1. We don’t have a progressive tax system. A truly progressive tax system would ask those who are the most well-off in America to contribute the largest share of their income in taxes. Our federal taxes are progressive, but when you account for state, local and sales taxes, top-line taxation rate isn’t really progressive at all. The share of total taxes paid is roughly in line with shares of total income across all earning levels. (Chart via Citizens for Tax Justice)
2. We’re one of the least-taxed countries in the world. Though the animating impulse of much of conservative politics is that we’re over-taxed, total government receipts are less in the United States than they are in any other member of the Organisation for Economic Co-operation and Development, as a percent of GDP. (Chart via Center on Budget and Policy Priorities)
3. Not many companies pay the corporate tax rate—and some don’t pay any corporate taxes at all. Politicians and corporate lobbyists are fond of saying the US corporate tax rate of 35 percent is the highest in the world, which is technically true—but thanks to expansive tax loopholes, many corporations don’t pay nearly that much. Citizens for Tax Justice looked at consistently profitable Fortune 500 companies and found they paid 19.4 percent of their profits in taxes over the past five years. (Note that a single taxpayer earning $37,000 annually pays a 25 percent rate.) Many big companies don’t pay any taxes at all. (Chart via Citizens for Tax Justice)
4. Some of your tax dollars are given to hugely profitable companies. You’ll note in the chart above that these companies have a negative tax rate—meaning they actually get money from the government. This can come in the form of federal tax breaks and other preferential treatment of certain financial instruments. Then consider the subsidies given directly to industry, along with the safety net programs some of these companies force employees to rely on, and the number gets quite big.
Take Walmart, the largest private employer in the country. They take in $16 billion in profits annually. Yet, all told, Walmart cost taxpayers $7.8 billion last year, according to Americans for Tax Fairness: