post by Paul Kelleher
Kevin Drum writes:
As you can see, the top 10% receive 41% of total income and pay 55% of total taxes. In other words, the federal tax system as a whole is progressive, but it's not very progressive.
I think this is not a good way of determining whether a tax system is progressive. Consider the following hypothetical claims that are nevertheless consistent:
1. The top 10% receives 50% of total income but pays 100% of total taxes. (On Drum's definition, this system is very progressive.)
2. But the only tax that exists requires everyone in the top 10% to pay one penny only, while everyone else pays nothing.
I think this shows that a group's share of total national taxes is not a meaningful number on its own, and shouldn't be used to determine the degree to which a tax system is progressive.