Equitable Income Tax Presentation
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![Page 1: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/1.jpg)
Equitable Income Tax
by Dan Nielsen
![Page 2: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/2.jpg)
Statement of Purpose
To inspire more equitable policies which encourage fair incentives and rewards,
job creation and economic development.
![Page 3: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/3.jpg)
• Background
• Proposed Ideas
• Tax Comparison (Current and Proposed)
• Health Care Revenue Plan
• Tax Comparison (Including Health Care)
• Conclusions
Contents
![Page 4: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/4.jpg)
Background
• The US has an increasing wealth disparity and national debt.
• The top 1% earn up to 10,000 times median income and up to 1,000 times the income of doctors and the President.
• The top income tax bracket has been as high as 92% (1951-1952) and as low as 24% (1928).
• The first (bottom) income tax bracket has been as high as 23% (1943-1944) and as low as 0% (1923).
United States Internal Revenue Service and Census Bureau
![Page 5: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/5.jpg)
Chart 1. US debt, debt as % of GDP, first and top tax brackets (1910 – present).
0
10
20
30
40
50
60
70
80
90
100
110
120
130
0
2
4
6
8
10
12
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24
26
1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 2020
Firs
t/To
p T
ax B
rack
ets
(%)
Deb
t as
% o
f G
DP
US
De
bt
($Tr
illio
n)
Year
US Debt ($Trillion)
Debt as % of GDP
Top Tax Bracket (%)
First Tax Bracket (%)
![Page 6: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/6.jpg)
Suggestions Towards Inclusive Capitalism
• Federal income tax of 10% up to median income ($27,500).
• Above median income, federal income tax increases 10% each 500% increase in income and is capped at 49% tax:
Federal income tax = 6.213 • ln(income) + [-6.213 • ln(median income) + 10]
• Combine capital gains and all other sources of revenue as personal income (taxed 10 – 49% as shown above).
• Lower business tax to a flat rate of 20%.
Proposed Ideas
![Page 7: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/7.jpg)
Current and Proposed Tax Comparison
Earned Income Multiple of US Tax Multiple of Proposed Tax Multiple of Proposed
Income Percentile Median Income Federal Median Income Federal Median Income Change
$ % Pre-tax % After Tax % After Tax %
12,300 25 0.45 11.6 0.5 10 0.45 -14
27,500 50 1.0 13.5 1.0 10 1.0 -26
56,100 75 2.0 18.2 1.9 14.4 1.9 -21
138,000 94 5.0 23.4 4.4 20.0 4.5 -14
275,000 98.3 10 27.6 8.4 24.3 8.4 -12
408,000 99.0 15 29.5 12 26.8 12 -9
1,110,000 99.8 40 33.0 31 33.0 30 0
1,660,000 99.9 60 33.7 46 35.5 43 5
2,750,000 99.94 100 34.2 76 38.6 68 13
27,500,000 99.999 1,000 34.9 752 49.0 567 40
275,000,000 >99.9999 10,000 35.0 7,515 49.0 5,667 40
![Page 8: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/8.jpg)
Chart 2. Federal income tax and after tax income for bottom 75% Americans.
0
10,000
20,000
30,000
40,000
50,000
0
5
10
15
20
25
0 40,000
Aft
er T
ax In
com
e (
$)
Fed
eral
Inco
me
Tax
(%)
Adjusted Gross Income ($)
% Income Taxed (Current)
% Income Taxed (Proposed)
After Tax Income (Current)
After Tax Income (Proposed)
ThirdQuarter
(50 - 75%)
Second Quarter
(25 - 50%)
Bottom Quarter(0 - 25%)
56,100 (75% income)
–
12,300 27,500
(25% income)
– –
![Page 9: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/9.jpg)
Chart 3. Federal income tax and after tax income for bottom 99% Americans.
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
0
5
10
15
20
25
30
35
0 150,000 300,000
Aft
er T
ax In
com
e ($
)
Fed
eral
Inco
me
Tax
(%)
Adjusted Gross Income ($)
% Income Taxed (Current)
% Income Taxed (Proposed)
After Tax Income (Current)
After Tax Income (Proposed)
Near Top Quarter (75 - 99%)
Third
Quarter
5
0
I 7
5%
Second
Quarter
2
5I
50%
Bottom
Quarter
0
I25
%
408,000 (99% income)
–
56,100
–
(75% income)
![Page 10: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/10.jpg)
Chart 4. Federal income tax and after tax income for bottom 99.9% Americans.
