Congratulations! You’ve paid your taxes!
May 1st, 2007 | by mbhunter |Yesterday, April 30th, 2007, was Tax Freedom Day for 2007 in the US. I hadn’t heard of this until Five Cent Nickel posted about it over here. Tax Freedom Day is the day of the year that the average American has earned enough to cover his or her federal, state, and local tax burden for the year.
Nickel posted a graph from the TaxFoundation.org website that plots Tax Freedom Day from 1982 to 2007:
The spread of Tax Freedom Days, over 25 years and three recessions, was only two and half weeks: April 18th to May 5th. This year’s, April 30th, was a little on the high end of this spread, but not by that much.
There was another figure on that same web page that showed Tax Freedom Day for each decade in the 20th century. If I just superpose the data from the chart above and the table going further back — and disregard any discrepancies in methodology or calculation — this is what we get:
Quite a different picture, no? Tax Freedom Day in 1910 was January 19th: less than three weeks into the year. Now, Tax Freedom Day is more than three months into the year! Granted, there could be differences in methodology between the early data points (1980 and before) and the later ones, but I suspect the trend would be the same — up.
I’m sure there could be all kinds of discussion as to why we pay about five times more tax, as a fraction of our income, than we did 100 years ago. The credibility of Tax Freedom Day is even dismissed by some. I’m not sure, though, why The Tax Foundation plots only the past 25 years on the graph. Whatever the reason, there seems to be more to the story if you look back further.
(Note: Today is Free iPod Day over at Five Cent Nickel, aka his 2nd blogaversary giveaway! So go over there and reduce my chances of getting one of those iPods!)
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