Like the slaves in the movie Spartacus who claimed they were all Kirk Douglas, the women in the commercial all begin by saying “I am Warren Buffett’s secretary.”
One lady in particular – we’ll call her Ms. Spartacus – caught my attention. Here’s what she said
I am Warren Buffett’s secretary. I make $40,000 a year and support three children. I shouldn’t pay taxes at a higher rate than millionaires and billionaires.
I did a quick tax return for this lady using refile.com’s tax calculator and I came up with a tax liability of $1,553. Then I did a few calculations:
Taxes as a Percentage of Gross Income:
We simply divide the tax liability by the gross income as follows:
1,553/40,000 = .039%
Ms. Spartacus tax rate as a percentage of gross income is less than one half of one percent 4%.
Taxes as a Percentage of Taxable Income:
First, we calculate taxable income:
40,000 gross income LESS 5,000 standard deduction LESS $12,800 (4 dependency exemptions x 3,200 each) = $22,200.
Then we calculate the effective tax rate:
1,552/22,200 = 6.99%
Ms. Spartacus pays taxes at a rate of less than four percentage points of her gross income. Read that again. Less than 4%.
And her effective tax rate – after the government gives her $17,800 worth of deductions and dependency exemptions – is less than 7.0%.
Even Warren Buffett wouldn’t claim that his tax rate is this low. Of course, we can’t know for sure because he hasn’t produced his tax return.
In any case, even assuming that Mr. Buffett pays taxes at the lower capital gains rate of 15% on all of his income – a very big assumption – his effective tax rate is still twice what hers is.
Where is Marcus Crassus when you need him?
¹ MoveOn.org serially distorts the facts and tells outright lies in order to further its progressive agenda. Here‘s another example. These Alinskyites will do and say anything to further their anti-capitalist, anti-Republican, anti-business agenda.
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