Showing posts with label taxes. Show all posts
Showing posts with label taxes. Show all posts

Wednesday, October 5, 2011

How progressive is the U.S. federal tax code?

Greg Mankiw posted this link a few weeks ago, in the middle of the discussion started again by Warren Buffett, which shows how progressive the U.S. federal tax code is, and the breakdown into different tax categories.  The numbers the Urban Institute/Brookings Tax Policy Center.  They don't make explicit all of the necessary tax incidence assumptions behind these numbers, but there is enough consensus on those that it is probably not a source of controversy.


There are a number of tax misconceptions that we could correct with these numbers.  One is that the super rich pay less in taxes than the middle class or moderately wealthy.  On average, this is not true, even if we look only at the income tax.  The regressive nature of the payroll tax is also made explicit here, which is interesting, and the incidence and small magnitude of the estate tax is also worth noting.