The Congressional Budget Office (CBO) reports that the rich are getting richer, at least based on how the tax code works. The report likely will set off another round of debates about whether the top 1% or 4% or 0.1% of the population in terms of income should pay higher taxes.
The CBO study indicates that the well off actually have large tax system advantages:
The 10 major tax expenditures considered here are distributed unevenly across the income scale. In calendar year 2013, more than half of the combined benefits of those tax expenditures will accrue to households with income in the highest quintile (or one-fifth) of the population (with 17 percent going to households in the top 1 percent of the population), CBO estimates. In contrast, 13 percent of those tax expenditures will accrue to households in the middle quintile, and only 8 percent will accrue to households in the lowest quintile.
Based on the net effect of this advantage for the rich, a higher tax burden may be barely higher at all.
Filed under: 24/7 Wall St. Wire, Research, Tax