Paul Ryan wants to kill all tax on capital gains, interest, and dividends — income you get from owning things, rather than doing a job. Under this plan, Mitt Romney’s $21,000,000 in 2010 income would be largely tax-exempt. Only his speaking and author fees — $593,996 — would be taxed, and only at 25%, for a net tax of $177,650 on $21,661,344 — that is, 0.82%.
But don’t worry, the government won’t go broke if the super-rich are virtually tax exempt. Under Ryan’s budget, tax on the bottom 30% of earners will increase. Matthew O’Brien explains in The Atlantic:
It might seem impossible to fund the government when the super-rich pay no taxes. That is accurate. Ryan would actually raise taxes on the bottom 30 percent of earners, according to the nonpartisan Tax Policy Center, but that hardly fills the revenue hole he would create. The solution? All but eliminate all government outside of Social Security and defense — a point my colleague Derek Thompson has made in incredible chart form.
Mitt Romney Would Pay 0.82 Percent in Taxes Under Paul Ryan’s Plan
(via Reddit)