FOR IMMEDIATE RELEASE
Latest IRS Tax Collections Data (2005 Tax Year) Dispels the Myth that the Rich Don’t Pay Tax
With little fanfare, the IRS has published the latest version of one of their most revealing data sets; the collections data by percentile, for the 2005 tax year, which shows conclusively that the wealthy pay far more in taxes, per dollar earned, than the poor or middle class.
Houston, Texas (ActionAmerica.org) October 4, 2007 – Today, the IRS released their annual Tax Collections Data by Percentile and as in previous years, this report (for the 2005 tax year) totally dispels the popular myth that the rich don’t pay tax. This collections report, broken down by income category or “percentiles,” shows that while the top earning five percent of income earners only earn just over a third (36%) of all income, they pay almost two-thirds (60%) of the tax that is actually collected.
2005 IRS Collections Data (source IRS)Returns (000) |
(000,000) |
Taxes Paid (000,000) |
Share of Total AGI |
Share of Total Taxes |
Avg. Tax Rate (%) |
Floor for Group |
|
| All Taxpayers |
132,612 |
7,507,958 |
934,703 |
100.00 |
100.00 |
12.45 |
(NA) |
| Top 1% | 1,326 |
1,591,711 |
368,132 |
21.20 |
39.38 |
23.13 |
364,657 |
| Top 5% | 6,631 |
2,683,934 |
557,759 |
35.75 |
59.67 |
20.78 |
145,283 |
| Top 10% | 13,261 |
3,487,010 |
657,085 |
46.44 |
70.30 |
18.84 |
103,912 |
| Top 25% | 33,153 |
5,069,455 |
803,772 |
67.52 |
85.99 |
15.86 |
62,068 |
| Top 50% | 66,306 |
6,544,824 |
906,028 |
87.17 |
96.93 |
13.84 |
30,881 |
| Bottom 50% | 66,306 |
963,134 |
28,675 |
12.83 |
3.07 |
* 2.98 |
(NA) |
Every year, between September and February, the IRS very quietly releases the most recent information (about two years old) concerning its tax collections, based on income category or "percentiles." In order to keep this important information from being lost, among the volumes of inconsequential data released by the IRS each year, ActionAmerica.org, watches for the release of this data. As soon as it becomes available, the most recent data is reprinted in an easy to read format, along with links to the source data, followed by an announcement of the availability of this crucial information that decisively shatters several popular myths.
John Gaver, Editor of ActionAmerica.org points out that, “This data contains no assumptions of any kind, no massaged projections, spin or other bias. Rather, it represents monies actually collected by the IRS, broken down by income group, for the given tax years. You can't get more unbiased than that.” It takes about two years for the IRS to compile this data, so this year, the new numbers are for the 2005 tax year.
In that year, there were 132.6 million returns filed, representing a total of $7.508 trillion dollars in AGI and $934.7 billion dollars in taxes collected. Out of that, the most reviled taxpayers – the wealthiest 1% of income earners (those who earned more than $364,657) – paid $368.1 billion in taxes or roughly 40% of the tax load, while only earning 21% of the income. This translates to almost double their share of taxes, based upon income earned.
“This is interesting,” said Gaver “in that it totally dispels the popular myths that there are so many loopholes in the tax code that the rich don’t pay taxes and that the Bush tax cuts benefited only the rich. In fact, it clearly demonstrates that our most productive citizens are paying a heavy price for their success and despite what some politicos will have you believe, it became even worse, after the Bush tax cuts. Is it any wonder why so many wealthy Americans are moving themselves and their money offshore?”
The most relevant benchmark of tax load is the "tax load ratio," defined as the ratio of percent of total income earned, to the percent of total tax paid, by each income group. That ratio, for the top-earning 1% of income earners, has been higher in each of the first four years of the Bush Administration, than in any of the last four years of the Clinton Administration, completely dispelling any illusion that the Bush tax cuts benefited the rich.
In 2005 that ratio dropped somewhat. But, it is still much higher than when Bush took office. Regardless of how some politicians and pundits may try to spin the data, it should be clear that when one pays an increasing amount of the total tax load, based upon his share of income earned, it amounts to a tax increase.
For additional information on IRS collections data by percentile, contact John Gaver or see the ActionAmerica.org article, “1986-2005 IRS Collections Data by Income Category (Percentile)”, at http://www.ActionAmerica.org/taxecon/irsdata.shtml.
ActionAmerica.org is a popular, non-profit, conservative/libertarian webzine, known for its uncompromising stand for original intent of the Constitution, the Rule of Law and for fiscal conservatism. ActionAmerica.org is also known for being a long term, outspoken supporter of the FAIR Tax, as the only responsible, fair and revenue neutral replacement for the income tax and IRS.
Contact:
John Gaver
Editor & Publisher
ActionAmerica.org
(281) 354-4888
http://www.ActionAmerica.org/feedback.shtml
