Tax Rates Lower Under Obama Than Reagan

Many on the right act as if the Reagan years were a golden age of small government and low taxes while Barack Obama has brought us socialism and high taxes. Of course these are the same people who are certain Obama raised their taxes when he actually lowered them. Taxes are lower under Obama than under Ronald Reagan:

But in fact, most Americans in 2010 paid far less in total taxes — federal, state and local — than they would have paid 30 years ago. According to an analysis by The New York Times, the combination of all income taxes, sales taxes and property taxes took a smaller share of their income than it took from households with the same inflation-adjusted income in 1980.

Households earning more than $200,000 benefited from the largest percentage declines in total taxation as a share of income. Middle-income households benefited, too. More than 85 percent of households with earnings above $25,000 paid less in total taxes than comparable households in 1980.

Lower-income households, however, saved little or nothing. Many pay no federal income taxes, but they do pay a range of other levies, like federal payroll taxes, state sales taxes and local property taxes. Only about half of taxpaying households with incomes below $25,000 paid less in 2010.

The uneven decline is a result of two trends. Congress cut federal taxation at every income level over the last 30 years. State and local taxes, meanwhile, increased for most Americans. Those taxes generally take a larger share of income from those who make less, so the increases offset more and more of the federal savings at lower levels of income.

The article later gave a few examples:

¶A household making $350,000 in 2010, roughly the cutoff for the top 1 percent, on average paid 42.1 percent of its income in taxes, compared with 49 percent for a household with the same inflation-adjusted income in 1980 — a savings of about $24,100.

¶A household making $52,000 in 2010, roughly the median income, on average paid 27.7 percent of its income in taxes, compared with 30.5 percent in 1980, saving $1,500.

¶A household making $22,000 in 2010 — roughly the federal poverty line for a family of four — on average paid 19.4 percent in taxes, compared with 20.2 percent, saving $200.

The comparisons would be less dramatic depending upon which year of the Reagan administration current rates were compared to as Reagan both lowered and raised taxes during his time in office. The numbers do debunk any idea that Obama has ushered in an era of high-tax socialism. That’s why the right wing is so violently against numbers, arithmetic, and facts.

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  1. 1
    M says:

    Wow. 2010? That’s bush tax cuts not Obama. Lets talk 2013, 2014,etc!!!

  2. 2
    Syed Haider says:

    Tax Rates Lower Under Obama Than Reagan

  3. 3
    Andreas Schlüter says:

    Tax Rates Lower Under Obama Than Reagan

  4. 4
    Andreas Schlüter says:

    Tax Rates Lower Under Obama Than Reagan

  5. 6
    Ron Chusid says:

    @M: 2010 was during Obama’s term in office, which is the only relevant comparison. You don’t like the numbers so you think you can move the goal posts and change the issue.

    The question under consideration is whether the conservative claim that taxes under Obama are true. This is clearly false. 2010 was well during Obama’s term and rather than raise taxes as conservatives think, he lowered them compared to when he first took office.

    I realize that conservatives don’t want to get involved with looking at actual facts, but if we talk 2013 or 2014 we are no longer dealing with facts.

    Even if we speculate, the conservative argument remains false. If we extrapolate based upon Obama’s tax proposals, 99% of the country would be paying lower taxes than under Reagan. The remaining 1% will see the biggest change in their taxes, but even their taxes are likely to be lower than under Reagan. Even if it does turn out that a portion of 1% wind up paying higher taxes than under Reagan, this hardly supports the conservative claims.

  6. 7
    Gildred Price-Barber says:

    Tax Rates Lower Under Obama Than Reagan

  7. 8
    Joseph Blough, Jr. says:

    @ Ron Chusid:  Concerning 2013 or 2014, who knows the future; and even an educated guess is just a guess.  As for 2010, M is correct.  Even though Obama was the president in 2010, the income tax rates in effect were the result of the rate cuts made during the Bush administration.  The only tax rate Obama cut was the 2% reduction to the employee share of SS contribution.  There was no reduction to the employer share which remained at 6.3%.  

  8. 9
    Ron Chusid says:

    First of all it is not true that this was the only tax cut under Obama. There were other tax cuts under his stimulus plan. For example, although it was temporary I did get a tax break on newly hired employees. Secondly, even if this was correct it still would provide evidence that taxes went down under Obama, contrary to conservative claims of higher taxes under Obama. Whether other taxes went down under Bush or Obama is irrelevant to what is under discussion here–just another way for right wingers to justify ignoring reality.

  9. 10
    Maurice Ross says:

    Tax rates Lower under Obama than Reagan

  10. 11
    Maurice Ross says:

    Tax rates Lower under Obama than Reagan

  11. 12
    Hannah says:

    Tax Rates Lower Under Obama Than Reagan

  12. 13
    John Sonntag says:

    RT @ronchusid: Tax Rates Lower Under Obama Than Reagan #p2 #p21 #topprog

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