Tax Day 2022: We Need to Tax the Rich — Now

NPP Pressroom

Teen Vogue
Lexi McMenamin
04/19/2022

It’s Tax Day, but I haven’t done my taxes. I’m proud to hold my current job here at Teen Vogue, but last year I was at the mercy of the gig economy, taking on freelance assignments and contractor roles, meaning I now have a whole mess of paperwork glaring me in the face and literally no initiative to dive in. 

I made less than $72,000 last year, so I qualify for free tax services. Most people in my position don’t know that, though, and end up getting swindled by predatory tax preparation services like TurboTax.

No wonder everybody hates tax season: It’s easy to screw up, and nobody wants to get audited, especially while making low wages. It’s a shame (and not just for my mental health, ha ha, lol), because I’m generally pro-taxes. Wealth redistribution is good! We just have a terrible system in place. Proof positive: The average taxpayer — the median U.S. household income is about $67,500, per 2020 Census data — pays an average rate of 13% in federal income tax. Let’s contrast that with how we tax the rich (spoiler alert: not enough).

As ProPublica recently reported, using a trove of IRS documents on the uber-wealthy over the span of 15 years, “The IRS records show that the wealthiest can — perfectly legally — pay income taxes that are only a tiny fraction of the hundreds of millions, if not billions, their fortunes grow each year,” in spite of our “progressive” tax system. The piece ticks off Jeff Bezos of Amazon, Elon Musk of Tesla, and other wealthy men such as failed presidential candidate Michael Bloomberg and philanthropist George Soros as among those who evaded federal income tax for whole years.

Based on ProPublica’s analysis, the 25 richest people in the U.S. paid a true federal tax rate of 3.4% from 2014 to 2018. "The impact on real people is devastating, leading countless families to slip into poverty," Gina Cummings, vice president of advocacy, alliances, and policy at Oxfam America, told Common Dreams. "The ongoing failure of our nation's leaders to implement a more equitable tax system is a stain on democracy." 

The situation is so obviously ugly, there are millionaires looking to organize other millionaires into giving up some of their wealth, as the government is clearly disinterested. For Tax Day 2022, that group of millionaires called for higher taxes on the rich by putting up digital billboards on Wall Street; facing various federal buildings; at the offices of the Democratic National Committee; and outside the home of Jeff Bezos.

We shouldn't be surprised, though; as Rebekka Ayres wrote for Teen Vogue in 2021, “Every billionaire is a policy failure” — a failure Americans have watched continue for a long time. Even these particularly painful stats from the ProPublica report only confirm what we already knew. Back in the 2020 Democratic primaries (what feels like a century ago), senators Elizabeth Warren (D-MA) and Bernie Sanders (I-VT) proposed “tax the rich” policies, raising the national profile for the movement.

Teen Vogue Economic Security Project senior fellow Jacqui Germain has explained the methods that the wealthy use to evade federal taxes: They hide it in loans; they can afford skilled lawyers and lobbyists to keep regulators off their backs; they evade taxes by accruing wealth but keeping job “income” low. Again, we already knew the wealthy were gaming the system. At this point, the government is letting them get away with it.

And for what? Even the way we spend those funds is a disappointment. The National Priorities Project at the Institute for Policy Studies ran the numbers for what American tax dollars — which, again, are barely coming from the behemoths of wealth that exist in this country — funded in 2021. The big-ticket items included: Pentagon contractors; nuclear weapons; deportations and border control; federal prisons. Receiving a fraction of those funds: K-12 education; the Centers for Disease Control and Prevention; renewable energy; homelessness prevention.

Today, Senator Warren wrote for the New York Times that the only way Democrats can hope to win in the 2022 midterms is by embracing the working class, in part by passing new taxes on corporate profits. Even if Warren is right, Democrats like Senator Kyrsten Sinema (D-AZ) are holding back that process, blocking tax hikes for the wealthy from within their own party.

Meanwhile, the rich keep getting richer. The Guardian reports that last week, three members of the Cargill family — owners of one of the world’s biggest food companies — joined Bloomberg’s Billionaire Index of the 500 richest people alive. What pushed them onto the list? Cargill’s stock price rose due to profits the company made off of food shortages induced by Russia’s war on Ukraine. 

War profiteering, union busting, you name it: The wealthy’s war on Americans will keep going until someone or something gets in its way.

Tl;dr: Tax the rich. Until then, I guess I’ll just keep filing my silly little 1099s and try to avoid getting audited.