Taxes?????????????????????

Bg B: Taxes?????????????????????
If a pro hockey player makes 4-7 million dollars a year how much of it goes to taxes and does he get it back. My mom just told me what taxes are and I don’t understand what the point is why is it that people that make 5 million dollars have to pay more than people that only make 50 000 dollars
I don’t get taxes please explain.
I don’t know if it is different for different states and countrys but I live in alberta canada and don’t get it.

Answers and Views:

Answer by wartz
Actual rates vary by country and localities. You will pay more in Canada than I do in the USA on the same amount of income.

Income tax is based on ability to pay. From those to whom much is given, much is expected.

Answer by Sahara
They can afford to and their country allows them the opportunity to earn a lot of money so they must give back for the greater good. But the IRS (Internal Revenue Service) handles the taxes. The government sets the terms.
Income brackets pay different rates.

Answer by J P
Income tax is a tax based on how much money you make. It’s a percentage. So if you make 50 dollars, and have 10% taxes, you pay 5 dollars. If I make 500 dollars and have 10% taxes, I pay 50 dollars.

So someone making 4-7 million dollars will generally have a 35-70% tax bracket depending upon where they live. In the United States, the highest tax bracket is 35% plus some base dollar amount depending upon “filing status” (married, unmarried etc.) So if the person making $ 4 million is in the US they will pay approximately $ 1.4 million in taxes.

Answer by crapaudblanc
Canada is more of a socialist country than the US. The principle comes from sharing of wealth effect. Those than earn more need to pay more as a percentage so that they can share their wealth with the rest of the people.
i.e. a hockey player makes $ 5M and will pay 50% tax (or $ 2.5M), while someone making $ 100K will pay 10% tax (or $ 10K). The hockey player still has $ 2.5M sufficient enough to largely enjoy life (?), the other guy has $ 90K left barely enough to pay for his house and put food on the table. The wealthier you are the more you should participate into the country wealth. This is a socialism principle of sharing wealth.

Answer by Steve
Using your example, the hockey player is required to pay federal income tax in the US and Canada.

Also, the hockey player is required to pay state income tax in each state that the hockey player plays for the salary earned for that game. I can’t answer about Canada though. It could be the same rules.

In the US, it is referred to as the Michael Jordan rule.