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1 Patrick Fleenor & Andrew Chamberlain, America's Shrinking Income Tax Base Requires Higher Rates for Everyone 1 (2005)

handle is hein.taxfoundation/ffdaxz0001 and id is 1 raw text is: FOUNATO
September 21, 2005
America's Shrinking Income Tax Base Requires Higher Rates for Everyone
by Patrick Fleenor and Andrew Chamberlain
An ideal tax system is one that taxes a wide base at a low rate. Unfortunately, the current federal
individual income tax system does neither. Thanks to a myriad of exclusions and preferences, the
current system taxes just 40 percent of actual income in the U.S. As a result, income tax rates are
more than twice as high as they could otherwise be.
Figures 1 and 2 below illustrate how various tax provisions have eroded the federal income tax
base, requiring higher overall tax rates for all Americans.
Figure 1. Credits, Deductions and Other Tax Provisions Erode the Tax Base

Source. Tax Foundation

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