Taxes are going up if Bush tax cuts are not made permanent

Total Tax Burden Is Rising to Highest Level in History

Everyone wants to know more about the budget and here is some key information with a chart from the Heritage Foundation and a video from the Cato Institute about the Laffer Curve. In a year and half (end of 2012) the Bush Tax Cuts will expire. However, is that wise? Not if you understand the Laffer Curve.

Taxes are projected to increase rapidly under various policy scenarios. If the 2001 and 2003 tax cuts expire and more middle-class Americans are required to pay the alternative minimum tax (AMT), taxes will reach unprecedented levels. The tax burden will climb even if those tax breaks are extended. President Obama’s budget, which cuts some taxes and raises others, also increases the overall tax burden.

PERCENTAGE OF GDP

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Total Tax Burden Is Rising to Highest Level in History

Source: Heritage Foundation calculations based on Congressional Budget Office and White House Office of Management and Budget data.

Chart 19 of 42

In Depth

  • Policy Papers for Researchers

  • Technical Notes

    The charts in this book are based primarily on data available as of March 2011 from the Office of Management and Budget (OMB) and the Congressional Budget Office (CBO). The charts using OMB data display the historical growth of the federal government to 2010 while the charts using CBO data display both historical and projected growth from as early as 1940 to 2084. Projections based on OMB data are taken from the White House Fiscal Year 2012 budget. The charts provide data on an annual basis except… Read More

  • Authors

    Emily GoffResearch Assistant
    Thomas A. Roe Institute for Economic Policy StudiesKathryn NixPolicy Analyst
    Center for Health Policy StudiesJohn FlemingSenior Data Graphics Editor

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