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Think of a tax break this way....

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  • Think of a tax break this way....

    Suppose that every day, ten men go out for beer and
    the bill for all ten comes to $100 and If they paid
    their bill the way we pay our taxes, it would go something
    like this:

    The first four men (the poorest) would pay nothing.
    The fifth would pay $1.
    The sixth would pay $3.
    The seventh would pay $7.
    The eighth would pay $12.
    The ninth would pay $18.
    The tenth man (the richest) would pay $59.

    So, that's what they decided to do.

    The ten men drank in the bar every day and seemed
    quite happy with the arrangement, until one day, the
    owner threw them a curve. "Since you are all such good
    customers," he said, "I'm going to reduce the cost of
    your daily beer by $20." so drinks for the ten now cost
    just $80.

    The group still wanted to pay their bill the way
    we pay our taxes, so the first four men were unaffected...They
    would still drink for free...But what about the other
    six men - the paying customers? How could they divide
    the $20 windfall so that everyone would get his 'fair
    share?'...They realized that $20 divided by six is
    $3.33...But if they subtracted that from everybody's
    share, then the fifth man and the sixth man would each
    end up being paid to drink his beer..So, the bar owner
    suggested that it would be fair to reduce each man's
    bill by roughly the same amount, and he proceeded to
    work out the amounts each should pay.

    And so:
    The fifth man, like the first four, now paid nothing
    (100% savings).
    The sixth now paid $2 instead of $3 (33%savings).
    The seventh now pay $5 instead of $7 (28%savings).
    The eighth now paid $9 instead of $12 (25% savings).

    The ninth now paid $14 instead of $18 (22% savings).
    The tenth now paid $49 instead of $59 (16% savings).

    Each of the six was better off than before...And
    the first four continued to drink for free...But once
    outside the restaurant, the men began to compare their

    "I only got a dollar out of the $20,"declared the
    sixth man. He pointed to the tenth man," but he got
    $10!" "Yeah, that's right," exclaimed the fifth man.
    "I only saved a dollar, too. It's unfair that he got
    ten times more than I!" "That's true!!" shouted the
    seventh man. "Why should he get $10 back when I got
    only two? 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 drinks,
    so the nine sat down and had beers without him. But
    when it came time to pay the bill, they discovered something
    important. They didn't have enough money between all
    of them for even half of the bill!

    And that, ladies and gentlemen, journalists and college
    professors, 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 anymore.
    In fact, they might start drinking overseas where the
    atmosphere is somewhat friendlier.


    For those who understand, no explanation is needed.
    For those who do not understand, no explanation is
    Live like you'll die tomorrow, learn like you'll live forever.

  • #2
    Maybe people can understand this explanation.


    • #3
      Wonderful narrative. Thanks.