While Nearly Half Of U.S. Households Pay No Federal Income Taxes, Most Pay Other Taxes

Tax Policy Center: 47 Percent Of U.S. Households Will Pay No Federal Income Tax This Year. In a June 2009 report, the Tax Policy Center (TPC) stated that "[e]arlier this year, [President] Obama signed into law the American Recovery and Reinvestment Tax Act of 2009 (P.L. 111-5), which, among other things, temporarily put into place some of the refundable credits proposed during the campaign. TPC estimates that under the new law, 47 percent of tax units will owe no income tax in 2009." [Tax Policy Center, 6/29/09]

AP: "[V]ast Majority Of People Who Escape Federal Income Taxes Still Pay Other Taxes." The Associated Press cited that TPC statistic in an article, noting that “their incomes were too low, or they qualified for enough credits, deductions and exemptions to eliminate their liability.” The AP further wrote that "[t]he vast majority of people who escape federal income taxes still pay other taxes, including federal payroll taxes that fund Social Security and Medicare, and excise taxes on gasoline, aviation, alcohol and cigarettes. Many also pay state or local taxes on sales, income and property." [Associated Press, 4/7/10]

Fox Has Relentlessly Propagated This Falsehood

Hannity Falsely Claimed “Half Of Americans ... Don't Pay Taxes.” On his Fox News show, Sean Hannity stated, “If half of Americans now don't pay taxes, and the other half are the beneficiaries of the tax that the other half pay, at some point you say, OK, you got a full voting block and it seems like the Democratic Party ... caters to that.” [Fox News, Hannity, 8/30/10]

• Hannity has made the similar claim that 50 percent of Americans don't pay taxes over and over again. [Fox News, Hannity, 4/15/10, 4/12/10, 4/9/10, 4/8/10]

Beck Falsely Claimed That “49 Percent” Of Americans “Don't Pay Any Tax.” On his show, Glenn Beck stated: “How do we get people that are not paying taxes -- you know, I saw this -- did you see this poll this week? There was like 48 percent say they pay their right amount of taxes and 49 percent don't pay any tax. I mean, you know, how do we get those people to understand, no, no, we gotta shut this system down and change it drastically.” [Fox News, Glenn Beck, 4/16/10]

Carlson: “40 Percent Of The Country Does Not Pay Any Tax.” On Fox & Friends, co-host Gretchen Carlson stated: “Here's the other figure that makes me scratch my head a little bit -- the fact that 40 percent of the country does not pay any tax.” But as guest Pat Cadell pointed out, “that's income taxes.” He added: “Now people do pay sales and local taxes. They pay Social Security.” [Fox News, Fox & Friends, 8/3/09]

Bolling Also Relied On Flawed Analysis On Government Aid

Bolling Pushes Claim That “35 Percent Of Total Wages In America” Are From Government Handouts. From the same Fox & Friends segment:

DOOCY: I saw this statistic, couldn't believe it: a third of the people in this country are winding up with a handout from the government?

BOLLING: The government payouts account now for 35 -- see that? -- 35 percent of total wages in America right now. And that's up from 21 percent in 2000 and you can see 1960 is only 10 percent. At this rate, in four years, the government will account for more than 50 percent of total wages in America. As baby boomers are retiring, they're getting a lot of Social Security benefits, unemployment benefits. It's a bad, bad scary trend.

GRETCHEN CARLSON (co-host): That is astounding -- 50 percent?

BOLLING: At that rate, if it continues at that incline, yeah. Within four years, we'll exceed 50 percent.

CARLSON: Well, obviously, America can't afford that --

BOLLING: It can't. No.

CARLSON: -- so we'll have to do something.

BOLLING: No, it's a tipping point. [Fox News, Fox & Friends, 3/10/11]

Bolling's Claim Derived From Flawed CNBC Analysis. CNBC executive producer John Melloy published a piece asserting that “Government payouts -- including Social Security, Medicare and unemployment insurance -- make up more than a third of total wages and salaries of the U.S. population, a record figure that will only increase if action isn't taken before the majority of Baby Boomers enter retirement.” [CNBC.com, 3/8/11]

Columbia Journalism Review: CNBC's Numbers “Don't Add Up.” In a post fact-checking the CNBC story, the Columbia Journalism Review found “so many things wrong” with the report, saying that the study CNBC's article was based on “is just inaccurate.” From CJR:

The immediate red flag here is that it seems rather artificial to do a ratio of government payouts to wages and salaries, rather than, say, GDP or even personal income. So I took a look at the numbers, and they don't add up.

