One Chart That Describes Our Unequal Tax System

A chart in the President's Report On The Economy has attracted the attention of those familiar with the tax system. They point out that the chart shows that US tax policy violates two rules that are used to evaluate tax policy. US tax policy violates the rule of equity which has been used since Adam Smith which is based upon the ability to pay theory. That is, those with higher incomes should have a higher tax rate. It also violates the rule of horizontal equity. That is, that those with equal income should be taxed at the same rate.