The "Courage Campaign's" False Statement
By David Henderson
In my state of California, the so-called Courage Campaign is pushing for higher tax rates on high-income people. California now, by the way, has one of the highest top marginal tax rates on income in the country: 10.3 percent. To push for an even higher marginal tax rate, the Courage Campaign has put together a video in which it tries to shame Kim Kardashian. Now I hold no brief (pun not intended) for Ms. Kardashian, but I do defend her right to keep what she has earned. More important, even if I didn’t defend her right, I think it’s important for people who want to tax her more to be accurate in their statements. The following statement that goes with the video contains a false statement:
Kim Kardashian made more than $12 million in 2010, but she only paid 1% more in taxes than a middle-class Californian.
Note, by the way, that they’re talking only about income taxes. It is true that middle-class families pay a higher percent of their income in sales taxes. But that’s not what they’re discussing.
Let’s see why it’s a false statement:
. If their $12 million income for Ms. Kardashian is correct, and if their $47,000 number for a middle class California family is correct, then Ms. Kardashian pays about $1.2 million in income taxes and the middle class family pays about $2,000 in income taxes. Is that 1% more? No. It’s about 59,999% more.
. Ah, but maybe they were talking about tax rates. OK. So let’s say the middle-class family pays an average tax rate of about 5%. Her average tax rate is about 10%. So that’s 100% more.
. OK. Maybe they were talking about percentage points, not percents. Fine. Her average tax rate of 10% is five percentage points more than that of the hypothetical middle-income California family. 5 does not equal 1.
. So maybe they were talking about percentage points and marginal tax rates, not average tax rates. OK, so let’s look at that. Ms. Kardashian’s marginal tax rate is 10.3%. This middle-income family’s marginal tax rate, if it has zero exemptions or deductions, which is unlikely, is 4% if the couple is married, filing jointly or 8% if it’s a single person. So her marginal tax rate is still 6.3 percentage points more (if we really are comparing it to a family), or 2.3 percentage points more (if we’re comparing to an individual).
Elsewhere on its site is another false statement. The “Courage Campaign’s” first statement here in support of the tax increase is that the measure:
asks Californians who make over $1 million per year to pay a little bit more
I leave finding the key false word in that statement as an exercise for the reader.
Does the Courage Campaign Have the Courage to Tell the Truth? We Shall See.
HT to William McGurn.