How Much is Enough?All things considered, it’s hard to say whether taxes are too high or too low at any point in time. But one thing’s for sure – it hasn’t always been this way.
For most of America’s history, we’ve been a low-tax haven. From the nation’s founding through the early part of last century, government spending at all levels rarely exceeded 10% of the nation’s income, and even then only during wartime.
In 1927, Supreme Court Justice Oliver Wendell Holmes made his famous observation that “taxes are what we pay for civilized society.”
Easy for him to say. At that time, the average American tax burden was around 10.6% of income, and Tax Freedom Day arrived in early February.
Today, it hovers around 32%. And that doesn’t include the high and very real costs of tax compliance.
These “paperwork burdens” add another $265 billion – or 22 cents for every federal tax dollar – to the nation’s total tax bill.
Of course, taxes ultimately pay for government services. And many of these are essential to keeping society running smoothly – police, roads, courts. Everyone pitches in for them.
But where is the limit? In addition to these basic services, everyone has a list of publicly funded projects he or she thinks necessary. At what point are we no longer getting a good deal for tax dollars?
One way to answer that is to compare taxes with our other expenses.
This year, we’ll work 116 days to pay taxes. In contrast, we’ll work just 106 days on average for food, clothing and housing, combined.
That wasn’t always the case. Only in the last decade have taxes exceeded spending on those basic necessities.
Today we work 52 days for our own health and medical care, but twice as many for the health of local, state and federal governments.
http://www.taxfoundation.org/research/show/1436.html
