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Old 05-06-2011, 10:32 AM
bjkeefe bjkeefe is offline
 
Join Date: Jan 2007
Location: Not Real America, according to St. SaŽah
Posts: 21,798
Default "This fact may not sit well: Americans are under-taxed"

Quote:
[...]

This fact is separate from the politically charged questions of whether government spends too much, the fairness of who pays how much and what we value or don't in government spending. It's simply that our tax burden is low in the long view of U.S. history, and there are many ways to measure that central truth.

One way is to look at the trend of total federal revenues ... [...] Revenues plunged to around 15 percent of the economy in 2009 and 2010 amid the deep financial crisis, and dipped even further this year, to 14.4 percent, the lowest level since 1950.

Don't like that tax measure? Here's another:

Americans across all income classes paid lower effective tax rates in 2007, the last year of complete Internal Revenue Service data, than they did in 2000. The effective tax rate is what people pay after all exemptions and deductions. This is according to the most recent comprehensive look at taxes by the nonpartisan Congressional Budget Office.

The highest 20 percent of tax filers saw their total average federal effective tax rate fall from 28 percent in 2000 to 25.1 percent in 2007, according to the CBO. That's considerably lower than the current top marginal tax rate of 35 percent, and lower than the 27.5 percent effective rate in 1979, the first year that CBO data are available.

For the wealthiest 1 percent of filers, the effective tax rate fell from 33 percent in 2000 to 29.5 percent in 2007. The poorest 20 percent of filers saw their effective rate fall from 6.4 percent to 4 percent.

That's not to say the wealthy don't pay taxes — the top 1 percent paid 39.5 percent of all U.S. income taxes in 2007 — but taxes take a smaller share of their wealth today than historic post-World War II norms.

[...]

Still doubtful?

There's yet another way to gauge the tax burden, using data from the Commerce Department's Bureau of Economic Analysis that go back to 1929. The bureau's data on personal income make it possible to guess roughly what portion of income goes to the taxman.

Under this calculation Americans on average saw 17.3 percent of their income go to federal taxes in 2009 and 2010. The last time the percentage was this low was 1975, and during the late 1960s.

If you exclude social insurance taxes on wages — for Medicare and Social Security — the share of taxes as a percentage of income drops to 9.4 percent in 2009 and 9.3 percent in 2010, the lowest since 1950.

[...]
Read the whole thing.
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