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Describing Obamacare as a "Tax"

When asked years ago whether Obamacare could possibly be construed as a tax, Obama angrily said "no." Obamacare's individual mandate was NOT in the revenue portion of the bill. Roberts wrote most of the persuasive dissent in the Supreme Court ruling, so he knew very well that Obamacare was not really a tax, and he merely voted with the majority to try to sidestep controversy (as any number of subsequent reports indicated). The morning after the Court's ruling, the White House reiterated the obvious truth that Obamacare was not a tax. So the article ought to delve into these nuances, but instead it coldly declares Obamacare a tax. Which, of course, it isn't. — Preceding unsigned comment added by 216.49.20.187 (talk) 17:52, 27 October 2013 (UTC)

I updated this portion of the article to reflect the decision in National Federation of Independent Business v. Sebelius, where SCOTUS upheld the Act as valid under Congress's taxation power in the Constitution. The IRS itself is still disputing whether it is in fact a tax; the important thing for this article is that it is an example of an act being held as valid under the tax power. As an encyclopedia, the angry rhetoric in the preceding comment should not be reflected in the article itself. The appropriate place for a nuanced look at the PPACA is in its own article and the SCOTUS case article, not in the overview article for U.S. Taxation. Laertes513 (talk) 02:39, 25 February 2014 (UTC)

Greetings! New posts should go at the bottom of the page. That said, internal motivations aside, the Supreme Court has held that Obamacare is a tax. It is certainly fair to add analysis by tax experts who say otherwise, but we only report what the sources say. bd2412 T 02:56, 25 February 2014 (UTC)

Chart that needs to be removed

If you look at the creation history of this chart (by clicking on it) you can see that it was created by VictorD7 and is sourced to an unreliable right-wing organization known as the Peter G. Peterson Foundation. If the material is reliable and worth mentioning, it needs to be directly sourced to a weighted organization, which includes scholarship coming out of academia. VictorD7 has been insistent on pushing his right-wing agenda, which is harmful to creating a neutral presentation of data.

The reason for not being able to find a reliable source presenting this chart is because there isn't one that exists. The Tax Policy Center created no chart; the Peter G. Peterson Foundation did. By leaving out the dollar figures from Footnote #1 there is no context in relation to the tax rates, which creates a highly biased presentation. -- Somedifferentstuff (talk) 11:08, 5 November 2013 (UTC)

The PGPF is a perfectly fine source (they just drew the chart anyway) and the chart's numbers come from the Tax Policy Center (feel free to compare the figures), a perfectly fine liberal source widely cited by media and scholars. I'm not sure why me being the one who gained permission for the chart's use is relevant. The CTJ/ITEP chart it replaced was drawn by a Misplaced Pages user (reliable source?), and its data was produced by a leftist think tank with a liberal lobbying arm. Even if one accepted your off the mark premises, the more appropriate, up to date chart should be the least of your concerns. Also, why does it need dollar figures? How is it "biased" for an effective rate chart to not have dollar figures? That would be extra information, and they change significantly over time anyway. Your comment is irrational. It's more important that it contains informative component breakdowns, which the previous (disputed, truly biased) chart didn't. Finally, your hypocritical, off the mark personal attack against me isn't conducive to a productive discussion. VictorD7 (talk) 11:24, 5 November 2013 (UTC)

I'm not sure it makes sense to discuss this in both places... so I'm just going to point to the other discussion thread as most of the points are the same. Talk:Progressivity_in_United_States_income_tax#Chart_that_needs_to_be_removed Morphh 14:07, 5 November 2013 (UTC)

I moved the graph that EllenCT added to the section "Levels and types of taxation" and restored the federal graph. They show different things. As for corporate tax incidence, that can be measured (modeled) in many ways (some split the burden with shareholders and some pass it all to the consumer) - there is no defined "correct" way to measure that, just better models that reflect reality. The TPC is a more neutral source than the CTJ/ITEP. Since the TPC graph breaks down the components and covers federal taxes, it should be included. I'm not sure how useful the CTJ graph is with bundling all the burdens of the 50 states, which have a wide range of tax rates and progressivity, into a single graph. So I question its inclusion but in any case, it's not a replacement for the other graph. Morphh 14:49, 18 December 2013 (UTC)

I would agree that the chart does a decent job of taking complex and boring tax data and showing it graphically. The Tax Policy Center as a source is certainly a standard verifiable source for the data itself. The chart should stay in the article. N2e (talk) 00:31, 21 December 2013 (UTC)

• Remove for the reasons at . The chart is propaganda intended to try to continue to lower taxes on the rich, which are more accurately illustrated by the ITEP chart. EllenCT (talk) 01:03, 22 December 2013 (UTC)

There is little basis for that assertion. The TPC is well respected and considered neutral. If anything, they fall center-left. Your objects thus far have been inaccurate and the graph you're trying to insert is bias on multiple accounts. Morphh 05:46, 22 December 2013 (UTC)

Do you know of any peer reviewed source which agrees with those unreviewed TPC numbers? All of the peer reviewed WP:SECONDARY sources agree with the ITEP graph. Here is an example WP:SECONDARY peer reviewed source which agrees with the ITEP corporate tax incidence. Note that not all documents on the ITEP or CTJ web sites are peer reviewed. EllenCT (talk) 12:51, 22 December 2013 (UTC)

I see no mention of the ITEP figures in that publication or that the TPC are incorrect. Also, that's not a secondary source. You're trying to source a model of tax incidence on corporate taxes. It's not even clear ITEP uses that model based on their FAQ and I haven't seen their original publication. You're failing verifiability. You can't take a graph that combines over 100 tax systems, pull out one tax in that graph, suggest that one tax uses an incidence model that is peer reviewed and thus superior as justification for the entire graph. That paper does not make that data peer reviewed. As for the TPC data, they use the Urban-Brookings microsimulation model which is peer reviewed. The model is similar to those used by the Congressional Budget Office (CBO), the Joint Committee on Taxation (JCT), and the Treasury's Office of Tax Analysis (OTA). In addition to those, the PolitiFact secondary source I linked to below uses the TPC data in their fact check, suggesting that it is a trusted source over more partisan publications. Morphh 13:57, 22 December 2013 (UTC)

The source is secondary because it's a meta-analysis of authenticated data sets. Just because you are unable to recognize publication categories or unable to do the verification math doesn't mean I'm failing verification. Do you think Geithner's tables include sales tax? It's the most regressive. EllenCT (talk) 16:34, 22 December 2013 (UTC)

That publication makes no mention of the ITEP or the CTJ, so how is it a secondary source for the graph? It's about the corporate income tax, so how is it a secondary source for the other 100+ taxes in that graph? You're not making any sense. Geithner's tables didn't include state level taxes and neither does the TPC graph - it's the same data. Morphh 16:59, 22 December 2013 (UTC)

I am confused about two things shown on this chart:

1. First, it has separate lines for "Top 1 Percent" and "Top 0.1 Percent" - is the first of these lines actually representative of those between 1% and .01%, or does it include everyone over the top 1%, including the top 0.1%? If the latter, then it seems that people in the last group are being counted twice, which does not occur anywhere else on the chart. Is there a difference if they are separated out?
2. Second, I notice that "estate tax" is included in the last few lines, but it is my understanding that people do not pay an estate tax in years in which they don't die, and that the estate tax is not connected to "cash income" for the year. For example, a person could have made a billion dollars over a fifty year period, end then retired and made no cash income for several years; their estate tax on death would be against their billion dollar estate, even if their actual cash income for that year placed them in the lowest quintile. Does this chart reflect this?

