Post by ReformedLiberal on May 13, 2012 6:12:27 GMT -8
This year Americans will pay more in total taxes than they spend for food, clothing, and shelter combined, illustrating what the Tax Foundation calls the “growing cost of government.”
Total outlays for taxes in 2012 will be about $4.04 trillion, which is $152 billion more than Americans will spend on housing, food, and clothing.
“Relative to the basic cost of living, taxes have increased considerably in recent decades,” the foundation states in a new report.
In 1929, Americans paid $10.1 billion in taxes while outlays for food, clothing, and shelter totaled $41.6 billion.
The cost of those essentials surpassed tax collections every year after that until 1981, when the $858.3 billion paid in taxes narrowly surpassed the $854.4 spent on food, clothing, and shelter.
Seven years later, in 1988, taxes again surpassed outlays on essentials, and they remained larger than food, clothing, and shelter costs every year until 2009, when the economic slowdown reduced tax collections.
But after a two-year gap, taxes are once again trumping spending for food, clothing, and housing.
The Tax Foundation also points out that transfer payments — government outlays that Americans can use to purchase food, clothing, and housing, among other things — have increased considerably in recent decades.
In 1929, transfer payments accounted for just 0.5 percent of private outlays on food, clothing, and shelter. By 1965, when Medicare began, the percentage had grown to about 11 percent. Today it is close to 35 percent.
“Consumption data, which comes from the Bureau of Economic Analysis, includes private consumption that is paid for with government transfer payments from assistance programs such as Medicare,” Kevin Duncan of the Tax Foundation observes.
“This leads to double counting, as the taxes that finance these programs and the increased consumption that those taxes fund are included in both tax and consumption figures, respectively.
“Despite these limitations, the comparison of tax costs to the basic cost of living provides a useful illustration of the growing cost of government.”
Total outlays for taxes in 2012 will be about $4.04 trillion, which is $152 billion more than Americans will spend on housing, food, and clothing.
“Relative to the basic cost of living, taxes have increased considerably in recent decades,” the foundation states in a new report.
In 1929, Americans paid $10.1 billion in taxes while outlays for food, clothing, and shelter totaled $41.6 billion.
The cost of those essentials surpassed tax collections every year after that until 1981, when the $858.3 billion paid in taxes narrowly surpassed the $854.4 spent on food, clothing, and shelter.
Seven years later, in 1988, taxes again surpassed outlays on essentials, and they remained larger than food, clothing, and shelter costs every year until 2009, when the economic slowdown reduced tax collections.
But after a two-year gap, taxes are once again trumping spending for food, clothing, and housing.
The Tax Foundation also points out that transfer payments — government outlays that Americans can use to purchase food, clothing, and housing, among other things — have increased considerably in recent decades.
In 1929, transfer payments accounted for just 0.5 percent of private outlays on food, clothing, and shelter. By 1965, when Medicare began, the percentage had grown to about 11 percent. Today it is close to 35 percent.
“Consumption data, which comes from the Bureau of Economic Analysis, includes private consumption that is paid for with government transfer payments from assistance programs such as Medicare,” Kevin Duncan of the Tax Foundation observes.
“This leads to double counting, as the taxes that finance these programs and the increased consumption that those taxes fund are included in both tax and consumption figures, respectively.
“Despite these limitations, the comparison of tax costs to the basic cost of living provides a useful illustration of the growing cost of government.”