Rich Pay More, Poor Pay Less Taxes
According to tax return data released this week by the IRS (data above are from Table 5), the share of federal income taxes paid by the top 5% of taxpayers reached a 19-year high of 57% in 2004 (see bottom graph above). During the same period, the share of income taxes paid by the bottom 50% of taxpayers reached a 19-year low of 3.3% in 2004, compared to 6.5% in 1986 (see top graph above). Note: Federal income taxes include taxes on salary and wages, dividend and interest income, and income from capital gains.
Measured by the share of federal income taxes paid, the 2003 tax reform was a "tax cut for the poor" and a "tax hike for the rich."
BTW, the Democrats on the Senate Budget Committee just muscled through a budget bill on a party-line 12-11 vote this afternoon that would pretty much guarantee the demise of Bush's tax cuts, which expire at the end of 2010.