No, It’s Actually The Rich Who Deserve A Tax Break

America is run by the 1%; the economy is rigged; the deck has been stacked against you. These are the tired refrains of progressive champions who wish to incite class conflict for sake of achieving economic equity. The progressive paradigm is entirely predicated on the notion that the rich are taking more than they deserve and giving back less than they should. At the center of this is a tax code that has been designed by and for the rich at the expense of the rest of the country.

Europe’s middle classes are subject to way higher taxes than America’s middle class.

The truth of the matter is that high-earners in America pay well beyond their fair share. More specifically, America has the most progressive tax system in the developed world. This certainly doesn’t comport with the anecdotes and infographics your friends share on Facebook. After all, don’t the rich pay upwards of 60% of their earnings in Europe’s most glorious utopias?

America Has the Most Progressive Tax Code

It is indeed true that the rich are generally subject to steeper tax rates in most European countries (though not dramatically steeper if you account for the union of state and federal income taxes). But while Europe’s wealthiest citizens tend to have higher taxes than their American counterparts, Europe’s middle classes are subject to way higher taxes than America’s middle class.

In technical terms, the ratio of the rich’s contribution to the tax pool to their share of national income is higher in the US than in European countries, e.g. Sweden, Germany, the UK, France, and so on. The Washington Post produced a fun graphic to illustrate this fun point (the figure relies on OECD data from 2008, before the expiration of the Bush tax cuts).

Observe that the top 10 percent of earners in the US make 33.5% of national income, yet are responsible for 45% of tax revenues; on the other hand, Sweden’s top 10 percent make 26.6% of national income, but shoulder exactly 26.6% of the tax burden. America’s ratio of 45/33.5 is the highest in the developed world, and thus our tax code is the most progressive.