THE SMALLEST TAX BURDEN IN GENERATIONS…. If I had to guess, I’d say most Americans think the government collects too much money in taxes. Indeed, despite an enormous deficit they claim to care deeply about, congressional Republicans are nearly unanimous in their belief that raising any taxes on anyone by any amount is entirely unacceptable — because Americans are “taxed enough already.”
With that in mind, today’s AP report on tax burdens probably won’t be well received on the right, but that doesn’t make it wrong. (thanks to reader R.S. for the tip)
Taxes too high?
Actually, as a share of the nation’s economy, Uncle Sam’s take this year will be the lowest since 1950, when the Korean War was just getting under way.
And for the third straight year, American families and businesses will pay less in federal taxes than they did under former President George W. Bush, thanks to a weak economy and a growing number of tax breaks for the wealthy and poor alike.
Income tax payments this year will be nearly 13 percent lower than they were in 2008, the last full year of the Bush presidency. Corporate taxes will be lower by a third, according to projections by the nonpartisan Congressional Budget Office.
There are multiple factors that contribute to this, including the weak economy that holds down income. But it’s also the result of very low tax rates, coupled with, as the AP noted, “a tax code that grows each year with new deductions, credits and exemptions.”
The result is an economy with federal tax receipts equal to just 14.8% of the economy — the lowest level since the Truman era.
Of course, this is only looking at federal taxes, and doesn’t reflect state and local taxes, but a USA Today analysis found last year that if we include everything — federal, state, and local taxes, including income, property, sales, and other taxes — the percentage of personal income that’s paid in taxes is still at its lowest level since 1950.
As Michael Ettlinger, head of economic policy at the Center for American Progress, said at the time, “The idea that taxes are high right now is pretty much nuts.”