Tax Freedom Day will arrive on April 18th this year, the 108th day of 2013, the Tax Foundation reported this week in a release.
Americans will work well over three and a half months of the year before they have earned enough money to pay this year’s tax obligations at the federal, state and local levels. Both higher federal taxes and rebounding incomes contribute to this year’s date, which is five days later than in 2012, the foundation said.
In an agency study, “Tax Freedom Day 2013,” economists William McBride, Elizabeth Malm and Kyle Pomerleau also calculated how long Americans would have to work in order to close the federal budget deficit. In order to pay for all spending in the current year, the government would need to raise an additional $833 billion in taxes, pushing Tax Freedom Day to May 9th.
“This year, Americans will work five days later than in 2012 to pay all of their taxes. The total tax bill at all levels comes to approximately $4.2 trillion, or 29.4 percent of their total income,” McBride said. “That means Americans will pay more in taxes in 2013 than they will spend on food, clothing, and housing combined.”
Historically, the date for Tax Freedom Day has fluctuated significantly. The latest-ever nationwide Tax Freedom Day was May 1, 2000 – meaning that Americans paid one-third of their total income in taxes. A century earlier, in 1900, Americans paid only 5.9 percent of their income in taxes, meaning Tax Freedom Day came on January 22.
For more information, visit www.taxfreedomday.org.