As thousands of anti-tax protesters rallied across the nation yesterday and the president promised tax cuts for most, new data showed that the federal income tax burden is already hovering near its lowest level in three decades for all but the wealthiest Americans.The nonpartisan Congressional Budget Office estimates that the average family forked over barely 9 percent of its earnings to the IRS in 2006, the most recent year for which information is available. The effective tax rate hit its all-time low in 2003 and has since crept up only slightly.
The piece goes on to mention this Gallup graph that made the rounds yesterday showing that people are pretty comfortable with their current income tax burden:
I was curious to see how closely those attitudes matched actual changes in the income tax. The graph goes back to the 60s while the CBO data goes back to 1979, but here it is anyway:
Draw a line and the trends follow: Taxes rates drift down and so too do the number of poll respondents who think their burden is "too high." You see a small jump in tax unhappiness during the Clinton years which also coincided with a small bump in tax rates for upper-income folks. But worth noting is that this graph really doesn't coincide with electoral outcomes. In 1992, people are very happy with their tax burden but George H.W. Bush loses. In 1996, Clinton gets reelected. In 2000, tax unhappiness doesn't deprive Gore of the popular vote. In 2008, everyone loves their low tax burden but John McCain doesn't win the election. People don't like paying higher taxes, but it's unclear whether it actually matters on the electoral margin.
