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Today is Tax Freedom Day

In Special Report 198, the Tax Foundation announces that "Tax Freedom Day® 2012 arrives on April 17 this year, four days later than last year due to higher federal income and corporate tax collections. That means Americans will work 107 days into the year, from January 1 to April 17, to earn enough money to pay this year’s combined 29.2% federal, state, and local tax bill."

The report, prepared by William McBride, goes on to say:

"Tax Freedom Day is a vivid, calendar-based illustration of government’s cost, and it gives Americans an easy way to gauge the overall tax take. Conceived by Florida businessman Dallas Hostetler in 1948, he deeded the concept to the Tax Foundation upon his retirement in 1971. In 1990 sufficient data became available to calculate a separate Tax Freedom Day for each state."

Want a scary thought? A really scary one? McBride writes, "If the federal government raised taxes enough to close the budget deficit—an additional $1.014 trillion—Tax Freedom Day would come on May 14 instead of April 17. That’s an additional 27 days of government spending paid for by borrowing. This year’s federal budget deficit remains high, though it has declined slightly over the past two years."

Kudos to the Tax Foundation for this exceptionally helpful report that is helpful in understanding the extent of America's tax burden. Take a few minutes to browse the entire report, including its historical graph of tax freedom days, and the PowerPoint presentation.

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