Let’s put tax cuts in terms everyone can understand.
Ten men go out to dinner.
Suppose that every day, ten men go out for dinner. The bill for all ten comes to $100.
If they paid their bill the way we pay our taxes, it would go like this:
The first four men ( the poorest ) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
And the tenth man ( the richest ) would pay $59.
So, that’s what they decide to do.
The ten men ate dinner in the restaurant every day and seemed quite happy with the arrangement, until one day, the owner through them a curve. "Since you are all such good customers,“ he said. “ I’m going to reduce the cost of your daily meal by $20."
So, now dinner for the ten men only cost $80. The group still wanted to pay their bill the way we pay our taxes. So, the first four were unaffected . They would still eat for free. But what about the other six, the paying costermers ? How would they divvy up the $20 winfall so that everyone would get their
‘ fair share ‘ ?
The six men realized that $20 divided by six is $3.33. But if they subtracted that from everbody’s share, then the fifth man and the sixth man would end up being PAID to eat their meal. So the restaurant owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he procceded to work out the amounts each should pay.
And so :
The fifth man like the first four , now paid nothing ( 100% savings )
The sixth man paid $2 instead of $3 ( 33% savings )
The seventh now paid $5 instead of $7 ( 28% savings )
The eighth now paid $9 instead of $12 ( 25% savings )
The ninth now paid $14 instead of $18 ( 22% savings )
The tenth now paid $49 instead of $59 ( 16% savings )
Each of the six men was better off than before . And the first four continued to eat for free. But once out side the restaurant , the men began to compare their savings.
“ I only got a dollar out of the $20,” declared the sixth man. He pointed to the tenth man. “ But he got a $10 saveing“
“ Yeah that’s right ,” exclaimed the fifth man. “ I only saved a dollar too. It’s unfair that he got ten times more than me “.
“ That’s true !! “ shouted the seventh man. “ Why should he get $10 back when I only got $2 ? The wealthy get all the breaks ! “
“Wait a minute,” yelled the first four men. “ we didn’t get anything at all. The system exploits the poor.”
The nine men surrounded the tenth man and beat him up.
The next night the tenth man didn’t show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between them for even half of the bill !.
And that boys and girls, is how or tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up at the table anymore.
Please note that this was e-mailed to me from a freind. I thought that it might be fun for some of you to also read.
John.
Ten men go out to dinner.
Suppose that every day, ten men go out for dinner. The bill for all ten comes to $100.
If they paid their bill the way we pay our taxes, it would go like this:
The first four men ( the poorest ) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
And the tenth man ( the richest ) would pay $59.
So, that’s what they decide to do.
The ten men ate dinner in the restaurant every day and seemed quite happy with the arrangement, until one day, the owner through them a curve. "Since you are all such good customers,“ he said. “ I’m going to reduce the cost of your daily meal by $20."
So, now dinner for the ten men only cost $80. The group still wanted to pay their bill the way we pay our taxes. So, the first four were unaffected . They would still eat for free. But what about the other six, the paying costermers ? How would they divvy up the $20 winfall so that everyone would get their
‘ fair share ‘ ?
The six men realized that $20 divided by six is $3.33. But if they subtracted that from everbody’s share, then the fifth man and the sixth man would end up being PAID to eat their meal. So the restaurant owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he procceded to work out the amounts each should pay.
And so :
The fifth man like the first four , now paid nothing ( 100% savings )
The sixth man paid $2 instead of $3 ( 33% savings )
The seventh now paid $5 instead of $7 ( 28% savings )
The eighth now paid $9 instead of $12 ( 25% savings )
The ninth now paid $14 instead of $18 ( 22% savings )
The tenth now paid $49 instead of $59 ( 16% savings )
Each of the six men was better off than before . And the first four continued to eat for free. But once out side the restaurant , the men began to compare their savings.
“ I only got a dollar out of the $20,” declared the sixth man. He pointed to the tenth man. “ But he got a $10 saveing“
“ Yeah that’s right ,” exclaimed the fifth man. “ I only saved a dollar too. It’s unfair that he got ten times more than me “.
“ That’s true !! “ shouted the seventh man. “ Why should he get $10 back when I only got $2 ? The wealthy get all the breaks ! “
“Wait a minute,” yelled the first four men. “ we didn’t get anything at all. The system exploits the poor.”
The nine men surrounded the tenth man and beat him up.
The next night the tenth man didn’t show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between them for even half of the bill !.
And that boys and girls, is how or tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up at the table anymore.
Please note that this was e-mailed to me from a freind. I thought that it might be fun for some of you to also read.
John.