Indeed, CNBC says government “handouts” account for more than a third of all wages and salaries in the U.S. But that's not right. Social Security payments and the like aren't included in the Bureau of Economic Analysis's wages and salaries numbers (CNBC doesn't give us much data from the report it cites, much less link to it, but it says it was based on BEA data). Those come from, well, wages and salaries, which totaled $6.4 trillion last year.

[...]

But there's more wrong here. “Fast Money” executive producer John Melloy (last seen writing this story: “Giant Full Moon Coming-- Danger for Stocks?”) and the firm that did the study are only counting wages and salaries in the denominator (the $6.4 trillion number), while they're counting health care in the form of Medicare and Medicaid, not to mention veteran's pensions and job training, in the “welfare” numerator. That's apples to oranges. Those “supplements to wages and salaries” came to $1.6 trillion last year, according to the BEA. Add those in to make this somewhat apples to apples and it brings our denominator to $10.2 trillion and the “handouts” are down to 22 percent.

The study also doesn't include non-corporate business owners' income. Nor does it include rent or capital income, like, say, interest from your savings account or capital gains from your 401k (owners of capital get “handouts,” too, CNBC).

[...]

Moreover, at least 2 percent of those government “handouts” in the $2.2 trillion number are veterans' benefits.

So CNBC's welfare and “handouts” number, by any normal standard, is actually far, far lower than even that 18 percent I calculated three paragraphs up, much less its 35 percent number. If you exclude Social Security and veterans' benefits, as you should, we're creeping down toward 10 percent. [Columbia Journalism Review, 3/9/11]

Bolling Routinely Mangles Economic Facts

Bolling Repeatedly Claimed Bush's Moratorium Decision Caused Oil Prices To Drop From $147 To $33. In at least six instances over the past three months, Bolling has claimed that President Bush's July 2008 decision to lift the presidential moratorium on offshore drilling caused oil prices to drop from "$147 straight down to $33 a barrel in six months." Energy experts told Media Matters that Bolling's analysis is wrong. Moreover, reports from 2008 and 2009 attributed the drop in oil prices to economic slowdown. [Fox Business, Follow the Money, 3/8/11]

Bolling Dismissed Speculators And Tied Oil-Price Fluctuations To Offshore Drilling Policies. On his Fox Business show, Bolling dismissed concerns that speculators are helping to fuel increases in the cost of oil, instead using those higher costs to push for increased oil drilling. But speculators currently hold record bets on oil futures, and experts have said those bets are driving up the cost of oil. [Fox Business, Follow the Money, 3/7/11]

Bolling Repeated Misleading Talking Point That U.S. Has “Either First Or Second Highest” Corporate Tax Rate In The World. On America's Newsroom, discussing how the cost to businesses of hiring workers is “excessive,” Bolling outlined what “businesses are waiting on,” including changes to “our corporate tax structure.” Bolling claimed that the United States has “either [the] first or second highest corporate tax rates in the developed world,” adding, “We need to bring those numbers down.” In fact, the effective corporate tax rate, which accounts for tax benefits received by corporations, is lower in the United States than in several other nations. [Fox Nation, America's Newsroom, 1/26/11]

Bolling Pushed Debunked Claim That Ending Bush Tax Cuts Harms Small Business. On America's Newsroom, Bolling and host Bill Hemmer discussed the current debate over extending the Bush tax cuts for those making more than $250,000 a year. Bolling claimed, “Half of the filers over $250,000 will be small business. So they'll be affected.” In fact, at least 97 percent of small businesses would not be affected. [Fox News, America's Newsroom, 11/19/10]

Bolling Falsely Claimed Only 595,000 Jobs Have Been Created By The Stimulus. On Fox & Friends, Bolling claimed of stimulus money: "$272 billion has been spent," but only “595,000 jobs [have been] created.” He added that “that's $450,000 per job.” In fact, the Recovery.gov employment numbers Bolling cited only represented jobs funded from October 1-December 31, 2009, which made up a small part of the total number of jobs that the White House and other economists estimated had been funded by the stimulus at the time. [Fox News, Fox & Friends, 2/16/10]

Bolling Falsely Claimed “Illegals” Are “Not Paying Taxes.” On Fox Business' Bulls and Bears, Bolling claimed that American citizens “pay taxes,” as opposed to “illegals not paying taxes,” saying: “We're all paying tax. If you remove the illegals who are not paying tax with Americans or legal immigrants who do pay tax, everyone wins, everybody wins.” In fact, according to the Congressional Budget Office and the Social Security Administration, undocumented immigrants do pay taxes, including individual income, sales, property, and social security taxes. [Fox Business, Bulls and Bears, 5/1/10]