The Wall Street Journal reports:
As President Barack Obama pushes to raise income taxes on high earners, opponents are seizing on data that indicates these U.S. households already pay a large and growing share of taxes, even compared with high-tax European countries. And a new congressional study concludes that the percentage of U.S. households owing no federal income tax climbed to 51% for 2009. [...]
"Most taxpayers are skeptical that the answer to our fiscal problems is for them to sacrifice more, when more than half of all households are not paying any income taxes and an increasingly smaller group of Americans is shouldering the burdens for an increasing larger group of Americans," said Sen. Orrin Hatch of Utah, the top Republican on the Senate Finance Committee.
Of course, this comes with important caveats. First, as the Journal points out, from 1979 to 2007, "The share of pre-tax income rose only for the top 20 percent and above," from 45.5 percent to 55.9 percent. Given high income growth among the rich -- and income stagnation or decline among everyone else -- it's only natural that they would pay a growing share of federal taxes. Overall, however, the rich are enjoying historically low average tax rates; as this figure shows, average rates for the top 1 percent of households have dropped from 37 percent in 1979 to 29.5 percent in 2007:
Ethan Pollack and Rebecca Thiess offer more context, "Between 1992 and 2007, a time in which income for the average household and top one percent grew 13% and 123%, respectively, the income for the top 400 households grew fully 399%." The rich have been the overwhelming beneficiaries of recent economic growth, and to me, at least, this is a sign that they need to begin paying their fair share.
