Check this out: The percentage of taxpayers with no income tax liability is at an all-time high. It's worth noting that just a quick glance at the stats shows that this has gone up from about 1/4 of the population in 2000, before Bush took office, to almost a third, an increase of 7.2 percentage points or almost 29% growth. I want to look into the numbers a bit more. Somewhere in there it should indicate who makes up that additional 29%. My guess is it's a bit of the very bottom, i.e. the lowest income workers, and a hefty helping of the top. But I'll try and see...
Some interesting things that jump out initially though...
- From 1950 to 1970, this figure steadily declined, at least apparently: The data points there are at five-year intervals, so conceivably there was variation within those intervals, including the possibility of an increase in the rate. But overall the trend was down.
- There is a significant uptick from 1970 to 1975, with basically restoration again in 1980. This tracks pretty well with the Republican administration in office at the beginning of the '70s and Democratic administration in office at the end (there was a Democratic Congress throughout).
- There was a pretty significant increase from 1990 to 1995, about 17%, which is interesting considering the various tax reforms enacted during that period, including George H.W. Bush's 1990 tax increase and the Revenue Reconciliation Act of 1993.
- There was a noticable, but not significant, increase in the late '90s. How this jibes with the increasing income of earners during the late '90s job and investment boom is a quite interesting question.
- Since 2000, there's been a steady increase, not surprising considering the Bush Administration's emphasis on tax cutting.
As I said at the start, what's interesting about these figures is determining where the newly tax-shorn come from. Of course, there are other significant sources of income out there besides plain ol' income, which wouldn't necessarily be covered by these figures. But for most people below the top economic strata, other means of earning income, including capital gains on stocks and stock options, still come out on your final income tax statement, so it's still salient.