Taxes: Who Pays Them.

Vince Farrell of CNBC fame and currently Chief Investment Officer for Soleil Securities is out with an interesting thought on taxes yesterday.

"President-elect Obama promised 95% of the people a tax cut. That would require raising taxes on the other 5%. Raising taxes during economic hard times is never a good idea."

According to Vince, here is how taxes currently break out using the last full year of data available which was 2006:

*The top 1% of all wage earners make at least $364,657. That group earned 22% of all income and paid 40.4% of all taxes levied on individuals. The top 1% paid almost as much as the lower 95%. The percent of taxes paid by the top 1% has increased from 19% of all taxes to the current 40% over the last 25 years.

*The top 5% of all wage earners made at least $145,283. The top 5% paid 60% of all taxes.

*The top 10% of all wage earners brought home at least $103,912. The top 10% paid 70% of all taxes.

*The top 25% of all incomes made at least $62,066. They paid 86% of all income taxes.

*Almost 40% of all American earners are currently scheduled to pay no income tax by 2009.

We always say follow the money. I think it's going to be almost impossible given all the money we've spent to give 95% of us a tax cut based on what we know today and the current income statistics. Watch for a certain amount of hedging on this to creep into the new Obama Administration's rhetoric over the coming weeks.

#Source: Soleil Securities, Perspective: Taxes, Vincent Farrell, 11/06/08.