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# Governor Taxed Rich Increased the Minimum Wage -- State's Economy Is One of the Best

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posted on Mar, 1 2015 @ 02:05 PM

originally posted by: BuzzyWigs

You are wrong.

Sorry to rain on your parade, but you are wrong. The number you should be looking at is the "Effective tax rate".

posted on Mar, 2 2015 @ 06:49 PM
The very wealthy should be taxed significantly, if their money is not invested towatds buisnesses. Granted that needs to happen on a nationwide if not global scale, because not every state is host to one of the one percent and they could just switch state or country if faced with a heavy tax burden.

posted on Mar, 2 2015 @ 08:04 PM

originally posted by: onequestion

Its still a higher tax bracket what are you talking about?

Perhaps this explanation is needed - taxes are marginal. The 2014 income tax brackets are 10%, 15%, 25%, 28%, 33%, 35%, and 39.6%.

Suppose you file as single and made \$9,075 working odd jobs, the threshold for 10% taxation.
You owe \$907.50, effectively 10% before any deductions.
Suppose you get a job, and make \$36,900, the threshold for 15% taxation.
You owe \$907.50 + \$4,173.75 = \$5,081.25, effectively 13.77% (NOT \$5,535) before any deductions.
Suppose you get an better job, and make \$89,350, the threshold for 25% taxation.
You owe \$5,081.25 + \$13,112.50 = \$18,193.75, effectively 20.36% (NOT \$22,337.50) before any deductions.
Suppose you get an even better paying job, and make \$186,350, the threshold for 28% taxation.
You owe \$18,193.75 + \$27,160 = \$45,353.75, effectively 24.34% (NOT \$52,178) before any deductions.
Suppose you invent some new toilet paper holder, and make \$405,100, the threshold for 33% taxation.
You owe \$45,353.75 + \$72,187.50 = \$117,541.25, effectively 29% (NOT \$133,683) before any deductions.

To make a long explanation short, marginal tax rates apply only to the income within that bracket. If you made \$9,076 (threshold + \$1), you would be taxed \$907.50 (\$9,075 at 10%) + \$0.15 (\$1 at 15%).
edit on 20Mon, 02 Mar 2015 20:08:58 -0600America/ChicagovAmerica/Chicago3 by Greven because: (no reason given)

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