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Federal Taxes Lowest Since 1950!


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Translation for the mathematically challenged:

 

The following passage from the opening paragraph, tells the whole story

"Actually, as a share of the nation's economy, Uncle Sam's take this year will be the lowest since 1950, when the Korean War was just getting under way."

 

So, what exactly does this mean, Dave?

 

For starters, Federal taxes are not the lowest since 1950, but the share of federal tax receipts as a percent of US GDP is the lowest since 1950. We'll forgive your editorial oversight.

 

Second, since tax rates have not changed since the Evil Bush administration was evicted, there must be another reason for the decline in the government's take. What could it be?

 

Math 101

 

The product of a multiplication depends on the two variables. So kids, if the product is lower than the previous year, but one variable (tax rate) remains constant over the years, what is the most likely cause for the product to be lower?

 

Answer:

 

The GDP is lower.

 

 

Congratulations, you win the Dave in Norfolk Sputnik Moment Prize.

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The bad news is, Dave in Norfolk is back.

 

The good news is, he is probably going back into hiding after reading your post.

I could just see Dave saying to himself after he read the article

 

 

"I got'em, got'em, now what will they say?"

 

then he reads GG's post

 

 

"Oh Crap!"

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Translation for the mathematically challenged:

 

The following passage from the opening paragraph, tells the whole story

 

 

So, what exactly does this mean, Dave?

 

For starters, Federal taxes are not the lowest since 1950, but the share of federal tax receipts as a percent of US GDP is the lowest since 1950. We'll forgive your editorial oversight.

 

Second, since tax rates have not changed since the Evil Bush administration was evicted, there must be another reason for the decline in the government's take. What could it be?

 

Math 101

 

The product of a multiplication depends on the two variables. So kids, if the product is lower than the previous year, but one variable (tax rate) remains constant over the years, what is the most likely cause for the product to be lower?

 

Answer:

 

The GDP is lower.

 

 

Congratulations, you win the Dave in Norfolk Sputnik Moment Prize.

1. you are not looking for a product you are looking for a ratio or a percentage that's what share means and it tells you nothing of what GDP or tax revenues are in absolute values just what there relationship to each other are.

2. Just because the statutory tax rates stayed the same doesn't mean effective tax rates stayed the same.

3. You have a lot of nerve giving a math lesson to anyone.

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So taxes are the lowest they've been since 1950 and we can thank Bush? Awesome job Davey boy! :thumbsup:

But Not Obama....you partisan lacky!

 

1. you are not looking for a product you are looking for a ratio or a percentage that's what share means and it tells you nothing of what GDP or tax revenues are in absolute values just what there relationship to each other are.

2. Just because the statutory tax rates stayed the same doesn't mean effective tax rates stayed the same.

3. You have a lot of nerve giving a math lesson to anyone.

That's for sure! But that's what his spin is all about. And your's also, for that matter! :w00t:

 

Translation for the mathematically challenged:

 

The following passage from the opening paragraph, tells the whole story

 

 

So, what exactly does this mean, Dave?

 

For starters, Federal taxes are not the lowest since 1950, but the share of federal tax receipts as a percent of US GDP is the lowest since 1950. We'll forgive your editorial oversight.

 

Second, since tax rates have not changed since the Evil Bush administration was evicted, there must be another reason for the decline in the government's take. What could it be?

 

Math 101

 

The product of a multiplication depends on the two variables. So kids, if the product is lower than the previous year, but one variable (tax rate) remains constant over the years, what is the most likely cause for the product to be lower?

 

Answer:

 

The GDP is lower.

 

 

Congratulations, you win the Dave in Norfolk Sputnik Moment Prize.

Ya ok, our GDP is lower than in 1950? Ummm...ok. Yet all the GG's horses and all the GG's men fall into line.

 

Wow!

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1. you are not looking for a product you are looking for a ratio or a percentage that's what share means and it tells you nothing of what GDP or tax revenues are in absolute values just what there relationship to each other are.

2. Just because the statutory tax rates stayed the same doesn't mean effective tax rates stayed the same.

3. You have a lot of nerve giving a math lesson to anyone.

 

Let me be clear.

 

I was referring to the revenue portion of that equation, which is derived from the statutory tax rates and gross income. Effective tax rates are meaningless in this discussion because nobody pays taxes based on the effective rate. The effective rate is calculated based on actual money that's been paid into the system. You have no idea of what he effective rate is until you pay the tax.

 

So if statutory rates did not go down, that can only mean that incomes went down. Moreover, if the ratio is the smallest in 60 years means that the incomes went down even faster than GDP declined. Welcome to the "benefits" of progresive taxation.

 

Thanks for the math lesson, btw.

 

That's for sure! But that's what his spin is all about. And your's also, for that matter! :w00t:

 

You should be thanking him like a 5-yr old should thank a crossing guard for helping him cross the street.

 

Ya ok, our GDP is lower than in 1950? Ummm...ok. Yet all the GG's horses and all the GG's men fall into line.

 

Wow!

 

And where exactly did I say that?

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Let me be clear.

 

I was referring to the revenue portion of that equation, which is derived from the statutory tax rates and gross income. Effective tax rates are meaningless in this discussion because nobody pays taxes based on the effective rate. The effective rate is calculated based on actual money that's been paid into the system. You have no idea of what he effective rate is until you pay the tax.

 

So if statutory rates did not go down, that can only mean that incomes went down. Moreover, if the ratio is the smallest in 60 years means that the incomes went down even faster than GDP declined. Welcome to the "benefits" of progresive taxation.

 

1. could also mean deductions went up or ability to defer taxes increased

2. the proportion of GDP generated from different sectors probably changed less from labor income more from corporate profits, dividends, and capital gains

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1. could also mean deductions went up or ability to defer taxes increased

2. the proportion of GDP generated from different sectors probably changed less from labor income more from corporate profits, dividends, and capital gains

 

Which is another way of saying that GDP and income declines contribute to a lower tax take.

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Show me the math!!!

GDP =

1.Wages, salaries, and supplementary labour income

2.Corporate profits

3.Interest and miscellaneous investment income

4.Farmers’ income

5.Income from non-farm unincorporated businesses

 

lets say the economy loss 200,000 jobs which would have provided a total of 10 billion dollars to the GDP at an aggregated 18% effective tax rate = 1.8 billion tax revenue not received.

 

At the same time Exxon increased their corporate profits 20 billion and pay an effective tax rate of 5% = 1 billion tax revenue.

 

GDP increases 10 billion but tax revenues decrease by .8 billion

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