Tax Cut Facts

Conn Carroll / March 04, 2008

Since the economy is set to be a key issue in the general election, tax policy will be a major point of departure for the two eventual nominees. Both leading Democrats have pledged to end the Bush tax cuts arguing that they only benefited upper income tax payers and that they also starved the government of needed revenue. Both arguments are false.

On the wealthy’s share of the tax burden Heritage Foundation Center for Data Analysis director Bill Beach notes:

The top five percent of income earners paid 59.7% of all income taxes in 2005, which was the highest percentage in the past 20 years. Tax share records were also set by the top 10, top 25 and top 50% of income earners. In other words, every category of high income taxpayer as defined by the IRS paid a higher share of taxes in 2005 than they have since 1986, the earliest date for which the IRS provides data.

On government revenues since the 2001 tax cuts Beach points out: (more…)