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July 16, 2007
Taxes Then and Now

I've been in a couple recent discussions about income taxes with some random folks recently, and the people I've talked to all seem to believe that under the Bush administration either the taxes have increased, or that taxes have been reduced only for the wealthy, or that taxes for the wealthy have been reduced while the taxes for the poor have increased.

Of course this is an easy one to check out as the tables are readily available at the IRS web site.

Here's the income tax from the IRS 1040 Tax Table, filing single. I've choosen the years 1998 and 2006, because the former is positioned six years into the eight-year Clinton administration and the latter is positioned six years into the eight-year Bush administration.

1998 Tax2006 TaxPercent
$ 10,000$ 1,504.00$ 1,126.00-25.1 %
20,000 3,004.00 2,626.00-12.6 %
30,000 5,112.00 4,126.00-19.3 %
40,000 7,912.00 6,564.00-17.0 %
50,000 10,712.00 9,064.00-15.4 %
60,000 13,512.00 11,564.00-14.4 %
70,000 16,570.00 14,064.00-15.1 %
80,000 19,670.00 16,739.00-14.9 %
90,000 22,770.00 19,539.00-14.2 %
100,000 25,855.00 22,325.00-13.6 %

Note that all the tax rates have gone down, and the average reduction is 16.16% (!!!).  That's quite significant.  And with respect to the present day, the tax rates used to be an average of 19.27% higher.  The greatest reduction was for the lowest income level, where the income tax used to be 33.51% higher.

And note that the four largest tax rate reductions are at the five lowest income levels.

(What's with the glitch at $20,000.00? Probably a correction; the 1998 tax rate at $20,000.00 was already the lowest rate of these numbers, lower than the $10,000.00 rate.)

Actual taxes will be even less today because of things like the child tax credits, which GWB introduced.

So yeah, income taxes are significantly reduced over the last eight years, they're reduced more for the poor than the wealthy, and it's a very good thing...  And, of course, most people will believe the exact opposite.

Posted by DonTillman at July 16, 2007 09:18 PM

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