0
300,000
600,000
900,000
1,200,000
0
10
20
30
40
0 1,660,000
Aft
er T
ax In
com
e (
$)
Fed
eral
Inco
me
Tax
(%)
Adjusted Gross Income ($)
% Income Taxed (Current)
% Income Taxed (Proposed)
After Tax Income (Current)
After Tax Income (Proposed)
99.8% Income
Bo
tt
om
7
5%
Near Top 24.9% (75 - 99.9%)
(99.9% income)1,110,000408,000
– –
(99% income)
![Page 11: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/11.jpg)
Chart 5. Federal income tax and after tax income for bottom 99.999% Americans.
0
3,000,000
6,000,000
9,000,000
12,000,000
15,000,000
18,000,000
0
10
20
30
40
50
60
0 10,000,000 20,000,000
Aft
er T
ax In
com
e ($
)
Fed
eral
Inco
me
Tax
(%)
Adjusted Gross Income ($)
% Income Taxed (Current)
% Income Taxed (Proposed)
After Tax Income (Current)
After Tax Income (Proposed)
99.8% Income
Near Top 0.1% (99.9 - 99.999%)
–
(99.999% income)
1,660,000(99.9% income)
–
![Page 12: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/12.jpg)
Chart 6. Federal income tax and after tax income for bottom 99.9999% Americans.
-30
-20
-10
0
10
20
30
40
50
60
-30
-20
-10
0
10
20
30
40
50
60
1,000 10,000 100,000 1,000,000 10,000,000 100,000,000
% In
cre
ase
Fed
eral
Inco
me
Tax
(%)
Adjusted Gross Income ($)
% Income Taxed (Current)
% Income Taxed (Proposed)
% Increase
99.8% Income
Top Quarter(75 - 99.9999%)
Third
Qua
rter
50
I
75%
Bottom Quarter
(0 - 25%)
Second
Quar
ter
25
I
50%
(99.9999% income)
![Page 13: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/13.jpg)
Health Care Revenue Plan
• All US citizens pay 10% of income for national health care.
• Health care benefits increase with higher health care premiums.
• Eliminate incentives for unnecessary procedures and costs.
• Create incentives for efficiency, cost cutting and preventative health.
• Make US businesses more competitive internationally by removing employee health care costs.
![Page 14: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/14.jpg)
Chart 7. Federal income tax and after tax income for bottom 99.9999% Americans.
0
10
20
30
40
50
60
70
80
90
100
110
0
10
20
30
40
50
60
70
80
90
100
110
1,000 10,000 100,000 1,000,000 10,000,000 100,000,000
% In
cre
ase
Incl
ud
ing
He
alth
Car
e
Fed
eral
Inco
me
Tax
Incl
ud
ing
Hea
lth
Car
e (%
)
Adjusted Gross Income ($)
% Income Taxed (Current)
% Income Taxed (Proposed)
% Increase (Including Health Care)
Top Quarter (75 - 99.9999%)
Thi
rd
Quar
ter
50
I
75
%
Bottom Quarter
(0 - 25%)
Sec
ond
Quar
ter
25
I
5
0%
(99.9999% income)
![Page 15: Equitable Income Tax Presentation](https://reader038.fdocuments.in/reader038/viewer/2022100506/548219c65906b505058b462a/html5/thumbnails/15.jpg)
Conclusions
• Combine capital gains and all other sources of revenue as personal income taxed 10% up to median income, then increasing 10% each 500% increase in income and capped at 49% tax:
Federal income tax = 6.213 • ln(income) + [-6.213 • ln(median income) + 10]
• Create conditions for job growth by removing health care costs and lowering business tax to a flat rate of 20%.
• All US citizens pay 10% of income for national health care.
• A more equitable distribution of wealth will increase consumer demand, worker motivation, innovation, human health and economic growth.
• Increased economic opportunity will minimize crime and welfare.