There's a lie going around. The massive lie that the 1% pay a lower tax rate than the bottom 50%. If you are willing to look at actual numbers, I recommend reading the article. If you are worried about harming your view of the world and wish to live in your perfect Socialist bubble, you might need to move on.
It's now a widespread belief that the 1% pays a lower tax rate than the "poor." This statistic came from a research study conducted by a Professor of Economics at UC Berkeley ( Emmanuel Saez ), and an Assistant Professor of Economics, at UC Berkeley ( Gabriel Zucman )
This is not necessarily a widespread belief due to the fact that they published the study. Plenty of studies have been published, and very little of them are read. This is now a widespread belief because of politicians like Bernie Sanders, Elizabeth Warren, and the media. All of them are capitalizing on what this belief would lead people to support; higher taxes, and more power for those that support a larger government.
In the study, Saez and Zucman chose to compare America's richest 400 households, to the bottom half of the country. Don't ask me why they chose the seemingly random number of "400." Seems fairly arbitrary given the fact that there were 1.4 million tax returns in the 1%.
The study found that alarmingly, the top 400 households paid a tax rate of 23%, while the bottom half of households paid 24.2%. Unfortunately for the public, and the well-being of the country as a whole, the number of "24.2%" was completely manipulated.
The study took the "effective" tax rate paid by those 400 families, and compared it to what it called the "effective" tax rate of the bottom half. One could only call the statistic for the bottom half the "effective" rate if they were trying to create a false narrative, because it couldn't be further from the truth.
We should be looking for the answer to the question: When it's all settled, what percentage of an individual's income was confiscated by the Government, for use of the "public good?"
Saez and Zucman's study did not attempt to answer this question. How do we know this? Because while they accounted for the actual percentage confiscated from the top 400 families, they did not present the actual percentage confiscated from the bottom half of the country.
Their study made one simple feat of statistical manipulation. The researchers decided that they could not properly account for the Earned Income Tax Credit, or the Child Tax Credit. Since the top 400 families did not qualify for these, the number for the top 400 was accurate, but the number for the bottom half was not.
This means that if throughout the year someone paid $5,000 in taxes on their $20,000 income, the study reported this as a payment of 25% in taxes. Of course, if you only earned $20,000 in income, you received a tax return, more than likely nearly in the full amount of the taxes you paid. On top of that, if you had children, you might have received another $2,800 on your tax return. If you paid $5,000 in taxes throughout the year, but you received a $6,000 tax return, what was your tax percentage? According to Saez and Zucman, you paid 25% in taxes.