The Capital Gains Tax Controversy -- to Be Fair or to Aid Investment?

Except that people making less than $15k/year barely scrape by on what they have. They literally can't afford to pay income taxes.

Well Pack, they would pay a small amount. If they can pay that, they should get a second job.

So you and everyone else should be paying an effective rate of 25% (no deductions or exemptions) as I am under the Alternative Minimum tax. I could except that as fair.
Not smart, but fair.

The statistics are startling:

Eighty-two of the 275 companies, almost a third of the total, paid zero or less in federal income taxes in at least one year from 2001 to 2003. In the years they paid no income tax, these companies earned $102 billion in pretax U.S. profits. But instead of paying $35.6 billion in income taxes as the statutory 35 percent corporate tax rate seems to require, these companies generated so many excess tax breaks that they received outright tax rebate checks from the U.S. Treasury, totaling $12.6 billion. These companies' "negative tax rates" meant that they made more after taxes than before taxes in those no-tax years.
Twenty-eight corporations enjoyed negative federal income tax rates over the entire 2001-2003 period. These companies, whose pretax U.S. profits totaled $44.9 billion over the three years, included, among others: Pepco Holdings (-59.6 percent tax rate), Prudential Financial (-46.2 percent), ITT Industries (-22.3 percent), Boeing (-18.8 percent), Unisys (-16.0 percent), Fluor (-9.2 percent) and CSX (-7.5 percent), the company previously headed by current Secretary of the Treasury John Snow.
In 2003 alone, 46 companies paid zero or less in federal income taxes. These 46 companies told their shareholders they earned U.S. pretax profits in 2003 of $42.6 billion, yet they received tax rebates totaling $5.4 billion. Almost as many companies, 42, paid no tax in 2002, reporting $43.5 billion in pretax profits, yet receiving $4.9 billion in tax rebates. From 2001 to 2003, the number of no-tax companies jumped from 33 to 46, an increase of 40 percent.
In 2001, the Treasury paid corporations $40 billion in tax refunds, a third more than the 1998-2000 average.
Then in 2002 and 2003, after the law was changed to expand tax subsidies and make it easier for corporations to carry back excess tax breaks to earlier years, corporate tax refunds skyrocketed to an average of $63 billion a year - more than double the 1998-2000 average.

Corporations are now paying the lowest levels of taxes in the post-World War II era. In fiscal 2002 and 2003, federal corporate incomes taxes dropped to their lowest sustained level as a share of the economy since World War II. Only a single year during the early Reagan administration was lower.

In 1986, President Ronald Reagan fully abandoned his earlier policy of showering tax breaks on corporations. The Tax Reform Act of 1986 closed tens of billions of dollars in corporate loopholes, so that by 1988, the overall effective corporate tax rate for large corporations was up to 26.5 percent. That improvement occurred even though the statutory corporate tax rate was cut from 46 percent to 34 percent as part of the 1986 reforms.

In the 1990s, however, many corporations began to find ways around the 1986 reforms, abetted by tax-shelter schemes devised by major accounting firms.

Effective corporate tax rates then plummeted, thanks to Bush administration-backed tax breaks passed in 2002 and 2003, continued corporate offshore tax-sheltering, and the refusal of the Congress and White House to crack down on even the most abusive inherited corporate tax-sheltering activities.

So how is this fair? Or smart. The ppl at the top pay less then I do as a small business owner. Less then the ave middle class wage earner. thats whats not smart.

Thats not the question. the question is why people at the top bracket pay less then everyone else. All taxes should be equal. Income is income. No matter how it is derived.

James, a new better question, is why you can't perform or understand basic math/logic principles?

They do too pay tax. Every time they pit gas in their cars. Every time they pay phone bills, utility bills, buy alcohol or tobacco, cable bills, buy anything imported, take a flight, fill up their propane tanks, unemployment taxes, register vehicles, buy a car, etc. These are federal taxes, not including state taxes, and sales tax. As a percentage, the poor pay a larger share of their taxes than does Warren Buffett. That's the point.

BMS, Those are fees not taxes. And they do not pay a larger percentage of their income in taxes. Check the IRS tax statistics.

The 48% number is a party lie. has nothing to do with reality as it includes retirees, disabled, and more. I hate when ppl throw around party media as if it were fact.
Also the amount they pay in the end is moot. As they should pay the same rate as anyone else. Why should corps have a 17 5 ave and the middle class 36%. their special because the make more then me? Please!

yes but what does how much you make have to do with it. this is a straw man argument. EVERYONE should be taxed at the same rate! No matter where the income comes from. Income is, well income. Weather it's stocks and bonds, a business you own or your paycheck ALL SHOULD PAY THE SAME!
based on your presumption, these people are better then I am and get special considerations. just because they made more then me.

If this woman is paying 30% as some have said then she's doing just fine because she'd have to make at least $200,000 a year to pay at that rate.