Cheers! bd2412 T 02:31, 22 December 2013 (UTC)

Are you referring to the chart in the previous section, or the ITEP chart? EllenCT (talk) 12:37, 22 December 2013 (UTC)

Sounds like the previous section. On the first question, I believe they are similar to the other percentiles, but it doesn't specifically state that. The TCP data for the graph is here but here is the breakout of percentiles which include 20, 40, 60, 80, 90, 95, 99, 99.9. So I think the label "Top 1%" was just a cosmetic choice as oppose to saying the "99-99.9 percentile" in the chart/graph. As for the second question, other publications from the TPC state that they measure estate tax if the person dies that year. Morphh 14:52, 22 December 2013 (UTC)

Yes, I meant the previous section. I am still leery of presenting estate taxes in a way that gives the impression that they are connected to cash income for the year in which the tax is paid, and I would be quite surprised if income-earning taxpayers in the fourth quintile and the lower portion of the and lower fifth quintile were not paying at least some estate taxes, since most small business owners reside there. bd2412 T 18:30, 22 December 2013 (UTC)

The estate tax measure for the lower percentiles is less than .05 according to the data, so the TPC doesn't include it in their chart. I understand your concern, but at least in this graph, each tax is clearly indicated and the methodology for the tax is known. Here is their methodology for the estate tax. It is described in full here: Burman, Lim, and Rohaly (2008). "Back from the Grave: Revenue and Distributional Effects of Reforming the Federal Estate Tax." Morphh 19:03, 22 December 2013 (UTC)

Thanks, I see where the disconnect is occurring. According to the paper, the economic income against which the estate tax is measured is "a broad measure of income that includes economic returns to capital regardless of whether they are realized or not", which is something a bit different from "cash income". Assessment of the estate tax forces all property to be assessed under the stepped-up basis, thereby generating cash income for the decedent on paper wherever property values have increased since the purchase of the property. Under that measure, even someone whose actual cash income in any given year never exceeded, say, an inflation-adjusted hundred thousand dollars, could jet up to the top five percent based on the combined value of all of their property. Of course, their estate would only be susceptible to the estate tax in the first place if it was worth over $5.25 million, and this status would only be achieved following their death. bd2412 T 20:47, 22 December 2013 (UTC)

Summary - It looks like EllenCT is objecting to the corporate tax in this graph, suggesting it is not peer reviewed or that the ITEP graph model is better. The TPC uses the same method as the Congressional Budget Office (CBO) and the Treasury's Office of Tax Analysis (OTA). Their model is peer reviewed in many publications. Their figures are considered neutral and used to fact check other tax assertions. Here is what the TPC actually does with Corporate income taxes:

we estimate that 60 percent is borne by shareholders, 20 percent by all capital owners, and 20 percent by labor. Based on our review of research on the issue, we do not assign any of the burden to consumers. Previously, we assumed that the entire burden fell on all owners of capital. Our current assumptions are similar to those now made by CBO and Treasury.

In addition, it looks like the ITEP, based on their FAQ, places all of the burden on capital holders (the reverse of what it seems EllenCT is arguing):

It is generally agreed that corporate income taxes, at both the state and federal level, fall primarily on owners of capital. In accordance with this theory, ITEP’s incidence analyses of state corporate income taxes typically distribute the incidence of the tax according to nationwide ownership of capital assets such as stocks and bonds.

So it's not even clear that the publication that EllenCT is using as a secondary source for the ITEP, which suggest a high burden attributed to labor, is the methodology the ITEP uses. See the section below for additional reasons why the ITEP graph is not suitable for inclusion. In conclusion, this graph is supported by TPC data, which is considered a non-partisan source. They use standard models that have been peer reviewed and are generally accepted. Morphh 17:59, 22 December 2013 (UTC)

Furthermore, Ellen has been confusing "consumers" with "labor" as demonstrated by this discussion: . I was ready and willing from the beginning to refute her claims about the state of "peer reviewed literature", in part by quoting from her own sources, but her failure to support her premise regarding ITEP's corporate attribution methodology, especially in the face of proof debunking it, made the tangent irrelevant to that particular discussion. Fortunately you've gone a long way toward doing that here, lest other posters come along and get partially misled by her claims. VictorD7 (talk) 00:11, 23 December 2013 (UTC)

You have obviously not found a single peer-reviewed publication which agrees with you, although you have apparently made Morphh believe that the TPC website is peer reviewed. Are your urges to boast stronger than your desire to show taxes as progressive for the top 1% when you know corporations pass about half to their customers? EllenCT (talk) 07:11, 24 December 2013 (UTC)

Your own meta-analysis, along with some others I found, disagree with your alleged survey of "peer reviewed literature" (even ITEP does, as I quoted). You don't know the difference between "consumers" and "labor" (you misunderstood the study you linked to), you refuse to address facts like ITEP attributing all of its measurable state corporate incidence to the top 5% (especially the top 1%. Half to consumers? You mean high end jewelry shoppers?), you continue to dishonestly portray my personal comments on the matter despite me correcting you with linked quotes numerous times, and you continue to falsely project your own, explicitly stated POV "desire" onto me when I'm simply citing the most prominent sources (the TPC being left leaning at that). Ellen, you outright said in the below section that your motivation was to show that the top 1% pays less in taxes than the rest of the top 20%, even citing Warren Buffet. Misplaced Pages is not the venue for crusading. VictorD7 (talk) 08:46, 24 December 2013 (UTC)

The meta analysis says corporations pass about half to three fourths of their taxes to consumers, and you're pushing charts and sources that say zero when you know it's nowhere near zero. But by all means, keep digging. EllenCT (talk) 11:33, 24 December 2013 (UTC)

That meta analysis has no WP:WEIGHT. It was just released in March of this year - it's a published model that has no accepted use. Compared with the vast use and acceptance of models by the CBO, Treasury, and other tax policy research institutes - it's still WP:FRINGE research. That model is not even used by the ITEP graph you're trying to include as a replacement. Also for clarification, the meta analysis discusses a greater share attributed to labor, not consumers, and that attribution in the TPC data is not zero. To play on your last statement, there is no digging left for this argument - the hole has been dug. Morphh 14:33, 24 December 2013 (UTC)

That was the data set review on page 17 here which VictorD7 called a meta-analysis, which it is not. The paper you linked to is also a WP:SECONDARY source because it is the latest in a long line of actual meta-analyses, all of which are generally in agreement because none of which say corporations don't pass any taxes to consumers. Both are secondary sources, but only the Altshuler paper is peer reviewed. The Harris paper, like almost all of the rest of the TPC publications, was not peer reviewed, but its table on page 17 lists peer reviewed sources. The fact remains that, as VictorD7 has said, corporations do not pass 0% of their taxes on to their consumer customers, but closer to 50%, which means the ITEP graph is correct and the Peterson graph is intentionally misleading in this case. There is simply no counter-argument to these established facts which are applicable to the WP:V policy preferring peer reviewed sources from academic journals in the mathematical sciences and historical arts. EllenCT (talk) 02:24, 25 December 2013 (UTC)

I think we may need outside review. I'm not sure how to continue this discussion. What is in the charts, the models, and the Misplaced Pages policies is not as you state. Morphh 16:40, 25 December 2013 (UTC)

Do we actually need any chart? bd2412 T 17:15, 25 December 2013 (UTC)

If it comes down to it, no I guess we don't. I do think the graph enhances the article and it seems wrong to remove a legitimate graph (rewarding) for what appears to be illogical reasons, repetition of disproven assertions, and misapplication of verifiability policy, thus encouraging similar conflicts in the future based on the same reasoning and tactics. I rather see a consensus reject the arguments made. But yes, if we wanted to come to agreement that the article would be better served with no graph of tax rates, I'd be fine with that discussion (just not based on the reasons EllenCT has put forward). Morphh 19:48, 25 December 2013 (UTC)

Are we going to remove all the page's other charts too? Because I strongly object to removing a perfectly legitimate chart, one of the most informative and unbiased charts in the article, simply because a disruptive editor who has consistently behaved irrationally at best is spiteful. She hasn't even bothered to start a section about it or construct a coherent argument. I think the chart should be re-added so such behavior isn't encouraged in the future. VictorD7 (talk) 22:26, 25 December 2013 (UTC)

Ellen said: "The meta analysis says corporations pass about half to three fourths of their taxes to consumers". False. I challenge Ellen to quote where anything she's linked to says that.

