Wednesday, July 30, 2008

Tax Cuts For the Rich

The Tax Foundation has summarized the latest data from the IRS regarding individual income taxes.  Read their report here.

A few highlights to whet your appetite:

Table 6
Total Income Tax Shares, 1980-2006
(Percent of federal income tax paid by each group)

 

Year Top 1% Top 5% Top 10% Bottom 50%
1980 19.05% 36.84% 49.28% 7.05%
2006 39.89% 60.14% 70.79% 2.99%

Yes, you're reading that right. The top 1% of taxpayers now pay twice as much of the entire tax revenue than they did in 1980. For the top 5% the results are similar, and the top 10%'s tax burden grew by 40%.  Meanwhile the tax burden of the bottom 50% fell to below 3%

So, can we dispense with the nonsense of talking about "tax cuts for the rich"? We'd have to slice their taxes by ridiculous amounts to even get to 1980 levels. The reason why the bottom 50% rarely receive tax breaks isn't because evil Republicans are trying to benefit their rich friends. It's much simpler.  They don't pay taxes. You can't give a tax cut to someone who doesn't pay taxes already. Ok, so you can, and we do, but that's a discussion for another time.

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