I just read an article over at CNN that this year’s Tax Freedom Day in the U.S. is April 23rd. Tax Freedom Day is a purely theoretical date that helps you to visualise how much the government steals from the income of an average American. It depends a lot on the state you’re living in though, in Alaska it’s March 29th but in Connecticut it’s May 8th.
The result shows that Americans pay about 30.8% of their income toward taxes. And the 113 days from January 1 to April 23 represent about 30.8% of the year.
Thanks to this year’s upcoming stimulus rebates and slowed economic growth, the national tax burden will be paid off three days earlier than last year, said the Tax Foundation, a taxpayer advocacy group.
“Tax freedom day” is purely theoretical – it assumes Americans have been working seven days a week since January 1 and don’t spend any of the money they make.
The article also includes a pretty interesting chart that shows how much taxes have increased in the U.S. since 1900. More than a century ago taxes were only 5.9% but now they’re more than five times as high. I wonder how the chart would look like in my country but I can’t really find something similar.
Last year Tax Freedom Day fell on June 10 in Belgium according to PricewaterhouseCoopers but IMO taxes are a lot higher if you take a look at the complete picture. Income taxes are sky high, employees only receive a fraction of what they cost to an employer, there’s 21% VAT on most products, high taxes on automobiles and gas, high corporate taxes, taxes on real estate, high inheritance taxes, tax on interest and dividends and lots of other various taxes to squeeze you out like a lemon. One of the only things Belgium doesn’t have (yet?) is a tax on capital gains.
I truly hope this will change in the future and that we’re going to get a much smaller and more efficient government that no longer throws money out of the window but it’s not really likely as none of the major political parties is willing to cut in its own flesh. If nothing changes things will likely get very ugly when the babyboom generation starts to retire.
Some more Tax Freedom Dates for countries around the world can be found on this Wiki page.