Everyone pays taxes in different forms and quantities. Those who work for wages pay income taxes proportional to their income, also called federal payroll taxes. People who buy and consume gasoline pay federal and state gas taxes, while homeowners and renters pay property taxes.Continue Reading
Taxes are financial payments that governments charge from individuals or entities. Failure to pay or attempting to evade payment of taxes usually results in government-imposed penalties. Money collected from taxes serves different purposes. Governments can spend it on war, law enforcement, education, infrastructure, health care, social welfare, and many other functions and services of the state. Most people who purchase goods and services pay sales taxes.
The poorest quintile of Americans, who make 3.3 percent of total income, paid as much as 2.1 percent of all taxes collected, according to a 2014 study by Citizens for Tax Justice. The richest 1 percent of Americans, on the other hand, made up 21.6 percent of the total income while contributing 23.7 percent of total taxes.
The richest 1 percent earned 19 percent of income in 2010, while paying 37 percent of all taxes, according to data from the Internal Revenue Service. Meanwhile, the bottom half of income earners, who earned 12 percent of the total income, paid 2 percent of all federal income taxes.Learn more about Taxes