Laura Tyson Just Sent You a $5000 Tax Bill

Lost amid the hubbub over the second stimulus package hinted at by Laura Tyson, was how the US was going to pay for it. Tyson smoothly intimated that if the US could raise revenues, then paying for the stimulus would not be a problem. Her exact quote from the WSJ:

If the government could get a way to get to Canada’s intake, the debt and deficit problem would go away. In five years, we would go from deficit to surplus.

This is political speak for a tax increase. We thought it may be enlightening to look at the numbers.

Canadian revenue is 33.3% of GDP, while the US takes in 28.3% of GDP. The following chart is from the OECD.

Tax Revenue as a % of GDP (Click to enlarge)

Assuming the US GDP remains at about $14 trillion the tax increase would be $700 billion.

Calculation

Canadian Revenue as a % of GDP33.3%

- US Revenue as a% of GDP28.3%

Increase 5%

5% * $14 trillion = $700 billion

According to the IRS there are approximately 138 million taxpayers in the US. Dividing the $700 billion by 138 million we find that Laura Tyson just raised your taxes by $5072.46 per year.

Disclosures: none

Comments

[manya05:]

You wish, she will not divide by 138 million taxpayers.

Jul 09 08:15 AM

[Fairness:]

If that would also mean free health care for everyone and pensions you can retire on, let's do it; otherwise is just plain highway robbery...

Jul 09 09:11 AM

[Suncatcher:]

As I read it that is basically the amount of increase needed to service the already existing committments. It does nothing to pay down the principle or fund anything going forward. LOL


On Jul 09 09:11 AM Fairness wrote:

> If that would also mean free health care for everyone and pensions
> you can retire on, let's do it; otherwise is just plain highway robbery...

Jul 09 10:36 AM

[SivBum:]

The plan is to raise tax rate for those with above $200K AGI to help pay for military/infrastructure costs to protect their vacation trips overseas or travels between their McMansions.

Jul 09 11:29 AM

[DownOnMyLuck:]

So, if you pay $5,000 more in taxes, you get free health care?


On Jul 09 09:11 AM Fairness wrote:

> If that would also mean free health care for everyone and pensions
> you can retire on, let's do it; otherwise is just plain highway robbery...

Jul 09 01:00 PM

[Fairness:]

Canada does... ???
Why can't OUR representatives spend OUR tax money on us, the taxpayers, to ensure we get the basics that we really need?

On Jul 09 01:00 PM DownOnMyLuck wrote:

> So, if you pay $5,000 more in taxes, you get free health care?<br/>

Jul 09 01:34 PM

[DownOnMyLuck:]

Why do you need, or want, the government to provide your needs, and probably wants? I would rather choose where to spend my $5,000 instead of having a representative choose where to spend it, after taking a huge cut for themselves, of course. I am shocked, shocked, at how many Americans are willing to give up their freedom and money for some false promises made by slick-talking politicians. Sadly, the US is no longer the land of the free and home of the brave.


On Jul 09 01:34 PM Fairness wrote:

> Canada does... ???
> Why can't OUR representatives spend OUR tax money on us, the taxpayers,
> to ensure we get the basics that we really need?
>

Jul 09 01:55 PM

[TeresaE:]

Our taxable GDP is nowhere close to $14 trillion, since GDP is made up from government (and thus, not taxed) spending.

So, it would end up being a much larger increase to make up the difference. Much larger.

Good news, the absolute wonderful economy is creating millions more people that make over $200k and already have health care.

So, they can afford it.

Regretfully, the rest of us won't be able to buy their products once the tax rolls downhill.

Which, will reduce their taxable income, and paid income tax, creating another hole.

Apparently the only solution to overspending is more overspending and confiscation.

I'm sure that will work as well as amassing more debt, to fix a debt problem.

Jul 09 02:44 PM