The Motley Fool Discussion Boards
Retirement Discussions / FIRE Wannabees
|Subject: Re: What percentage of gross?||Date: 1/5/2004 7:33 PM|
|Author: synchronicity||Number: 1708 of 5139|
<< So you personally gave them abouy $0.07. So what? Given the choice between this and and a lot of the other crappy places our lovely senators (both Dem and Rep.) choose to spend money our money (hmmm, $25,000 to Native Americans, $87,000,000,000 to Iraq) I'm sorry they didn't get $50,000. >>
It is not the magnitude, it is the principle. Do not tell me that it's only 7¢ when it is MY 7¢ taken against my will. Besides, this was also one example out of thousands of totally wasted giveaways that have NO legitimate basis.
I'm not throwing this in here to be political, and I agree that you have every right to be upset with the principle of the matter on this giveaway. However, I just want to point out the true magnitude of the issue.
Using 2003 numbers (as per FRED), and projecting for all of 2003 from the first 3 quarters of '03 (I know this is 25K in '04, but that should make little difference for terms of this estimate).
The federal government had total expenditures in 2003 of an estimated 2,252,067,000,000 (that's just over 2.2 trillion) dollars.
You use a rough estimate of 42% in savings, and say you spend "more on taxes" than on yourself. Realizing that you're talking rough numbers, and with no idea how much you actually earn or pay in taxes but trying to guesstimate anyway, let's say you spend...oh, 32% of your total income in taxes (leaving you with 26% left). Florida doesn't have any personal income taxes. Florida's sales tax rate appears to be about 6%, but you don't spend much on yourself and I doubt all of your spending is subject to sales tax. Let's just say 1% for sales tax, 31% on fed income and FICA.
Depending on deductions and all that, that would equal a federal tax liability of roughly 130K. I really don't care if your actual tax liability is half that or double that, as you'll see below it doesn't make much difference, I'm just throwing the number out for purposes of this example.
130K divided by 2.252 trillion, times $25,000, equals…roughly 14 hundredths of a cent. Not seven cents, but one seventh of a cent.
Even worse, federal receipts in 2003 are estimated at 1.837 trillion dollars, or about 81.6% of total expenditures. Multiply that by 1/7 of a cent, and you wind up with 1/9 of a cent.
Now, I agree that are probably thousands of giveaways like the one you referenced, and I'm not going to try and defend a single one of them. But how many are there? Ten thousand? Fifty thousand?
Fifty thousand such giveaways would equal fifty eight bucks and change out of a 130K income tax bill.
You're right, there's lots of…er, questionable federal expenditures. But it's the big ones that we really have to focus on. Even if you eliminated every one of these little things, and there were fifty thousand of them, it would barely make a dent in the overall tax burden.
But again, that doesn't mean you can't (or shouldn't) be upset about these items. Heck, the hypothetical fifty eight bucks above is still 58 bucks.
|Copyright 1996-2017 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us|