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Poor and Stupid

How big government, big business, big media and big academia block your road to financial freedom- and tell you it's for your own good.

Tax Truth

Posted on 10/12/2007 18:52 PM | Link | Post Comment
Here's Chris Edwards at Cato on how the Bush tax cuts have affected the taxes paid by various income groups. Truth is stranger than Leftist fiction, eh?

For the top two groups, the tax rate in 2005 was about the same as 1990. Essentially, the Bush tax cuts just reversed out the Clinton tax increases on these folks.

The Bush tax cuts substantially reduced tax rates for people in every income group. Indeed, those at the bottom had the largest relative reductions in their tax rates.

This is a little wonky, but let?s compare average tax rates in 2000 to 2005. For the top group, the rate fell from 27.45% to 23.13%, a reduction of 16%.

Now consider the middle-income ?top 26-50%? group, for example. Their tax rate fell from 9.28% to 6.93%, a reduction of 25%.

Those at the bottom have paid little, and now they pay even less, due to legislation under both Clinton and Bush. Indeed, these data do not include the tens of billions of dollars sent to lower-income families as a result of the earned income tax credit, and thus it overstates taxes paid by the bottom group.

I?m for lower taxes for everyone, but I wish people would look at the actual data first before carping about the rich supposedly being specially favored by recent tax cuts.

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