05-23-2005, 01:40 AM
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#1 (permalink)
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Fast'n'Bulbous
Location: Australia, Perth
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The Tax System
I received this email today and found it quite interesting. I am not an accountant or anything so am not sure if its as clear cut as this.
Quote:
The Tax System.
Here is the real story to lighten the Budget discussion! You've heard the
cry in the last 5 or 6 days from across Australia: "It's just a tax cut for
the rich!", and it is accepted as fact. But what does that really mean? The
following explanation may help.
Suppose that every night, 10 men go out for dinner at La Porchetta's. The
bill for all 10 comes to $100. They decided to pay their bill the way we
pay our taxes and it went like this:
* The first four men (the poorest) paid nothing.
* The fifth paid $1.
* The sixth $3.
* The seventh $7.
* The eighth $12.
* The ninth $18.
* The tenth man (the richest) paid $59.
All 10 were quite happy with the arrangement, until one day, the owner
said: "Since you are all such good customers, I'm going to reduce the cost
of your daily meal by $20." So now dinner for the 10 only cost $80.
The group still wanted to pay their bill the way we pay our taxes. The
first four men were unaffected. They would still eat for free. But how
should the other six, the paying customers, divvy up the $20 windfall so
that everyone would get his "fair share"? They realised that $20 divided
by six is $3.33. But if they subtracted that from everybody's share, then
the fifth and sixth men would each end up being paid to eat. The
restaurateur suggested reducing each man's
bill by roughly the same percentage, thus:
* The fifth man paid nothing (like the first four) instead of $1 (100%
saving).
* The sixth paid $2 instead of $3 (33% saving).
* The seventh paid $5 instead of $7 (28% saving).
* The eighth paid $9 instead of $12 (25% saving).
* The ninth paid $14 instead of $18 (22% saving).
* The tenth paid $49 instead of $59 (16% saving).
Each of the six was better off, and the first four continued to eat for
free, as now did the fifth - but outside 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 $10!" "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 got only $2? The wealthy get all the breaks!"
"Wait a minute," yelled the first four men in unison. "We didn't get
anything at all. The system exploits the poor!" The nine men surrounded the
tenth and beat him up.
The next night the tenth man didn't show up for dinner. The nine sat down
and ate without him, but when they came to pay the bill, they discovered
that they didn't have enough money between all of them to meet even half of
the bill!
That, boys and girls, journalists and college professors, special interest
whingers is how our 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.
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I still think there should be some point where you can have "enough" money to get by. eg whats the difference between 100 million and 1 billion for one person? It's a lot of fucking money - but the difference could help a lot of other people; surely there's a point where something could be enough (such that they wouldn't need to receive money back from the government). Although this is probably way too hard and controversial to objectively govern... |
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