Under Obama the “Rich” Would Pay More than Half of All Taxes

August 17, 2008

New analysis of Barack Obama's tax plan by the Tax Policy Center puts a hard number on the extent in which Obama would shift the nation's tax burden on to the so-called rich. Obama has been very clear that he would increase taxes on couples earning more than $250,000 (and singles earning more than $200,000) while cutting taxes for all other households.

Obama's rhetoric gives the impression that middle-class taxpayers are paying a greater share of the tax burden than upper-income households and that his plan would correct this inequity. However, the reality is the 122.7 million taxpayers earning between $0 and $100,000 pay a collective 29 percent of all federal taxes while the 7.1 million taxpayers earning over $200,000 collectively pay 45.5 percent of the federal tax burden. Apparently Obama is not content with that ratio.

According to Tax Policy Center estimates, Obama's plan would increase the burden on wealthy households by 5.9 percentage points while lowering the burden on those earning less than $100,000 by 4.3 percentage points. As a result, Obama would have wealthy households shoulder more than 51 percent of the federal tax burden while cutting the burden on the "middle-class" to less than 25 percent. In other words, Obama believes that the wealthy's proper share of the federal tax burden is twice that of the middle-class.

Two questions for Mr. Obama:

1. How is the economy expected to grow when the most productive people in America are expected to shoulder more than 50 percent of the nation's tax burden?
2. Is it healthy for our democracy to have the vast majority of Americans contribute so little to the cost of government yet enjoy all the benefits of it?

Cash Income Level (thousands of 2008 dollars)

Current Share of Total Federal Taxes (%)

Share of Total Federal Taxes Under Obama Plan (%)

Change (%)

Less than 10

0.2

-0.1

-0.3

10-20

0.7

0.0

-0.7

20-30

1.9

1.2

-0.7

30-40

2.8

2.2

-0.6

40-50

3.5

3.0

-0.5

50-75

10.0

9.1

-0.9

75-100

10.1

9.4

-0.7

100-200

25.3

23.7

-1.6

200-500

17.5

17.3

-0.2

500-1,000

7.5

8.6

1.1

More than 1,000

20.5

25.5

4.9

All

100.0

100.0

0.0

$0 to $100

29.2

24.8

-4.3

$100 to $200

25.3

23.7

-1.6

Above $200

45.5

51.3

5.9

Source: http://www.taxpolicycenter.org/numbers/displayatab.cfm?Docid=1967&DocTypeID=1


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