Taxes

Evil Bush Tax Rates Made Rich Bastards Pay More Taxes!

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For all the yammering about the wisdom or tragedy of extending Bush-era tax rates, precious little hot air has been expended on, like, looking at what effects the goddamn things had on who paid how much tax. Back during the 2008 election, Joe Biden used to say that it was "patriotic" to ask the rich to pay "their fair share" in taxes. What that widely repeated nostrum misses is that the rich (however defined) have been paying a greater share of income taxes in the aughts.

Below is a chart from the Tax Foundation that lists the percent of federal income tax paid by each income group. Whatever else you want to say about the Bush tax rates, they made the wealthy pony up more of the whole.

In 2000, for instance, the top 1 percent of income earners paid 37.42 percent of all income taxes collected. In 2008, they paid 38.02 percent. That's down a bit from the peak of 2007 and reflects the recession hitting. The bottom 50 percent of filers saw their share of the income tax burden fall from 3.91 percent to 2.7 percent. Two groups in the upper half of the income distribution made out, it seems: Folks coming in between between 10 percent and 25 percent of income and those between 25 percent and 50 percent. Each saw their share of total tax collected decline a bit (like the share of taxes paid, this reflects the recession).

The Clinton rates in force between 1993-2000 similarly increased the total income tax share paid by the wealthiest tax filers. Both decades also saw general increases in the adjusted gross income (AGI) share, or percent of total AGI, among wealthier groups. In 2008, however, many of the top income groups saw their share of total AGI decline for the first time since 2001.

More background: Between 1993-2000, the U.S. had five income-tax brackets, ranging from 15 percent to 39.6 percent. Since 2003, when the compleat Bush tax rates came into play, there have been six brackets, ranging from 10 percent to 35 percent. 

In 2000, you were in the top 1 percent of income earners if your AGI was $313,000 or more; you were in the top 5 percent if your AGI was $128,000 or more; you were in the top 50 percent with an AGI of $28,00. In 2008, the comparable AGIs were $380,000, $161,000, and $33,000 (all figures in nominal dollars).

Percent of Federal Income Tax Paid by Each Group

Year              Top .01 Top 1%   Top 5%   5-10%   Top 10% 10-25%  Top 25% 25-50%  Top 50% Bot 50%

2000 37.42% 56.47% 10.86% 67.33% 16.68% 84.01% 12.08% 96.09% 3.91%
2001 16.06% 33.89% 53.25% 11.64% 64.89% 18.01% 82.90% 13.13% 96.03% 3.97%
2002 15.43% 33.71% 53.80% 11.94% 65.73% 18.16% 83.90% 12.60% 96.50% 3.50%
2003 15.68% 34.27% 54.36% 11.48% 65.84% 18.04% 83.88% 12.65% 96.54% 3.46%
2004 17.44% 36.89% 57.13% 11.07% 68.19% 16.67% 84.86% 11.85% 96.70% 3.30%
2005 19.26% 39.38% 59.67% 10.63% 70.30% 15.69% 85.99% 10.94% 96.93% 3.07%
2006 19.56% 39.89% 60.14% 10.65% 70.79% 15.47% 86.27% 10.75% 97.01% 2.99%
2007 20.19% 40.41% 60.61% 10.59% 71.20% 15.37% 86.57% 10.54% 97.11% 2.89%
2008 18.47% 38.02% 58.72% 11.22% 69.94% 16.40% 86.34% 10.96% 97.30% 2.70%