Wednesday, July 15, 2009

Regressive Payroll Tax Continues to Take Share

The Treasury Department recently reported that, over the 12 months July 2008-June 2009, it got pretty close to the same revenue from the Individual Income Tax as from the Payroll Tax:

IIT: $954 billion
payroll: $855 billion

This by itself makes the tax system more regressive (less "progressive"). It is possible that some of the individual income tax "surcharges" proposed for the rich would only bring the overall tax system regressivity back to where it was a year or two ago?

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