The Cato Institute points to a recent study that aggregates recent IRS Income Tax data:
Tax rates on those with high incomes are far greater than for other Americans. Folks at the top pay about 25% of their income in federal income taxes, which compares to less than 5% for half of the population at the bottom end.
For the top two groups, the tax rate in 2005 was about the same as 1990. Essentially, the Bush tax cuts just reversed out the Clinton tax increases on these folks.
The Bush tax cuts substantially reduced tax rates for people in every income group. Indeed, those at the bottom had the largest relative reductions in their tax rates.
Those at the bottom have paid little, and now they pay even less, due to legislation under both Clinton and Bush. Indeed, these data do not include the tens of billions of dollars sent to lower-income families as a result of the earned income tax credit, and thus it overstates taxes paid by the bottom group.
Democrats (*cough* John Edwards) like to blow a lot of hot air about how the rich don't pay their fair share, but the data clearly shows that's not the case. Not only has the deficit fallen as a result of the Bush tax cuts, but the tax distribution still weighs heaviest on the upper echelons of America.
It looks about right to me.
Hat tip:
Greg Mankiw
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