Why did Willie Sutton rob banks? "Because that's where the money is."
Why does the government want to tax your IRA and ROTH retirement savings? Because that's where the money is.
When the income tax first went into effect in 1915, the top rate was a mere 7% and fell only on those making $500,000 a year or more -- that's $13.5 million in today's dollars. The vast majority of Americans paid the lowest 1% rate.Today, the federal income tax ranges from 10%-37% and that's on top of all the FICA withholding. Today's top rate -- more than five times higher than it was in 1915 -- falls on those making about $500,000.
Which means top rate-payers are paying 5.5 more income tax on about one-thirtieth of the income.
The lowest rate-payers are paying 10 times more on about the same fraction -- and that still doesn't count FICA deductions, which hit the poorest the hardest.
The income tax was sold by early 20th Century progressives as a way to sock it to the rich, but progressives made sure it become a way to sock it to everybody.
You can bet your bottom dollar -- if Congress doesn't confiscate that, too -- that today's "Billionaire Income Tax" is tomorrow's "Tax Your Middle Class Retirement Accounts Before You Even Retire."
Our government is too big, too unaccountable, too incompetent, and entirely dedicated to growing its own power. Anything that can't go on forever, won't.
