off the charts
POLICY INSIGHT
BEYOND THE NUMBERS
BEYOND THE NUMBERS
Top Ten Federal Tax Charts
In recognition of Tax Day, we’ve collected our top ten charts related to federal taxes. Together, they provide useful context for the coming debates about how to reduce soaring budget deficits and reform the tax code.
Our first chart, below, reminds us what taxes pay for: three-fifths of federal spending goes for national defense, Social Security, and major health programs like Medicare and Medicaid; the rest goes for safety net programs, interest on the debt, and a wide variety of other areas.
Our second chart, below, shows that the United States (including both the federal government and the states) collects less in taxes as a share of the economy than nearly any other developed country.
The next three charts show some of the factors that have made the United States a low-tax country. They include the downward trend in taxes on middle-income families, the steep drop in federal taxes at the top of the income scale, and the decline in corporate income tax revenue as a share of the economy.
As our third chart, below, shows, federal taxes on middle-income Americans are near historic lows, according to data from the Urban-Brookings Tax Policy Center (TPC):
- A family of four in the exact middle of the income spectrum will pay only 5.6 percent of its 2011 income in federal income taxes; and
- Average federal income tax rates for this middle-income family have been lower during the Bush and Obama Administrations than at any time since the 1950s.
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