AP Fails to Note High Tax Future
The Associated Press’ Stephen Ohlemacher had a fine item out February 7th noting that federal tax receipts as a percentage of GDP are at their lowest level since World War II. Ohlemacher even properly reported that “the poor economy is largely to blame.” But no where does Ohlemacher clearly explain the difference between tax rates and tax receipts. It is not until the 14th paragraph that he finally reports that “Income tax rates remain unchanged.”
So will federal taxes remain low when the economy improves? Ohlemacher does not tell us. But the Congressional Budget Office does. Thanks to our already very progressive tax code, as the economy recovers tax receipts are set to sky rocket and will reach post-WWII highs by the mid 2020s.