Ellen said: "...as VictorD7 has said, corporations do not pass 0% of their taxes on to their consumer customers, but closer to 50%". False. I never said any such thing, which is why she hasn't directly quoted me either.

Ellen said: "which means the ITEP graph is correct and the Peterson graph is intentionally misleading in this case". False on both counts. The ITEP graph attributes corp. taxes to capital, even approvingly citing the CBO position and railing against the notion of attributing it to consumers. The "Peterson graph" is simply a faithful and visually informative representation of Tax Policy Center data. Presumably Ellen actually has a beef with the TPC, though she has yet to offer a coherent, rational critique of it or even start a Talk Page section for the purpose of ostensibly doing so.

The TPC analysis of analyses Ellen linked to (which doesn't even mention the word "consumers" on page 17, contrary to her claims) cites several attempts to empirically study the issue that reach wildly divergent conclusions, along with criticisms of some of the studies by other studies. TPC adopted the various results as assumptions, tested them each, and reached this conclusion: "Most economic studies of corporate tax incidence acknowledge that capital will bear the bulk of the burden in the short run, but there is little consensus about the long-run incidence of the tax....This paper reaches three related conclusions. First, because wage and capital income are highly correlated, higher-income taxpayers will pay a relatively larger share of the tax, regardless of whether the corporate income tax falls on labor or capital. Second, even if capital income is broadly defined to include income accrued to tax-preferred retirement accounts, this conclusion is little-changed. Third, the incidence of the corporate tax has only a modest effect on overall progressivity simply because the tax collects only a small fraction of federal revenues....The paper uses the Tax Policy Center microsimulation model to estimate the progressivity of the corporate tax—and the tax code in general—under the alternative assumptions that capital bears 20 percent, 50 percent, or 80 percent of the corporate tax burden. Under all three assumptions, average corporate tax rates generally rise with income, indicating progressivity... Furthermore, because the corporate income tax is small relative to other tax sources, assumptions about corporate tax incidence have little effect on the overall progressivity of the tax code. This paper illustrates this point by estimating average corporate tax rates under the assumption of doubled corporate tax revenue relative to the baseline. This scenario only modestly changes the tax code’s overall progressivity. These conclusions form a single lesson about corporate tax incidence and progressivity: while corporate tax incidence may affect the allocation of resources across sectors and borders, it has little impact on the corporate tax’s progressivity. Even under drastically differing assumptions, the corporate tax is a progressive aspect of the tax code."

That's from Ellen's own source. Here's a reminder of what her primary source, ITEP, has to say: "How does ITEP estimate the incidence of corporate income taxes? It is generally agreed that corporate income taxes, at both the state and federal level, fall primarily on owners of capital. In accordance with this theory, ITEP’s incidence analyses of state corporate income taxes typically distribute the incidence of the tax according to nationwide ownership of capital assets such as stocks and bonds.....The incidence of the tax in ITEP’s analyses is generally quite progressive, because the vast majority of capital income nationwide is held by the very best-off Americans." And ITEP's lobbying arm, CTJ (Ellen's actual graph source): "The Corporate Income Tax Is Borne by Shareholders and Thus Very Progressive....Corporate leaders sometimes assert that corporate income taxes are really borne by workers or consumers. But virtually all tax experts, including those at the Congressional Budget Office, the Congressional Research Service and the Treasury Department, have concluded that the owners of stock and other capital ultimately pay most corporate taxes. Further, corporate leaders would not lobby Congress to lower these taxes if they did not believe their shareholders (the owners of corporations) ultimately paid them. (In contrast, corporations do not lobby for lower payroll taxes, which are borne by workers)."

Here's a survey of peer reviewed literature by a CBO employee, which is far more credible and authoritative than Ellen's shaky personal opinions: "For years following the publication of Harberger’s seminal paper in 1962, his conclusion—that the burden of the corporate tax tends to fall entirely on capital—has largely withstood modifications to his model’s underlying assumptions...Perhaps because of the early uncertainty about how to estimate corporate tax incidence, research initially turned to new methods of empirical analysis. Krzyzaniak and Musgrave (1963) used emerging regression techniques to explain rates of return on capital as a function of tax rates. They found that more than 100 percent of the tax was shifted to consumers in the short run. This result was inconsistent with theoretical models of profit maximization in competitive markets. In several studies, economists tested Krzyzaniak and Musgrave’s results, some finding contradictory results and some confirming the analysis. Cragg, Harberger, and Mieszkowski (1967) cautioned that one should be skeptical of a framework generating fragile and volatile outcomes. Around the same time that Krzyzaniak and Musgrave were conducting their empirical analysis, Harberger (1962) was developing his general equilibrium model of corporate tax incidence. Ultimately, because of the non-robust results the empirical studies offered, the research community appeared to have abandoned the empirical line of research in favor of Harberger’s model. Harberger’s model employed a drastically different approach to the direct empirical analysis by constructing a theoretical two-sector general equilibrium model to trace the effects of a tax on capital income in one sector. A primary contribution of his model to the early analysis of corporate tax incidence was that the burden of the tax is borne by factor income—capital and labor—and is not shifted forward to consumers....Based on his model specifications and his estimates for the values of the relevant elasticities, Harberger concluded that the majority of the tax burden fell on capital. Following the introduction of Harberger’s model, numerous studies made further refinements and adjustments to the original model. Although those studies sometimes yielded different results, none of the studies ruled out the possibility that, under largely reasonable assumptions, capital would bear a large share of the corporate tax burden." (after analyzing four more recent studies with divergent results...) "Taken together, these results, albeit imperfect, suggest that an assumption that 40 percent of the corporate tax burden falls on labor and 60 percent falls on capital is consistent with open-economy models and with the current empirical evidence regarding the appropriate parameter values for those models"...(after reviewing further studies and approaches...) "This review suggests that the assumption of an open economy is not sufficient to conclude that much of the burden of the corporate tax is shifted to labor. Indeed, assumptions of highly mobile capital and highly substitutable products, internationally, are needed to ensure that the majority of the tax is borne by labor. Relaxing the assumptions of perfect mobility changes the burden allocation to indicate that, even in an open economy, a majority of the corporate tax burden, perhaps 60 percent, is still borne by capital. In addition, concerns arise over the reliance on these empirically-based general equilibrium models, extensively developed as they are, because they cannot fully reflect important aspects of the U.S. corporate tax or the nature of global interactions with other countries. Existing evidence of the linkage between U.S. tax policy and that of other countries suggests, at least with regard to the burden of the corporate income tax, that the United States operates in more of a closed economy than these models assume, even with the imperfect international mobility assumptions, suggesting capital would bear the bulk of the corporate tax. The nature of these models is to measure changes in the corporate tax and may not be appropriate for allocating the full amount of an existing tax. Given that the worldwide corporate tax should fall on worldwide capital, an alternative approach to determining the incidence of the current corporate tax may be to allocate the worldwide average to capital and to allocate country deviations from that average as changes in the corporate tax, using the open-economy model’s estimates. Under this approach, more than 90 percent of the burden of the corporate tax should be allocated to capital. Even when using the standard open-economy models, it is clear that minor additions of rigidity through immobile capital or imperfect product substitution can result in capital bearing a major portion of the tax. The open economy assumption should not be synonymous with the conclusion that labor bears more of the burden of the corporate tax than capital does."

