Your Biggest Expense...
Today, taxes are by far the biggest expense for American families.
According to a new study by the Tax Foundation, taxes take more of the
median two-income family's earnings than food, clothing, housing and
transportation -- *combined.*
The median two-income American family in 1998 paid taxes of $26,759 on a
total income of $68,759. Federal taxes took 25.9% of that paycheck, and
state and local taxes took an extra 13.1%. (Other studies indicate this tax
bite is even higher. And this figure doesn't include the huge additional
cost of complying with government regulations, a cost that is, in effect,
an additional tax burden.)
Compare that with forty years ago. In 1958, federal taxes took 14.2%, and
state and local taxes 3.7%
It's also interesting to compare the savings rate for those two eras. In
the lower-tax year of 1958, the annual savings rate was 6.5%. In 1998, it
had fallen to 0.4%
(Source: Tax Foundation study, reported by Associated Press analyst John
Cuniff)
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