Rich Pay More Than “fair share”

July 19, 2012 04:52


40% of Americans received more in refundable tax credits than they paid in income taxes.

 

By Mark J. Perry at Carpe Diem

 

 

The chart above is based on data in the recently-released CBO report “Distribution of Household Income and Federal Taxes, 2008 and 2009,” showing the share of federal income taxes paid by income group in 2009.  In 2009, almost all (94.1%) federal income taxes collected were paid by just one-fifth of Americans (top quintile) and the top 1% paid almost 39% of all taxes collected.  In contrast, the lowest and second quintiles were net “tax collectors” because that 40% of Americans received more in refundable tax credits than they paid in income taxes.

But all we hear about is how the rich don’t pay their fair share of taxes, and proposals for increasing taxes on “the rich,” like the one from Warren Buffett discussed here.

 

Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota.  He blogs at Carpe Diem.


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