Fair taxes? Most now think so

posted by Brian Mudd -

lot's changed in a year. It's the first time in a long time we think we're not being overtaxed by Uncle Sam 

Bottom Line: With Tax Day behind us we have a bunch of new info on how we feel about how we're being taxed by the federal government. We won't know until about this time next year what the actual impact of the new tax law will be, but our perceptions have certainly improved. We've had research from Gallup every year since 1956 on our perceptions of our federal income taxes. As we put the old tax code behind us which, will result in approximately 4% of people needing to itemize compared to about 32% currently, we feel the tax code is about the fairest it's ever been (despite what the media narrative may be).  

For just the third time since 1956 more Americans think the federal income tax they're having to pay is fair than not. A year ago, at tax time 51% of Americans thought their federal income tax burden was too high with just 42% believing it was fair. Now 48% of Americans feel their burden is fair compared to 45% who feel it's too much. The only time more Americans felt their burden was fair was in 2001 in the immediate aftermath of the Bush-era tax cuts passing. What's also notable is how many people remain generally ignorant of the net-net of what they're really paying in federal income tax. According to the most recent IRS data 

  • 45% pay no federal income tax 

The top 20% of income earners paid 69% of all federal income taxes. So ironically last year when 45% of Americans paid no federal income tax (with around 41% profiting off of the tax code), just 42% thought it was fair. More than anything it's crystal clear that most Americans remain confused about what they're really paying. This is doubtless part of the reason the media manipulation to convince many Americans that they'd fare worse under Trump's tax policy (which benefits the average full-time employed person by about $1800 this year). There are two sides to stories and one side to facts. Federal withholding has long confused the masses about the facts of taxes they pay, or don't as the case may be. Something tells me Americans would be far more informed if they had to pay taxes like other bills monthly, rather than having the government confiscating it for us. In any event the changes in paychecks has evidently been enough to make the average person content with what they're paying in federal taxes going forward.  

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