For the past several years Americans have been subjected to an argument that the Bush tax cuts benefited only the rich. The underlying point is that these tax cuts need to be reversed because they're not fair and more importantly, the economy performed better under Clinton and therefore we should turn back the clock and put in place the same tax scheme in order to mimic the Clinton economy. Well, the Congressional Budget Office (CBO) recently released the official numbers that thoroughly and utterly blow that argument out of the water. Clearly, the Bush tax cuts helped lower-income earners most.
They report the following:
According to a report issued by the Congressional Budget Office (CBO), the tax cuts significantly increased the share of federal income taxes paid by the highest-earning 20 percent of households compared to their levels in 2000, President Clinton’s final year in office.
In 2006, the latest available year from CBO, the top 20 percent of income earners paid 86.3 percent of all federal income taxes, an all-time high. This is an increase of over 6 percent from 2000, when the top 20 percent paid 81.2 percent. During the same period, the bottom four quintiles all saw their share of the federal income tax burden fall sharply:
- The bottom 20 percent of income earners' share of federal income taxes fell from –1.6 percent in 2000 to –2.8 percent in 2006;
- The next 20 percent's share declined from 1.1 percent to –0.8 percent;
- The middle quintile's share dropped from 5.7 percent to 4.4 percent; and
- The fourth quintile's share decreased from 13.5 percent to 12.9 percent.
Each of these four quintiles' shares was an all-time low.
Read the post from Political Crunch
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