It should be pointed out that while people tend to become conservative as they become wealthy, as the wealth climbs that changes so that by $100 million in wealth, people tend to become more liberal.
At least according to one author who was recently interviewed. But both Buffet and Gates are in that category.
As far as how much income tax is paid, you can never include paper profits. There are many people who make money on paper, but are not paying the tax on it because it is not realized profits. There are also people who became rich, then lost it all, with the whole thing on paper, so they never were able to enjoy being “rich”.
When a person owns $10 million in stock, and the stock climbs by 10%, their net worth has increased by $1 million, yet no tax. People see this, and say, “Raise the tax on the rich”. But increasing the tax will not affect this profit, and never will because it is not profit until it is sold.
But politicians listen, decide they will increase taxes on the rich, and suddenly anyone making $50,000 a year is rich.
1 mistake Regan made was to increase the long term gains tax. This actually resulted in a drop in the revenue from that tax dropping by half.
In the 90’s, people were complaining about the Republican congress reducing that same tax, and the results were people who were holding stock had the incentive to finally realize that profit without the big tax hit, and money was flooding into the treasury.
This was the big event that really boosted the 90’s economy. (Oh no, not that supply side economics.) Then with congress actually limiting the budget increases to 3% a year, the deficit shrank to the point that we almost had some surplus years.
(No we never actually had surplus years. The debt still climbed each year, regardless of what you have heard.) Clinton took all the credit, then after about 3 years the Republicans forgot everything, and were no different then the Democrats.
in 1998 the CATO institute put out research int taxes, and found that an average paid manufacturing employee back then would have made an extra 15% if no for the hidden taxes and fees employers paid. (That number increased as the employee income went up.)
I did try to search for what the full amount of the tax effect is. I thought somebody did that research at one time, but I haven’t found it.