Skin in the game
I was surprised to read in the NY Times that 47 percent of Americans don’t pay federal income tax. I checked the Canadian data and 37 percent of Canadians with income don’t pay federal income tax here. The argument is that Americans pay higher payroll taxes (regardless of income level) which is true but Canada has the HST which hits everyone although there are HST rebates for lower income folks.
The Times editorial was outraged at the comment by a Republican presidential candidate suggesting that everyone should have ‘skin in the game’.
I haven’t really given this much thought. It is interesting that a higher percentage of Canadians pay federal income tax.
I do like the idea that people fortunate enough to earn higher incomes should pay a higher rate. As someone who studies this stuff, I have looked at data that suggests very high income taxes on persons with higher incomes will lead them to to try more to avoid taxes. We have talked in the past of incorporated vs. unincorporated small businesses as one way to do this.
I like the idea of skin in the game but I like the idea of a society where those with lower incomes are not forced to pay a lot of taxes.