Federal income tax fairness may depend on whether you pay the tax

The Tax Policy Center has concluded that 46.9 percent of households do not pay any income tax.


A lot of folks are giving thought to taxes these days. After all, the deadline to file federal income tax returns -- April 15 -- is fast approaching.

But how many of those people are actually worried about the taxes they pay? Not as many as you might think.

About half of the nation's households -- 46.9 percent to be exact -- don't pay even one penny in federal income tax, according to the Tax Policy Center, a Washington, D.C.-based research organization.

How can that be?

The income of households that don't pay taxes don't reach the taxable level or those households qualify for enough credits, deductions and exemptions to eliminate their tax liability.

That doesn't seem particularly fair to the 53.1 percent of the households that do pay federal income tax. Then again, fair -- as many of us have been told over and over -- is a weather forecast.

It seems reasonable that nearly all households would contribute a few dollars -- maybe a minimum of $100 -- to the federal treasury as a matter of principle. It's the reason that public transit systems, including Walla Walla's, charge a very modest fare to ride the bus. The money collected doesn't come close to covering the costs but it sends a clear message to the riders that they are contributing to the maintenance and operation of the bus system. It offers a sense of ownership -- perhaps even pride.

Yet, the opposite often occurs. The bottom 40 percent of earners make a profit. They get more money from tax credits than they would otherwise owe and receive a check.

While we don't blame people for using the system to their advantage, the system needs to be revised over time as the economy recovers.

Now, many of those who aren't paying any income tax are still paying taxes. They continue to pay federal payroll taxes for Social Security and Medicare, and excise taxes on gasoline, aviation, alcohol and cigarettes. Many also pay state and local sales taxes and property taxes. In Oregon they might pay state income taxes.

As a result, 75 percent of people in the U.S. pay some sort of federal tax. That means 25 percent don't.

These numbers fluctuate from year to year as Congress tinkers with the tax code. The health of the economy also plays a role.

The income tax system in this country is, to say the least, complex. One reason for that is it provides incentives for a variety of positive endeavors such as buying homes, investing and donating to charity, to name just a few.

We fully understand the need, and support the concept, of an indexed tax system in which those who can most afford it pay the most. We also understand some people will pay nothing.

But that doesn't necessarily mean that 100 percent of the tax burden should fall on about half the households.


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