As you wrestle with your 1040s, 1099s, W2s, Schedule C’s and other income tax impedimenta, the Oregon Center for Public Policy offers a few facts that should comfort you – and probably will surprise you, especially if you get your information from Glenn Beck and Lars Larson.
Surprise No. 1: President Obama and the Democratic Congress have not raised taxes for the overwhelming majority of Americans. In fact, 98% of American taxpayers – and 98% of Oregonians – got an income tax cut in 2009.
OCPP cites a report just released by Citizens for Tax Justice that found 98% of working Oregon taxpayers (“working” defined as those who report earned income) benefited from at least one of the four tax cuts included in the American Recovery and Reinvestment Act signed into law by Obama last year.
On average, Oregonians received $1,087 from these cuts. For the bottom 20% of earners the average was $461, for the next 20% it was $693, for the third 20% it was $650, and for the fourth 20% it was $753. The next 15% of Oregon taxpayers got an average tax cut of $2,090, the next 4% got $4,556, and the top 1% got a cut of $2,820.
A large portion of the break enjoyed by Oregon taxpayers came from the Making Work Pay Credit, which provided a refundable credit of up to $400 per individual or $800 per couple for taxpayers with incomes below $75,000 ($150,000 for married couples) with the aim of stimulating consumer spending. The average Oregon taxpayer got a $520 credit under that provision.
Surprise No. 2: State taxes and spending in Oregon now are no higher than they were 30 years ago, measured as a percentage of Oregonians’ total income.
“The public sector is no more expensive today than it was back in 1980,” OCPP Executive Director Chuck Sheketoff said in a news release. “It costs Oregonians roughly the same share of their total income” – that is, 15% – “as it did three decades ago.”
OCPP analyzed US Census data for every year from 1980 through 2007 (the latest available) and found that “with some fluctuations, in each of those years roughly 15 of every 100 dollars of Oregonians’ combined income went to state and local governments in the form of ‘own-source general revenue.’” “Own-source general revenue” includes state and local taxes, fees and charges, and money from other sources such as the state lottery.
But at the same time, working Oregonians who think their taxes have gone up aren’t wrong, the OCCP said. That’s because the tax burden has shifted, with Oregon families being made to shoulder a bigger share of the state tax load as corporations have paid less.
During the period the OCPP analyzed, the share of total revenue paid by corporations went down from 4.6% to 2.2%, while the share paid by Oregon households grew from 22.6% to 26.5%.
“For what it’s worth,” the OCPP’s report said, “Oregon ranks in the middle of the pack among states and the District of Columbia for both the revenue state and local governments generate and the money they spend as a share of personal income.”
This article appears in Apr 15-21, 2010.
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I’m not sure I follow. How is it that the amount of tax we pay is the same as in 1980 (~15%), but the tax burden has shifted from corporations to families, and we’re actually paying more?
Not trying to be contrary, just want to understand. Those seem like contradictory statements.
Troy: No contradiction. The amount of revenue that state and local governments collect as a percentage of Oregonians’ total income has stayed the same — 15% — for the past 30 years. But corporations are paying a smaller portion of total revenue now than they did 30 years ago, which means individuals and families are paying a bigger portion.
You don’t suppose there’ anything collusive going on. do you?
(I’m sorry, I have to lay out for your readers?) OK, I’ve filed my own taxes for over forty years, never made a mistake, never ‘missed’ a deduction. This year, with identical ‘deductions’ for both state and federal, the state tells me I own them three hundred and some dollars. OK, take it out the over forty years of tax returns I never asked for… but nooo…
The fed sends me a letter that says ‘you missed a deduction’, we’ve calculated it up and we owe you a additional three hundred and some dollars, which we are giving to the state.
So it can send it to Israel, to kill Palestinian babies.