Ellen's Altshuler paper also starts by acknowledging the 1962 Harberger study that found "the corporate tax is likely borne by all owners of capital" and that has held sway for decades, calling it "seminal". The paper goes on to analyze some recent studies finding that labor bears a large portion of corporate taxes, but cites some other recent studies that disagree. The word "consumers" doesn't appear in the Altshuler piece. It also features industry specific wage burden impacts. Obviously people don't just shop at the company they work for.

So we've got the experts agreeing that the model showing capital bearing most or all of the corporate tax burden has held sway in scholarly research for decades. In recent years there's been an increase in studies exploring the possibility that under different assumptions labor might bear at least a significant minority of the burden (though the ranges differ sharply), at least in the long term, though those studies have been criticized by other studies and the long term empirical situation lacks a clear consensus.

Meanwhile all three tax incidence sources have traditionally attributed all corporate taxes to capital, though very recently the CBO and Tax Policy Center have modified their methodologies to attribute most to capital and a minority to labor, including in the TPC chart being discussed. ITEP apparently still attributes corporate taxes solely to capital. Ellen's own link points out that corporate taxes are still progressive under even drastically differing capital/labor incidence assumptions (by contrast, consumption taxes are generally considered considered to be regressive), and are too small a component of federal revenue to significantly impact overall progressivity anyway. Even then the TPC/PGPF chart helpfully color codes the component breakdown so readers can see the corporate tax and set it aside if they want to. This entire corporate incidence tangent by Ellen is a red herring, and her statements have proved false on multiple levels. VictorD7 (talk) 01:31, 26 December 2013 (UTC)

VictorD7 said, "I tend to agree with you that corporate income taxes are passed on to consumers." I will no longer cooperate with this transparent pathetic attempt to try to disrupt Misplaced Pages to push his political point of view. EllenCT (talk) 02:41, 26 December 2013 (UTC)

It's dishonest of you to add the period inside the quote, as I've warned you before (, ). Here's my actual quote: "I tend to agree with you that corporate income taxes are passed on to consumers and others, but then I think other taxes are at least partially passed on in various ways too, as I illustrated earlier with my income tax hike on the rich guy comments. That said, if one is going to develop effective tax rate incidence charts, then corporate taxes should be imputed to the owners, since they're the ones most directly paying them." It was all the same post, Ellen; not even a later update. In the past you've even falsely accused me of stating that consumers bear "half" the corporate tax burden, and your repeated mischaracterizations despite me repeatedly setting the record straight demonstrate bad faith. It's unclear why my personal views are even important to you. You should invest more time into actually constructing an argument for your position. The context of the first exchange is also instructive in highlighting your poor reading comprehension and general incompetence, since that very quote was part of a corrective reply to you after you somehow misinterpreted the TPC page to the point where you claimed that group attributed taxes to "employees, and not even the owners". I had to spoonfeed you the pertinent sentences saying otherwise, at which point you exhibited surprise and indicated you'd study the matter later. VictorD7 (talk) 04:50, 26 December 2013 (UTC)

Still waiting for your source quote about "consumers", and for you to address the actual surveys of peer review literature I posted above that refute your claims. VictorD7 (talk) 04:42, 26 December 2013 (UTC)

I note that VictorD7 has still been unable to find any peer reviewed sources which agree with his newfound belief that corporations don't pass any of their taxes to their customers. I remain as unconvinced and disapproving as ever. EllenCT (talk) 05:43, 26 December 2013 (UTC)

Still waiting for Ellen's "peer reviewed" quote about "consumers" bearing "half to three fourths" of the corporate tax burden. Or anything pertinent about "consumers". VictorD7 (talk) 07:21, 26 December 2013 (UTC)

Victor, while I know this discussion is extremely hair pulling - please WP:NPA. Morphh 14:51, 26 December 2013 (UTC)

Ellen, since you keep repeating several things which I find contrary to the evidence, could you please answer these questions: Morphh 14:58, 26 December 2013 (UTC)

1. Why do you believe the ITEP attributes corporate incidence to consumers when their documents seem to suggest otherwise? Do you have a source from ITEP that describes their methodology for that graph as different from what their FAQ states?
2. Considering WP:WEIGHT, why do you believe the graph should attribute incidence to consumers, when in practice, none of the leading governmental organizations and independent tax policy centers, who use generally accepted peer-review methodologies, attribute the incidence directly to consumers (though they may be represented to some extent in the other groups)?
3. What type of evidence are you looking for that would convince you?

Gladly! (1) Because the ITEP's paper series and website is not peer reviewed, and they clearly have been slacking off letting people who can't get their ideas through peer review edit their website. (2) Because economic models which do not attribute about half of corporate taxes to consumers make less accurate predictions than those that do. (3) If you were to phone or email the ITEP people in charge of their graphs, and ask them to publish a clarification of these issues, that would convince me that you are interested in the truth. I've reached out to them but I don't want you to take my word for it if I have to do it again. I am sure they will help. Please let me know if that is something you are willing to do. EllenCT (talk) 03:20, 27 December 2013 (UTC)

I'll respond in reverse order. (3) I have emailed ITEP asking for clarification. (2) I understand that's your opinion, but it's not the current consensus of mainstream economics. (1) I don't think you answered the question, unless emailing ITEP was the response. The ITEP website and regular publications, like most tax policy institutes (I expect you meant to say TPC), is not what we would generally call peer reviewed. Few websites or paper series that provide statistic updates using existing models are considered for peer-review publications. Peer-reviewed journal publications are usually for new methodologies and research. Here is the corporate tax analysis that is the next article in that same March 2013 NTJ you posed earlier, which concludes 82% capital, 18% labor. Here is the previous article in that same March 2013 NTJ which places more than 90% of the corporate tax on domestic capital. And the one prior to that, which finds labor has thus far remained insulated from the corporate tax. Point being, peer-review in itself does not make scholarly consensus. New stuff comes out all the time - it will be reviewed by the CBO, Treasury, and tax institutes who may adjust their future models based on the totality of research. What you will often see in new publications is a previous published model being sourced and used, which is the case with the TPC model. So while I wait for my email response from ITEP, I'll add another question.

4. Why do you believe that the Urban-Brookings microsimulation model is not peer-reviewed? There are lots of National Tax Journal hits and it's similar to the assumptions made by the CBO and Treasury.

