One of the most dreaded days of the year is approaching … tax day. This year Tuesday, April 17 will be the last day people can file their taxes. It is also the Tax Foundation’s Tax Freedom Day, which calculates that Americans had to work more than a quarter of the year just to pay all the nation’s taxes for the year.
According to the Tax Foundation, Tax Freedom Day arrives “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 Tax Foundation says that it “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.”
In an article for Budget & Tax News, Joseph Henchman of the Tax Foundation explains, “We assume the nation starts working on January 1, earning the same amount each day and spending nothing. When the nation has finally earned enough to pay all the taxes that will be due for that year, Tax Freedom Day has arrived. This year, Americans will pay $2.62 trillion in federal taxes and $1.42 trillion in state-local taxes, for a total tax bill of 29.2 percent.”
If Americans were forced to pay the taxes necessary to pay off the $1.014 trillion budget deficit, Tax Freedom Day wouldn’t be until May 14. That means Americans would have to work 27 days just to cover the amount of borrowing due to over-spending our federal government has done for 2012.
The way to help workers work more days for themselves rather than for government is to implement solutions that help government run more efficiently and eliminate unnecessary government spending.