Wealth

A family of four with two children under age 7 can earn $90,000 and pay zero income tax. This is because of the child tax credit which is $3,600 for each child under age 7. The same family with two children over age 7 but under age 18 can earn $80,000 and pay no income tax because the child tax credit for children between ages 7 and 18 is $3,000 per child. 40% of all tax payers earn more than $90,000 and they pay 90% of all income tax. While many people have a net worth of more than one million dollars only 150,000 Americans earn more than one million per year. If you passed a law stating that all earned income over $1 million would be taken by the government no one would earn over $1 million. A better way to nail the rich is to go after assets with something like Senator Warren's proposed wealth tax. Amazon CEO Jeff Bezos has $166 billion in wealth mostly in the form of Amazon stock. A wealth tax of 10% would give the government $16 billion dollars that they could then redistribute to get votes. This would be $16 billion less that Bezos would have to grow his business and create new jobs. It is not likely that any new tax the government comes up with will be used to pay down debt. It is most likely it would be used to create new programs to spread the wealth around.