The Importance of Income and Outflow

Every year, the American people spend about $30 billion on accountants and software to file their taxes. That's on top of taxes themselves. Approximately 26 percent of the average American's income is collected, in some form or another, in taxes. This includes all forms of taxation, such as state and local taxes, as well as federal. If we look at just federal taxation, that still comes to a very respectable 16 to 18 percent (on average) of GDP. But how does that all break down when it comes to federal taxation? Are the poor really getting bent over the taxation barrel every April? Are the rich not really paying their "fair share"? And how did we even get to this point? Join Antony Davies and James Harrigan as they discuss this and more on this week's Tax Day edition of Words and Numbers.

The top 1% earn 20% of all income but pay almost 40% of all federal taxes.

https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/51361-householdincomefedtaxesonecol.pdf

Country comparison of tax revenue from all levels of government per GDP

US = 26%; Denmark = 45%; Ireland = 22%.

This ignores borrowing. If government taxed enough to balance budget, US would be at 31%, putting it on par with Canada.

http://www.taxpolicycenter.org/briefing-book/how-do-us-taxes-compare-internationally

Overview of federal taxes

https://files.taxfoundation.org/20170201091804/TaxFoundation-FF540.pdf

60% of US households receive more money back from the federal government than they pay

https://taxfoundation.org/60-percent-households-now-receive-more-transfer-income-they-pay-taxes/

How taxes and transfers trap the poor

https://mises.org/library/dead-zone-implicit-marginal-tax-rate

The income tax was originally a tax on the rich.

https://www.usnews.com/opinion/articles/2016-10-05/income-tax-history-is-a-warning-about-our-future-under-clintons-estate-tax

Number of pages in the Standard Federal Tax Reporter

https://taxfoundation.org/how-many-words-are-tax-code/

Fun tax facts

https://www.factretriever.com/taxes-facts

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