's one of those seductive, easily grasped ideas. "You mean I've been busting my ass all this time just to pay my taxes?" The problem is, it's a gross oversimplification based on average income and tax burden (Did you know Bill Gates and I have an average net worth of $30 billion?) which exaggerates the amount most of us pay.

Let's say you make $40,000 a year. Here are the taxes you have to pay to make April 10 your "Tax Freedom Day."

• You have to pay $5,200 in state and local income taxes.
• You have to pay $2,000 in sales taxes, which means you spend half your gross income on items charging sales taxes.
• You have to pay $1,600 in property taxes.
• You have to pay $3,000 in Social Security and Medicare taxes.
• And — I saved the best for last — you have to pay $1,300 in corporate income taxes. Really. You have to pay corporate income taxes for the April 10 day to work.

The only accurate estimate in the list for someone with an income of $40,000  or less is for Social Security and Medicare taxes, which take about 7.5% straight off the top of people's paychecks. The other numbers range from dubious to ridiculous.

If you're a member of the working poor, it takes through January, maybe into early February, to work off your payroll taxes, sales tax and, since you probably don't own your home, the amount of your rent that goes toward the landlord's property tax. This is a guesstimate, but I imagine when you hit $70,000 to $80,000 a year with a family, you approach the April 10 date. People with incomes above that should be paying far beyond the April 10 date, unless, of course, they have high paid accountants. In a fairer world, it would take longer for the rich to pay off their taxes than it does, like through May, at least. Go Buffett Rule!

Isn't it amazing these same people who want us to think we all pay so much in taxes also say 50% of Americans don't pay any taxes? They want it both ways. We have to lower taxes — $10 less for you, $10,000,000 less for a hedge fund CEO — because you're spending a third of your life making money for the government. But we have to raise taxes on the working poor because they're not paying their fair share.