Wednesday, April 20, 2011

Only The Poor Pay Taxes

link heerto article

The alleged quote from the wife of billionaire who was told that she owed the IRS some tax revenue is not true. What is true, however, is that income has been growing rapidly for the richest Americans and much slower for ordinary Americans. At the same time, the effective tax rate for the richest Americans has dropped substantially. Effectively, our government has been using tax policy to redistribute income to the super rich since the Reagan administration. This article is loaded with graphs that illustrate the effect of changes in tax policy on after tax income and the uneven growth in income since the 1980's.

Given the changes in tax policy, it is not surprising that the nation with the lowest tax rates in the industrial world should have fiscal problems, especially in an economic downturn. The good news is that there is plenty of room for growth in tax revenues in the US.

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