Morphh 16:21, 27 December 2013 (UTC)

Now do you understand why I think trying to push a propaganda chart saying 0% is so pathetic? The rich abuse the trust of libertarians. EllenCT (talk) 01:40, 29 December 2013 (UTC)

I don't understand what you're talking about. Please tell me what you think the breakdown is of the TPC corporate incidence and that of the ITEP (listed above in block quote). TPC attributes 20% to labor, if that's what you're referencing, it's not 0%. I don't even want to know how libertarians got pulled into this. Morphh 03:48, 29 December 2013 (UTC)

I have never said that the peer reviewed literature does not present a range of figures, only that the most recent and reliable peer reviewed secondary literature is usually just over 50%. The rich all too often manipulate statistics to try to falsely appeal to libertarians and the protestant work ethic. Arguing that corporations never pass taxes on to their consumers when you know that they do is a symptom of having fallen for it. EllenCT (talk) 03:56, 29 December 2013 (UTC)

Does the ITEP use over 50%? Based on their FAQ, they're the one at 0%. In any case, of the four articles published in the 2013 NTJ, only one suggested labor was a major factor (the one you referenced). None of them suggested consumers. While they may be the most recent, that works against them as they've not had any impact yet on mainstream economics - they fall into a tiny minority - newly published theories and models. What makes them relevant is practical use by organizations like the CBO, Treasury, and tax policy institutes after they review all the latest research. As for most reliable, that's pure speculation - they can't all be the most reliable. We're not here to cherry pick what you think is the most reliable. We'll use the industry consensus, which the TPC does. Morphh 04:30, 29 December 2013 (UTC)

How do you get 0% as a consensus after citing several papers, none of which are near 0%? EllenCT (talk) 06:51, 30 December 2013 (UTC)

It sounds like you're confusing labor with consumers. Several of those studies show incidence on labor, but I don't see any of them concluding incidence on consumers. Only one of those papers mentions consumers (Gravelle) while discussing the work of Harberger (1962) and Krzyzaniak and Musgrave (1963). So I'm not sure what you're talking about. Based on those four NTJ publications, they tend to place incidence on capital and labor to varying degrees. The point though is that these publications are not relevant - they represent new research in the field, not the current scientific consensus. We shouldn't look to them for the basis of weight. Morphh 15:22, 30 December 2013 (UTC)

Labor and consumers have a huge overlap in the U.S., more than 85% on a per-dollar basis if I remember correctly. I forget what the two per-person subset ratios are, but the point is that they are both mostly the same populations. EllenCT (talk) 01:04, 31 December 2013 (UTC)

Even if we take a 50% labor / 50% capital model, which doesn't appear to be used outside of research papers, it's still highly progressive with over 50% of the burden falling on the top 10% and half of that falling on the top 1%. So, you're not going to see some dramatic regressive new picture. Morphh 13:31, 31 December 2013 (UTC)

Consumers are about 69% of the economy per dollar and labor is 58.5% per capita. The number of unemployed people who are consumers is relatively small per dollar. And the number of employed people who aren't consumers is very close to zero too. I don't understand how the tax rates you made me word so carefully on Income tax in the United States would lead you to believe that reality is anything more progressive than what the ITEP graph shows, because sales, payroll, and property tax are all more regressive than income tax. EllenCT (talk) 14:51, 31 December 2013 (UTC)

Ellen said: "Labor and consumers have a huge overlap in the U.S.". I'll say. 100% of people with jobs (and at least most without) are consumers (many are also investors/corporate owners). But there's still a huge difference between taxing consumption (consumers) and taxing income (labor). The studies are referring to the mechanics of incidence. VictorD7 (talk) 19:07, 31 December 2013 (UTC)

As I've said before, even if ITEP does quietly attribute half to consumers, since all their public stances do the opposite, it would only undermine their credibility as a source. It would mean they've been publicly supporting the corporate tax as "very progressive" and railing against the notion of attributing to consumers while secretly scoring otherwise to make overall taxation look less progressive than it really is; dealing off both sides of the deck. Then there's the matter of why their state numbers (linked in various places on this page) only attribute corporate taxes to the top 5%, with the highest rate going to the top 1%, if they're attributing half to consumers. VictorD7 (talk) 19:55, 27 December 2013 (UTC)

If Ellen refuses to answer the questions we should restore the legitimate chart. VictorD7 (talk) 19:26, 29 December 2013 (UTC)

Victor, you need to answer the questions about this exact issue you said you would answer weeks ago. Are you true to your word? The Peterson Foundation chart is certainly not legitimate, the ITEP chart is the legitimate one. EllenCT (talk) 06:49, 30 December 2013 (UTC)

Is it possible to create a chart that reflects the points upon which everyone agrees; or conversely, to present both views and point to the sources contesting each? I'm a big fan of teaching the controversy. If there are groups out there who believe different things, then we should explain both sets of beliefs, and explain why each thinks the other is wrong (so long as there are sources for the propositions and counter-propositions at issue). bd2412 T 20:49, 29 December 2013 (UTC)

No, because there aren't two different coherent points of view here, as evidenced by one editor refusing to answer vital questions or addressing posted evidence. VictorD7 (talk) 05:25, 30 December 2013 (UTC)

Bullshit. Victor is the one who has been avoiding answering questions for weeks now. EllenCT (talk) 06:49, 30 December 2013 (UTC)

I agree with your philosophy, but this is probably not the best article to dig into varying models of corporate tax incidence. It's a high level article and I think we're dealing with WP:VALID. But let me pose this, which would be necessary to implement that idea; if we were to create a new graph of the corporate tax across these percentiles, can Ellen provide a source that specifically presents the data for federal corporate tax burdens using the methodology she suggests? To be clear, I don't want a link to the ITEP graph. I'd like actual data that is specific to (or specifically breaks out) corporate taxes with a clear explanation of the methodology. Morphh 16:08, 30 December 2013 (UTC)

ITEP chart is disputed by multiple sources.

This chart's internal federal component shows higher rates for low income earners and lower rates for high income earners than the Tax Policy Center and CBO (,) do. The difference is especially pronounced for the top 1%, with ITEP typically placing it around 20% while the other two sources put it around 30% (federal alone; give or take a couple of points).

Effective Federal Tax Rate for the Top 1% in 2011

TPC - 30.4%

CTJ - 21.1%

This is a huge difference, and it's consistent over time, not a one year fluke (I've posted links for other years before and can do so again if necessary). ITEP's methodology has also been directly criticized by the Tax Foundation. At best ITEP's chart is hotly disputed, and is therefore unfit to be given the prominence of an article image, much less an implicitly definitive one near the top of the page.

I'll add that Ellen has tried to make the argument on other pages, repeated in her edit summary here, that the massive discrepancy is due to ITEP attributing half of its corporate incidence to consumers (with regressive results), contrary to the CBO and TPC attributing to capital owners (with progressive results). She's posted absolutely no evidence of this, and her claim is contradicted by ITEP's public comments. I'll just post a few for now:

• ITEP FAQ: "How does ITEP estimate the incidence of corporate income taxes? It is generally agreed that corporate income taxes, at both the state and federal level, fall primarily on owners of capital. In accordance with this theory, ITEP’s incidence analyses of state corporate income taxes typically distribute the incidence of the tax according to nationwide ownership of capital assets such as stocks and bonds.....The incidence of the tax in ITEP’s analyses is generally quite progressive, because the vast majority of capital income nationwide is held by the very best-off Americans."

• WSJ piece hosted on ITEP's site: "All taxes have to be paid by somebody at some point," says Steve Wamhoff, legislative director at Citizens for Tax Justice, the liberal lobbying arm of the Institute on Taxation and Economic Policy, a research group. "The corporate tax is paid by the owners of corporate stock and business assets."

• When one searches on the ITEP site for "corporate taxes", near the top this piece pops up by CTJ (the chart source), ITEP's "sister" group and "lobbying arm": "The Corporate Income Tax Is Borne by Shareholders and Thus Very Progressive....Corporate leaders sometimes assert that corporate income taxes are really borne by workers or consumers. But virtually all tax experts, including those at the Congressional Budget Office, the Congressional Research Service and the Treasury Department, have concluded that the owners of stock and other capital ultimately pay most corporate taxes. Further, corporate leaders would not lobby Congress to lower these taxes if they did not believe their shareholders (the owners of corporations) ultimately paid them. (In contrast, corporations do not lobby for lower payroll taxes, which are borne by workers)."

