Who Should Pay Taxes?

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Meanwhile as the debate continues -- Mitt Romney's recent remarks on the 47% who don't pay federal income tax.

A new study by the Tax Foundation takes a look at the 58 million Americans who are actually collecting more in benefits from the government.

Than they pay in taxes Scott Hobbs joins me now he's the president of the Tax Foundation.

What surprised you most.

About this study stopped.

Well actually we looked at this huge growth in non payers that we've seen over the past twenty years and wondered.

What impact is that having on the federal budget we find that.

It's associated will today increase in transfers spending that's basic entitlements and -- fourth.

Of about 200 billion dollars this year.

So the the its -- we're seeing more than just affect these people don't pay income taxes.

There are also getting an awful lot in benefits to the tune of about 200 billion dollars what exactly constitutes -- -- -- Pam.

Just some and is pay no taxes thought.

So -- -- pays no income taxes because of the very generous credits and deductions that are in the tax code and that those of exploded over the last twenty years is that.

Iris has really been turned into it a super agency delivering all kinds of of us social benefits like the child credit energy credits.

The -- income tax credit a whole host of things.

It's essentially -- the about a hundred billion dollars a year in cash back to people who pay no income taxes whatsoever.

It's really become an extension of the welfare state.

Well we know this is not really sustainable what -- economists worrying about.

Well I think there's there's a real social dimension to this and we worry about people having no skin in the game.

And when government looks -- -- they're gonna demand more of it.

And so you'll you worry about this sort of social dimension where.

You have a rising group a growing group of people pay no taxes but demand more in government and they're expecting others to pay the bills.

And I think there's a real danger in Manhattan where you get more people.

Who benefit from government that are pain -- you know is.

From Benjamin Franklin said you know when people learn they can vote themselves money.

That's the end of the Republican I think that's what we're really worried about here and that's a good set up for this sound -- we've -- from Hillary Clinton we can run -- -- not get your thoughts on it was from a right now.

One of the issues that I have been preaching about around the world.

Is collecting taxes in an equitable manner.

Especially from the -- -- in every country it is a fact that around the world.

The elites of every country.

Are making money.

There are rich people everywhere.

And yet they do not contribute.

To the growth of their own countries.

Scott if it wasn't for the rich how -- these programs get paid -- would you -- -- -- Yeah I guess we're seeing very ideology come -- But she's really ignorant of the fact.

That the United States actually has -- these most progressive personal income tax system of any industrialized country -- -- the wealthy in this country pay a larger share of the income tax burden then do the rich in any other industrialized country.

Including Sweden and France and while the poor people in America have the lowest tax burden.

Of any industrialized country.

We're already soaking the rich here in the United States.

And so soaking the ritual that more is not gonna solve the problems of America very quickly how does the problem get fixed demonstration is -- -- issue.

Well we need fundamental tax reform at there at the end -- that's the the basic -- solution but we need a national discussion of how low should.

Your income be before you pay no income taxes right being of that tax code is already is always protected the pork.

But now we're -- protecting the middle class and income taxes well and that's a problem.

Right.

Interesting stuff Scott -- thank you so much for joining us got really appreciate it thank US.

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Who Should Pay Taxes?

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