Inversions have been in the news consistently this summer as multiple companies have looked for legal paths away from the U.S. corporate tax system. Burger King became the latest corporation to add to the list after they...
- Generational Equity: Which Age Groups Pay More Tax, and W...
Generational Equity: Which Age Groups Pay More Tax, and Which Receive More Government Spending?
Special Report No. 156
Do some age groups in America get a better deal from government than others? As America's growing number of retirees strains the nation's fiscal system, that question has become more important than ever. While many studies explore the fairness of taxes and government spending across income groups, few studies explore the distribution of tax burdens and government spending across age groups in the United States.
• As the Baby Boom generation prepares to retire, lawmakers should be aware of the distribution of taxes and government spending across age groups.
• America's youngest households aged 25 and under received $2.32 in government spending for each dollar of taxes paid in 2004. Middle-aged households aged 45 to 54 received $0.73 per tax dollar, and America's oldest households aged 75 and over received $4.93 per dollar of taxes paid;
• As a group, households aged 35 to 64 pay more in taxes than they receive in government spending, while households under age 35 and over age 64 receive more government spending than they pay in taxes. Overall between $376 billion and $872 billion per year is fiscally transferred from middle-aged groups to the youngest and oldest Americans each year through government taxes and spending;
• Over a lifetime, government spending follows a U-shaped pattern, with large education and welfare spending in youth and large Social Security and Medicare payments in old age. But even within each age group, there are large differences in taxes and government spending across households at different income levels.
- The United States has the third highest general top marginal corporate income tax rate in the world at 39.1 percent, exceeded only by Chad and the United Arab Emirates.
- The worldwide average top corporate...
- IRS income data is collected in order to raise revenue as directed by Congress, which means it is not necessarily well-suited for other purposes, like measuring equality in our society.
- The average taxpayer’s...
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