Tax Freedom Day Arrives on April 17

April 9, 2012

Tax Freedom Day is a vivid, calendar-based illustration of government's cost, and it gives Americans an easy way to gauge the overall tax burden.  The model assumes that the American workforce begins working on January 1 and receives the same daily pay throughout the year.  When the nation has finally earned enough to pay all the taxes that will be due for that year, Tax Freedom Day has arrived, says William McBride, an economist at the Tax Foundation.

Tax Freedom Day for 2012 will arrive later than most of the last 100 fiscal years, but is still not the latest on record.

  • Tax Freedom Day for the 2012 tax year arrives on April 17, 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 to earn enough money to pay this year's combined 29.2 percent federal, state and local tax bill.
  • If the federal government raised taxes enough to close the budget deficit (an additional $1.014 trillion), Tax Freedom Day would come on May 14 instead of April 17.

These 107 days of tax burden can be broken down into their respective sources so that Americans can see the proportional contribution of each type of tax:

  • Thirty-two days for the federal individual income tax.
  • Eight days for state and local individual income taxes.
  • Twenty-three days for federal social insurance taxes.
  • Two days for federal sales and excise taxes.
  • Twelve days for state sales and excise taxes.
  • Twelve days for state and local property taxes.
  • Nine days for the federal corporate income tax.
  • One day for state and local corporate income taxes.
  • Seven days for other taxes at both the state and federal level.

Tax Freedom Day varies substantially by state.

  • Dates range from March 31 in Tennessee to May 5 in Connecticut.
  • New Jersey and New York are the only other states that have Tax Freedom Days in May, both on May 1.
  • Louisiana, Mississippi, South Carolina and South Dakota all follow Tennessee closely, having days from April 1 to April 4.

Source: William McBride, "Tax Freedom Day Arrives on April 17th, 2012," Tax Foundation, April 2012.

For text:

http://taxfoundation.org/taxfreedomday

 

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