Who Pays Taxes in America? America’s tax system as a whole is just barely progressive.

[웃 910]

Who Pays Taxes in America?

Read the PDF of this report.

It’s often claimed that the richest Americans pay a disproportionate share of taxes while those in the bottom half pay nothing. These claims ignore the many taxes that most Americans are subject to — federal payroll taxes, federal excise taxes, state and local taxes — and focus instead on just one tax, the federal personal income tax. The other taxes are mostly regressive, meaning they take a larger share of income from a poor or middle-income family than they take from a rich family.

[1]

Many Americans do not have enough income to owe federal personal income taxes, but do pay these other taxes. The federal personal income tax is a progressive tax, and the combination of this tax with the other (mostly regressive) taxes results in a tax system that is, overall, just barely progressive. Total tax obligations are, on average, fairly proportional to income.

This table illustrates the share of total taxes (all federal, state and local taxes) paid by Americans in different income groups in 2011.

• The share of total taxes paid by each income group is similar to that group’s share of total income.

• The share of total taxes paid by the richest one percent (21.6 percent) is almost identical to that group’s share of total income (21.0 percent).

• The total effective tax rate for the richest one percent (29.0 percent) is only about four percentage points higher than the total effective tax rate for the middle fifth of taxpayers (25.2 percent).

[2]

• The share of total taxes paid by the poorest fifth of Americans (2.1 percent) is only slightly less than this group’s share of total income (3.4 percent).

Virtually every person in America pays some type of tax. Everyone who works pays federal payroll taxes. Everyone who buys gasoline pays federal and state gas taxes. People who shop in stores pay the sales taxes that most state and local governments impose. State and local property taxes affect everyone who owns or rents a home. (Even renters pay property taxes because landlords pass some of the tax on to them in the form of higher rents). Most states also have income taxes, most of which are not particularly progressive.

Why the Federal Personal Income Tax Is Progressive

We need the federal personal income tax to be progressive to offset the regressive impacts of these other taxes.

For example, the federal personal income tax provides refundable tax credits like the Earned Income Tax Credit and the Child Tax Credit, which can reduce or eliminate personal income tax liability and even result in negative personal income tax liability, meaning families receive a check from the IRS. These tax credits are only available to taxpayers who work, and who therefore pay federal payroll taxes, not to mention the other taxes that disproportionately affect low- and middle-income Americans.

In other words, the parts of the federal personal income tax that seem like a boon to the poor are justified because they offset some of the other taxes that poor and middle-income families must pay.

As these figures illustrate, America’s tax system as a whole is just barely progressive.

http://ctj.org/ctjreports/2012/04/who_pays_taxes_in_america.php

[^_^ 5,021]

So we (almost completely by accident) have an almost-flat tax already!

[luckytxn 2,263]

Just take the riches money already. In fact lets have a 100% tax rate on the rich and start the legislation to confiscate their wealth. From when I last looked it will put a SMALL dent in the deficit. That will us people that actually work to pay the rest.

[웃 910]

Just take the riches money already. In fact lets have a 100% tax rate on the rich and start the legislation to confiscate their wealth. From when I last looked it will put a SMALL dent in the deficit. That will us people that actually work to pay the rest.

Get rid of Bush's Tax Cuts and you would immediately "shrink government (reduce deficits)" by, oh, about a half a trillion (with T) dollars each year from the budget. You know, fiscal conservatism, small government, manageable debts, all that...But there are no Republicans that are fiscally conservative, all fiscal conservatives are democrats!

"If Congress leaves current law unchanged, the report said, the deficit will fall to $585 billion in 2013 and $345 billion in 2014. In other words, doing nothing might be the most straightforward way for Congress to slash the deficit, a goal espoused by lawmakers in both parties. "

http://www.nytimes.com/2012/02/01/us/politics/deficit-tops-1-trillion-but-is-falling.html?_r=1&hp

Red Line = GOP policies

Green Line = Liberal policies

[luckytxn 2,263]

Get rid of Bush's Tax Cuts and you would immediately "shrink government (reduce deficits)" by, oh, about a half a trillion (with T) dollars each year from the budget. You know, fiscal conservatism, small government, manageable debts, all that...But there are no Republicans that are fiscally conservative, all fiscal conservatives are democrats!

"If Congress leaves current law unchanged, the report said, the deficit will fall to $585 billion in 2013 and $345 billion in 2014. In other words, doing nothing might be the most straightforward way for Congress to slash the deficit, a goal espoused by lawmakers in both parties. "

http://www.nytimes.c...ng.html?_r=1

Red Line = GOP policies

Green Line = Liberal policies

Like I said before. US middle class will need to pay for the non paying. Or here is something radical. Stop spending more than we take in.

[Neonred 3,446]

Like I said before. US middle class will need to pay for the non paying. Or here is something radical. Stop spending more than we take in.

Fiscal conservative democrats don't understand this concept.

[luckytxn 2,263]

Fiscal conservative democrats don't understand this concept.

Neither do the Socially Conservative Republicans.

[Neonred 3,446]

Who Pays Taxes in America?

SUMMARY OF FEDERAL INDIVIDUAL INCOME TAX DATA, 2010

Looks like your source is a little biased.

[Neonred 3,446]

Neither do the Socially Conservative Republicans.

True. Nobody in DC is willing to do the right thing. Might hurt their chances of being reelected.

[Obama 2012 1,714]

Oh here we go. Idiocy in this thread yet again on trying to argue that taxes have anything to do with creating debt...

It's the SPENDING stupid.

[mawilson 2,133]

How nice of them to split the last 20% into 4 groups to make their total share of taxes paid look smaller.

Here's what it should look like:

[Mr. Big Dog 10,747]

How nice of them to split the last 20% into 4 groups to make their total share of taxes paid look smaller.

Here's what it should look like:

That's still barely progressive.

[^_^ 5,021]

That's still barely progressive.

That is an objection that registers only with those who consider progressive to be a desirable paradigm for how we raise our tax revenues.

For many (most?) in this thread, it is not.

Silly lib.

[luckytxn 2,263]

That's still barely progressive.

How? Who is already paying most of the taxes?

[mawilson 2,133]

So we (almost completely by accident) have an almost-flat tax already!

Federal taxes are stupidly progressive (half the country is not paying anything at all, the average effective tax rate is something like 10% and those at the top pay 20-30%).

I'm guessing what makes the total look flat are the sales tax and state/local taxes (also flat in many states).