-Caveat Lector- Revised January 15, 2003 http://www.cbpp.org/1-9-03tax.htm Administration�s Use of �Average� Tax Cut Figures Creates Misleading Impression About the Tax Cuts Most Households Would Receive By Isaac Shapiro and Joel Friedman
PDF of this analysis View Economic Stimulus Analyses If you cannot access the files through the links, right-click on the underlined text, click "Save Link As," download to your directory, and open the document in Adobe Acrobat Reader. Administration has sought to portray its �growth package� as providing substantial benefits to a broad spectrum of the population. To do so, it has repeatedly asserted that �92 million taxpayers would receive, on average, a tax cut of $1,083 in 2003.�[1] This information is misleading. Most taxpayers would receive far less than this average amount. According to data from the Urban Institute-Brookings Institution Tax Policy Center, 80 percent of tax filers would receive a tax cut of less than $1,083 in 2003.[2] How can this be? The average tax cut is much larger than the tax cut a typical household would receive largely because, in generating these figures, the Administration has averaged the big tax cuts that those at the top of the income spectrum would receive with the far more modest tax cuts those in the middle of the income spectrum would get (and the small or non-existent tax cuts that would go to working families with low incomes). Take, for example, a hypothetical situation where one taxpayer gets a $10,500 tax cut and 9 taxpayers receive a $500 tax cut. Among these 10 taxpayers, the average tax cut amounts to $1,500. Yet 9 of the 10 taxpayers are receiving a tax cut only one-third that size.[3] The Urban-Brookings Tax Policy Center data indicate the following about the tax cuts the Administration�s plan would provide in 2003: The average tax cut for tax filers in the middle fifth of the population � those filers right in the middle of the income spectrum � would be $256, only one-fourth the $1,083 figure the Administration is citing for the average taxpayer. Almost half of all tax filers � 49 percent � would receive tax cuts of less than $100. The average tax cut for the bottom 80 percent of tax filers would be $226. Even the next-to- top fifth of tax filers would get an average tax cut of only $574. By contrast, the top one percent of tax filers would receive an average tax cut of $24,100. Those with incomes of more than $1 million would get tax cuts averaging a whopping $90,200. Overall, 80 percent of tax filers would get less than the average tax cut of $1,083 the Administration is touting. The Administration also is promoting other highly stylized �facts� about how much in tax cuts would go to specific groups. These figures are similarly distorted. For example, the White House claims �13 million elderly taxpayers would receive an average tax cut of $1,384.� The Tax Policy Center data indicate that only 3.1 million elderly tax filers actually would get tax cuts of this size or greater. Some 79 percent of elderly tax filers � nearly four of every five � would get less than the amount the White House is advertising. Similarly, the Administration says the average tax cut among six million single women with children would be $541. Yet 85 percent of such women would receive tax cuts of less than $500, and 49 percent would receive nothing. The average is $541 because a small number of such women would receive massive tax cuts, thereby raising the average. End Notes: [1] �Taking Action to Strengthen America�s Economy,� White House website. [2] www.taxpolicycenter.org, Table 6 on the Administration�s stimulus proposal. Other data used in this analysis come from the Tax Policy Center�s Tables 1 and 2 on the Administration�s stimulus proposal. [3] 9 times $500 is $4,500. $4,500 plus $10,500 is $15,000. $15,000 divided by 10 is $1,500. Home | Background Information | Board of Directors | Center Staff Search | Publication Library | Job Opportunities | Internship Information State Policy Work Home Page Click here to join the Center's e-mail notification list. To ask questions, or send comments, write to [EMAIL PROTECTED] Center on Budget and Policy Priorities 820 First Street, NE, Suite 510 Washington, DC 20002 Ph: (202) 408-1080 Fax: (202) 408-1056 Forwarded for your information. The text and intent of the article have to stand on their own merits. ~~~~~~~~~~~~~~~~~~~~ In accordance with Title 17 U.S.C. section 107, this material is distributed without charge or profit to those who have expressed a prior interest in receiving this type of information for non-profit research and educational purposes only. ~~~~~~~~~~~~~~~~~~~~ "Do not believe in anything simply because you have heard it. Do not believe simply because it has been handed down for many genera- tions. Do not believe in anything simply because it is spoken and rumoured by many. Do not believe in anything simply because it is written in Holy Scriptures. Do not believe in anything merely on the authority of teachers, elders or wise men. Believe only after careful observation and analysis, when you find that it agrees with reason and is conducive to the good and benefit of one and all. Then accept it and live up to it." The Buddha on Belief, from the Kalama Sut <A HREF="http://www.ctrl.org/";>www.ctrl.org</A> DECLARATION & DISCLAIMER ========== CTRL is a discussion & informational exchange list. Proselytizing propagandic screeds are unwelcomed. Substance�not soap-boxing�please! These are sordid matters and 'conspiracy theory'�with its many half-truths, mis- directions and outright frauds�is used politically by different groups with major and minor effects spread throughout the spectrum of time and thought. That being said, CTRLgives no endorsement to the validity of posts, and always suggests to readers; be wary of what you read. CTRL gives no credence to Holocaust denial and nazi's need not apply. Let us please be civil and as always, Caveat Lector. ======================================================================== Archives Available at: http://peach.ease.lsoft.com/archives/ctrl.html <A HREF="http://peach.ease.lsoft.com/archives/ctrl.html";>Archives of [EMAIL PROTECTED]</A> http:[EMAIL PROTECTED]/ <A HREF="http:[EMAIL PROTECTED]/";>ctrl</A> ======================================================================== To subscribe to Conspiracy Theory Research List[CTRL] send email: SUBSCRIBE CTRL [to:] [EMAIL PROTECTED] To UNsubscribe to Conspiracy Theory Research List[CTRL] send email: SIGNOFF CTRL [to:] [EMAIL PROTECTED] Om