• CTJ reiterates that view in this testimony before the Congressional Progressive Caucus (page 7): "The owners of corporate stocks and business assets — which are concentrated among the rich — ultimately pay corporate income taxes. Corporate leaders and their lobbyists argue that corporate taxes are ultimately paid by workers who suffer when corporations leave the U.S. to find lower taxes. This cannot be true. Corporations would not spend so much time lobbying you to lower their taxes if they did not think their shareholders were the ones ultimately paying them. Several non-partisan analysts have also concluded that the corporate income tax is mostly borne by the owners of corporate stocks and business assets."

• Furthermore, while no one has been able to produce their federal breakdown, ITEP's state by state analysis attributes zero state corporate taxes to the bottom 95% in their combined state average (page 118), and by far the highest rate to the top 1%, further undermining Ellen's claim. Nowhere in any ITEP literature produced so far have they mentioned the word "consumers" in the context of corporate taxation, except to explicitly argue against attributing to consumers. That's without getting into the fact that corporate taxes wouldn't mathematically account for the gap between the TPC and ITEP even if zero were attributed to the top 1%. Clearly the "corporate incidence" defense is a red herring that fails to explain ITEP's large discrepancy with the other sources. VictorD7 (talk) 21:52, 18 December 2013 (UTC)

I have concerns myself with using their material and I've often found points of criticism with their methods. Usually it's something we can present in the context of a point of view, attributing the material and providing a counter-balance point of view, such as the Tax Foundation. But since this is such a high level article, I have problems with including it. We'd running into NPOV issues to include WP:WEIGHT. If we include anything for such all encompassing graph (which doesn't seem useful since states can vary greatly), I would much prefer something from a more neutral source. Morphh 22:16, 18 December 2013 (UTC)

This has been discussed in detail at Talk:United States#Quality of sources on corporate tax incidence where VictorD7 has repeatedly refused to answer my questions after saying he would do so (oh, I'm sorry, "after the ITEP thing is resolved.") I please try to read through it and let me know what you think. EllenCT (talk) 03:22, 19 December 2013 (UTC)

I'll try to read through it tomorrow, but honestly, anything that creates that much discussion / debate probably shouldn't be included in a high level article like this. Morphh 03:47, 19 December 2013 (UTC)

For the record, Ellen's opening paragraph in the section she linked to is stuffed with falsehoods, especially about me and what I've said in the past about corporate incidence. My position isn't at all as she described and has been entirely consistent since long before I even encountered her. I didn't want to let her derail and distract from the pertinent portion of the discussion, which is why I'm waiting until after it's settled to answer her long list of questions, but I also know unchallenged BS can set into people's minds, so take what she says with a heap of salt. VictorD7 (talk) 04:44, 19 December 2013 (UTC)

Well....yeah. I'll answer your off topic ad hominem stuff as a courtesy after we settle the stuff relevant to the article, the ITEP chart you're trying to add. It's been like pulling teeth trying to get you to answer and/or address the vital questions and facts. VictorD7 (talk) 04:00, 19 December 2013 (UTC)

I will wait for you to answer the simple, yes-or-no questions about whether you've been POV-pushing as long as it takes, "as a courtesy." If I have been dishonest then the yes-or-no answers should clear all that up, right? If not, why not? EllenCT (talk) 07:44, 19 December 2013 (UTC)

Among other things, your failure to address the mountain of evidence posted above, including a direct link to ITEP's study showing them attribute corporate taxes entirely to the top 5%, and by far the highest rate to the top 1%, establishes that you aren't interested in an intellectually honest discussion. Since you're the one campaigning for changes, your refusal to answer questions or address evidence is unwise. I hope you're not holding your breath. VictorD7 (talk) 01:15, 20 December 2013 (UTC)

EllenCT, why are you removing the TPC graph? The source of that graph has been discussed. The graph is a direct representation of the TPC data, so there is no issue with the source. The PGPF, whatever their perceived bias, is irrelevant in creating the graph - I could recreate the graph myself and it would be acceptable as it directly represents the TPC table. I certainly find it inconsistent that you object to this direct translation, but go through weeks of dispute and RFC to push a graph that is based on original research and discuss merging graphs with different X/Y axis into a single graph, likely SYN. Morphh 13:57, 19 December 2013 (UTC)

Because I think it is very misleading to try to show that the top 1% pays more taxes than the top 20%, in a political way. It is a direct reaction to Warren Buffet noting that he pays less of a percentage of his income than his secretary. EllenCT (talk) 00:42, 20 December 2013 (UTC)

That's not what you stated when you removed the graph and your assessment for the data is inaccurate - FactCheck. You only start to see a decline when you get to .1%, which is due to capital gain rates (lowered to encourage investment, which has to work against risk and inflation). Morphh 22:00, 20 December 2013 (UTC)

I'm also not sure how a graph that tries to lump state & local (which can very wildly) and federal taxes along with mixing different tax systems (income & consumption) is in any way superior. You can't even measure these the same way. Any such graph is filled with tons of assumptions and heavily modeled for tax incidence and considering the source, highly partisan. It's not even clear how they came up with these figures. If you're going to include graphs on taxation, federal taxation should be a different graph than state taxation (like the TPC graph), and consumption taxation should be separate from income taxation when showing distributional effects in order to make any logical sense out of the graph. Morphh 14:59, 19 December 2013 (UTC)

All taxes can be measured as a percentage of a population's income, and doing so adjusts for inflation and purchasing power. EllenCT (talk) 00:42, 20 December 2013 (UTC)

Yeah, the only complaint about the TPC chart was raised weeks ago and was based on false premises that were easily cleared up. VictorD7 (talk) 18:00, 19 December 2013 (UTC)

Since both graphs are clearly in dispute and the respondents at Talk:United States are deciding on which is superior, I propose that both be removed until the matter is resolved. EllenCT (talk) 00:42, 20 December 2013 (UTC)

You still have yet to articulate an objection to the TPC chart, so it's not being rationally disputed. It's also the status quo, and would require decisive consensus to remove. And you didn't even characterize the Talk US discussion correctly. The discussion is about whether to include your ITEP/CTJ chart, and last I checked the vote was 7 opposed to 3 support. In fact all your latest proposals are being rejected as blatantly partisan POV pushing, among other reasons. VictorD7 (talk) 01:15, 20 December 2013 (UTC)

Your statement shows you either lack the competence required for reading comprehension to read the objection above, or you have decided that attempts to deceive make an effective editing strategy. EllenCT (talk) 22:03, 20 December 2013 (UTC)

You mean your Warren Buffet comment? All that did was confirm your partisan agenda. By "articulate an objection" I meant something rational, with facts and evidence. That you accused the Tax Policy Center, a liberal leaning group, of throwing something together just to react to something a Democrat celebrity said demonstrates that you have no idea what you're talking about. While I often disagree with the TPC's policy opinions and subjective interpretations, their hard tax incidence data has been widely cited and respected across the political spectrum for years. They're a vastly superior source to an offhand talking point by Warren Buffet. VictorD7 (talk) 01:45, 21 December 2013 (UTC)

EllenCT, the TPC is not deceive. We should not be excluding a graph because it doesn't have a separate measure for the .001% Warren Buffets - that would be modifying a graph to push an agenda. The deciles need to be logical for a general article. Morphh 13:44, 21 December 2013 (UTC)

The Peterson Foundation graph of unreviewed TPC numbers is a deliberate attempt to try to show that taxes are progressive for the top 1%, which is not true. The ITEP graph, which I replaced it with, agrees with the peer reviewed sources that about half of corporate taxes are borne by their customers, meaning that about half fall on consumers. EllenCT (talk) 01:10, 22 December 2013 (UTC)

