Tim Fernholz says that even with moderate tax increases, the rich find ways not to pay.
Don’t tax the rich. Jesus, don’t tax the rich. They’re making the economy go, they’re investing, they’re job-creating. So goes the refrain of Republicans, lobbyists, and other supporters of the Bush tax cuts for the wealthy, which will terminate automatically at the end of the year if Congress doesn’t bestir itself. When the cuts expire, people making more than $250,000 — about the top 3 percent of earners in the country — can expect to pay a 3 percent tax increase, with their marginal tax rate rising from 33 percent to 36 percent. If they make more than $374,000, they will pay 4.5 percent more to the government and go from paying 35 percent of income over that line to paying 39.5 percent.
