Suitably Flip

People Everywhere Just Got To Be Free

Today, the Tax Foundation released its annual calculation of Tax Freedom Day, that marvelous day each year when we've finally earned enough money to meet our tax burden.  Unfortunately, TFD will slip this year to April 26th, a full 10 days later than it fell in 2003 and 2004 and 3 days later than last year.

As painful as it is to be indentured to the government for these extra days, the drastic dip-rise cycle observable over the last few years actually has a relatively intuitive explanation (one that paints an encouraging economic picture).

At the end of the Clinton era, with effective tax rates higher than they are now, and amid a bubbly economy enfrothed in murderously taxable capital gains, Tax Freedom Day was bound to push out further into the year.  Upon the arrival of the blessed Bush tax cuts, TFD rolled way back.  Now, after a few years of rising incomes buoyed by those tax cuts, more and more Americans are leaping into higher marginal brackets, increasing their effective tax rates (relative to the moment of the cuts) and again delaying their annual manumission.  In that light, the delay is somewhat more palatable, but it's still a craw-sticker.

So hang in there, America.  Only two more weeks until you get to go to work for yourself!

(Care to know how many days you'll work this year just to pay for Social Security?)

Comments

People Everywhere Just Got To Be Free

Today, the Tax Foundation released its annual calculation of Tax Freedom Day, that marvelous day each year when we've finally earned enough money to meet our tax burden.  Unfortunately, TFD will slip this year to April 26th, a full 10 days later than it fell in 2003 and 2004 and 3 days later than last year.

As painful as it is to be indentured to the government for these extra days, the drastic dip-rise cycle observable over the last few years actually has a relatively intuitive explanation (one that paints an encouraging economic picture).

At the end of the Clinton era, with effective tax rates higher than they are now, and amid a bubbly economy enfrothed in murderously taxable capital gains, Tax Freedom Day was bound to push out further into the year.  Upon the arrival of the blessed Bush tax cuts, TFD rolled way back.  Now, after a few years of rising incomes buoyed by those tax cuts, more and more Americans are leaping into higher marginal brackets, increasing their effective tax rates (relative to the moment of the cuts) and again delaying their annual manumission.  In that light, the delay is somewhat more palatable, but it's still a craw-sticker.

So hang in there, America.  Only two more weeks until you get to go to work for yourself!

(Care to know how many days you'll work this year just to pay for Social Security?)