As I said above, federal rates are progressive for the top 1% - FactCheck. I'm still trying to figure out what the ITEP measured. Based on their FAQ, they don't split the corporate tax as you state. Morphh 02:26, 22 December 2013 (UTC)

Without digging into the ITEP figures, it looks like they're getting the regression via state and local sales taxes. I've seen bias publications that manipulate sales tax incidence by measuring via a single year and do so on a base other than that which is taxed (using income instead of consumption) without adjustment. What they do (looks like ITEP does this in their State by State), which is mathematically invalid, is treat any savings as completely tax free for that year, not tax deferred for future spending. Example, 10% sales tax - spend $80,000, save $20,000. They calculate that at a 10% of 80,000 = $8,000 / $100,000 = 8%. The more you save, the lower your average tax rate. So they report an 8% rate on $100,000, but what about the other $20,000? Poof - never to be taxed again (don't look at that hand - forget retirement, child's college, future spending - it's gone). They "forget" to model into that year the expected revenue on the saved income on future consumption. That's why I hate when mixing income and consumption into a single graph, because it's so easy to manipulate. The more taxes you mash into a graph, the more difficult it is for the graph to be unbiased. Morphh 03:40, 22 December 2013 (UTC)

There is also a bias with showing consumption rates on low income. Many low income consumers are high spenders (and this is not due to credit) - what the data shows is much consumption is via savings. As people retire (those that hold the vast majority of U.S. wealth), their incomes decrease as they shift to savings, so they have high consumption, low income - this biases a graph like this to show "low income" people with a higher tax rate than what their wealth would otherwise show. It's biased against workers and saving. Another reason to show incidence on what is actually taxed. If you're spending $50,000, but your income is only $25,000 - their average tax rate "on income" is going to show a much higher rate on that consumption than it would otherwise be. Morphh 04:29, 22

December 2013 (UTC)

As I review their research a bit more, it looks like they're really distorting the sales taxes - quite severely. There is way too much "interpretation" for this graph to be included in anything on Misplaced Pages. Morphh 04:29, 22 December 2013 (UTC)

Which specific figures are you referring to? EllenCT (talk) 12:37, 22 December 2013 (UTC)

This is likely the state figures included in their mashup graph. Who Pays? A Distributional Analysis of the Tax Systems in All 50 States, Institute on Taxation & Economic Policy Morphh 14:13, 22 December 2013 (UTC)

There is also the question on how they split local property taxes on commercial property, do they fall to the owner, to the renter, or to the consumer? To my point above, this is another reason why mixing the graph of federal with state / local can create a bias graph, since each of these tax models can have many assumptions as to the incidence. Morphh 03:58, 22 December 2013 (UTC)

ITEP chooses incidences which are most likely to predict outcomes from prior historical data. EllenCT (talk) 12:37, 22 December 2013 (UTC)

Ya, I'm sure they do... Their FAQ doesn't state their method. Their complete publication on the State by State under the Models they use only says it "analyzes revenue yield and incidence of current state and local property taxes." Either way.. I don't care, the point was that mixing state/local with federal is a bad idea for a graph as it's easy to introduce a lot of bias. Morphh 14:20, 22 December 2013 (UTC)

Are you being serious or sarcastic? Why do you keep including the Peterson Foundation graph which only shows income tax and assumes corporations never pass their taxes on to their customers? EllenCT (talk) 04:53, 24 December 2013 (UTC)

Fourth opinion

I'll weigh in here briefly, responding to User:VictorD7's initial objection. Bottom line upfront, I think the chart is OK and there are several errors in the criticisms presented:

• The first point about the ITEP numbers differing from the TPC in federal income tax appears to be due to conflating average rates with average effective rates. The TPC link provided specifically describes "average federal income tax rate" without the key word "effective". The CTJ figure more closely lines up with the IRS figures (e.g., in 2007 it was 20.6% per Income_tax_in_the_United_States#Effective_income_tax_rates) and makes sense given the importance of capital gains and dividends to this bracket. It also lines up with what you see if you look at other pages (e.g., top 400 effective (I calculate at max 23.7% which assumes the max of the ranges presented) and effective tax rate by income (where for 2009 in the 200k+ category composed of the top 3% or so only 1.8% are in the 30 to 35, 16.7% in the 25 to 30% and everyone else below and yet the "average federal rate" for the 1% is is 28.9% which seems like an inconsistent jump). I suspect the same thing is going on with the CBO which also doesn't say "effective".
• There's a link to a criticism by the Tax Foundation, but this mainly criticizes the policy recommendations. The only methodology criticism I could find was that "Including the federal offset in an analysis of state and local tax structures is misleading because it is a feature of the federal tax code, not state and local tax systems". Doesn't seem particularly relevant for our discussion here.
• With regard to incidence, while I didn't follow the links, based on the quotes it does appear that ITEP doesn't assume the incidence falls on consumers. This means it's probably a more fair comparison; if the incidence were even slightly on consumers, the effective would be regressive.

The difference in the federal rate is due to effective rates which are lower due to the long-term capital gains rate of 15% along with qualified dividends at 15%, and it is quite consistent with the available data. I don't see a good reason to exclude the chart in these arguments. II | (t - c) 05:45, 31 December 2013 (UTC) Another source I see you guys have discussed is the Peterson Foundation's chart. How did the effective income tax rate for the 1% go from 20% to about 24% in their final graph? They say this excludes state income taxes. II | (t - c) 07:06, 31 December 2013 (UTC)

II, The TPC does describe effective - the title of the data for the chart is "Average Effective Federal Tax Rates". The TPC link you specify above saying that it doesn't provide the keyword "effective" does so in the notes at the bottom. Average describes the effective rate in the deciles. I'm not sure I understand why you're comparing Bush era 2007 data as closely matching CTJ when we're looking at current data. As for the top 400, that's the top .000004%. Such a decile makes no sense when trying to neutrally present the overall burden in a top level article like this. As for capital gains and dividends, TPC references "Measuring Income for Distributional Analysis” (July, 2013) as their analysis, which appears to include them. As for the ITEP/CTJ chart, my biggest problem is not their analysis of federal taxes, though I see no actual data or breakdown behind it to analyze (as you've done with TPC). The primary issue for me is that it combines federal, state, and local, which is over 100+ tax systems into a single statistic, which makes it fairly useless and subject to a lot of assumptions (and bias). We're detailing the TPC graph because you can actually see the taxes represented (and they're just Federal), where the ITEP graph has no distinction for anything. There is no distinction in the graph between taxes (federal, state, local) or even the type of taxes, income (with subgroups) or consumption (with subgroups). The models they use on consumption can be very misleading when combine with the same measure for income taxes, as it appears there is little accounting for future consumption of savings (or the way income/wealth is measured in the different systems). If you were to split the ITEP graph in two pieces, Federal and then State, at least that would make some sense, though I even question combining all the states in one graph as they can be so dramatically different. It's like if you mashed each state bird into a single creature and said, this is what the U.S. bird looks like. There is just far too much interpretation in a graph like that for a high level article - it'd take another dozen graphs to comply with NPOV. Morphh 14:48, 31 December 2013 (UTC)

(insert) Morphh already corrected most of your points, but I'll add or reiterate a few things:

• "Effective tax rate" means "average tax rate" ("or average effective tax rate"). From Investopedia: "Definition of 'Effective Tax Rate' The average rate at which an individual or corporation is taxed." That's why groups like the CBO and TPC use the terms interchangeably.

• The first link you provided and claimed was the "TPC link" I provided is actually a list of CBO figures hosted on the TPC site (read the fine print; why I listed it after "CBO"). The most pertinent TPC source used above is this one, titled "Average Effective Federal Tax Rates".

• The 2007 "IRS" figures you link to appear to be only for personal income and payroll taxes (as the chart says), excluding things like corporate taxes. The CTJ figures, by contrast, purport to be for all taxes, so they shouldn't match up. Your article chart is actually just sourced to a short NY Times piece that only lists "Congressional Budget Office, 2007 data" as its source, not the IRS. No data set is provided, but the numbers look pretty close to what TPC and CBO sources typically give for just personal income plus payroll.

• The $200k+ level includes a lot more than the top 1%, as you say yourself, and I'm not sure why you feel the given figures seem out of whack. Your TPC link doesn't provide a breakdown for the top 1%, but the 28.9% rate you cite (which is actually the CBO number) seems in the right ballpark for that year given the numbers presented (2009 was a down year for tax rates due to the recession). About a fifth of those making 200k+ paid over 25% (a majority of the top 1%), and there's likely more skewing at top than at the bottom, with small numbers paying up to 80% and beyond. VictorD7 (talk) 21:10, 31 December 2013 (UTC)

• The Tax Foundation criticizes ITEP for selectively applied methodology and then presents an alternative chart of total taxation based on more reliable TPC federal rates that shows a markedly different picture. All that also underscores the legitimacy of comparing and contrasting TPC and ITEP federal rates.

• The PGPF page you linked to isn't the source page linked to by the chart discussed in the above section. This one is. That page's caption correctly describes the TPC source. The chart you refer to on the other page is from a different year than the previous one, and has an incorrect caption. I'm guessing it was a software glitch that automatically updated it on more than one page. Of course none of that is relevant to this discussion.

• I appreciate that you took the time to read the quotes and conclude that ITEP doesn't appear to attribute corporate taxes to consumers. VictorD7 (talk) 21:10, 31 December 2013 (UTC)

The Peterson Foundation graph is limited to federal income taxes only. The ITEP is a sum of all taxes, federal state, and local, income, capital gains, payroll, excise, sales, and property. Therefore the ITEP graph is clearly more appropriate for this article. Why should we include a chart about only one kind of tax in only one of three or more jurisdictions typical in the U.S. in this article? Even if you believe the Peterson Foundation effort (I would not use the term "valiant", II) to try to convince you that corporations never pass taxes on to their customers, which even VictorD7 doesn't believe, it's not even appropriate for the income tax in the US article because it omits state, county, district, and local income taxes. EllenCT (talk) 15:19, 31 December 2013 (UTC)

If you want to present different types of tax systems, then include multiple graphs that we can discern what is being measured. Then attribute in the caption what the graph measures and who measured it. The reference to Peterson Foundation is ad hominem - the graph accurately reflects the TPC data. And the TPC doesn't "try to convince you that corporations never pass taxes on to their customers". They pass more incidence to labor than the ITEP does. If you want to include an ITEP measure of state / local, then get a graph for state / local. Then we could balance it with the Tax Foundation measure of the same data, who is critical of ITEP, to comply with NPOV. The Frankenstein ITEP graph is inappropriate on multiple levels. Morphh 15:50, 31 December 2013 (UTC)

Without a legend, a description of what exactly is being measured (including the assigned pass-through rates to customers and to labor), and evidence that ITEP is expert on all the types of taxes described, the chart is misleading or wrong. I don't fully agree with Morphh that the different types of taxes (probably with different assigned pass-through rates) should be broken out, but a number of charts with different assumptions are needed if the ITEP chart is to be given. The Peterson chart is, perhaps not suitable for this article, but is unlikely to be misleading, even if inconsistent with the ITEP chart. — Arthur Rubin (talk) 18:00, 31 December 2013 (UTC)

You know the old saying, "lies, damn lies, and statistics". There are books out there about how you can make the numbers say whatever you want by how you present the chart. For that reason, it may be best to keep charts simple, and avoid combining different kinds of figures that are calculated by different methods. bd2412 T 19:17, 31 December 2013 (UTC)

Let's keep in mind that the section disputed for the TPC graph is Income taxes. We already have an ITEP graph in the article for state sales taxes (shown on the right). I don't think a graph like that is meaningful, but at least it's one tax type and other viewpoints/models can be better compared. A different approach to 50 states would be something like this composition graph of state and local tax revenues. It doesn't describe burden, but it presents a nice look at the state / local tax structure. A corresponding graph that lists the relative tax burden of each state would provide more meaningful information, then something like the ITEP graph (who pays 2.1% sales tax rate?). Morphh 20:13, 31 December 2013 (UTC)

Since Ellen's objections to the TPC chart have been systematically debunked, would you oppose me re-adding it soon? VictorD7 (talk) 22:13, 4 January 2014 (UTC)

VictorD7 is still unable to come up with a single peer reviewed source agreeing with his newfound belief that corporations pass 0% of their taxes on to their customers, and is shown here continuing his abusive pattern and practice of trying to lie to other editors in a continuing, misguided, and pathetic attempt to insert his political opinions based on non-peer reviewed sources. EllenCT (talk) 06:52, 5 January 2014 (UTC)

You mean like this (Harberger, 1962, pp 217, 219, 234)? "This result is taken by some people as evidence that the burden of the corporation tax is borne by consumers, that is, that the tax is shifted forward. Such an inference is far wide of the mark…Insofar as individual consumers have the same expenditure pattern as the average of all consumers, they neither gain nor lose in their role as consumers….If we are prepared to accept this canceling of gains and losses as the basis for as statement that consumers as a group do not suffer as a consequence of the tax, then we can conclude that capital bears the tax....It is hard to avoid the conclusion that multiple plausible alternative sets of assumptions about the relevant elasticities all yield results in which capital bears very close to 100 per cent of the tax burden." That's the paper the CBO author said had shaped the course of academic research since, and that your own source called "seminal". The peer reviewed sources invariably focus on the capital/labor split, not consumers. That doesn't have much to do with the larger debate, but even your tangential diversions are wrong. I guess you failed to read all that stuff I posted for you above. You never did post a single quote from any source (peer review or not) supporting your claims about "consumers". I also don't appreciate you continuing to lie about me. My position isn't "newfound" (and you mangled it anyway), I've been completely honest this whole time, and I'm not the one trying to shove my political opinions into this article. You are. VictorD7 (talk) 08:00, 5 January 2014 (UTC)

1962? Well I guess that is something of an improvement, but "very close to 100%" is not the 100% in light of the several peer reviewed sources I posted from the last two decades, including the secondary meta-analyses, which are all closer to 50%. However, I commend you for finally finding the peer reviewed literature. Please read its more recent offerings. EllenCT (talk) 08:10, 5 January 2014 (UTC)

The remainder (if any exists) would be labor, not consumers. I had already posted quotes from the CBO and your own source describing that 1962 paper as the "seminal" work that's guided the scholarship that's followed. Ever since the peer reviewed literature has broken incidence into capital/labor, not consumers, as your own sources show. Please produce a single quote supporting your claim about consumers. VictorD7 (talk) 08:30, 5 January 2014 (UTC)

I see, VictorD7 - I didn't notice that the ITEP said it included corporate income tax, so it looks like there is a strange difference. Couldn't find ITEP's tax model which was cited in that paper either. Would appreciate it if Morphh could let us know what they say if they respond to his email. Not sure I agree with allocating all or most of the corporate income tax to owners but that's something I'll have to look into a little more. II | (t - c) 21:21, 1 January 2014 (UTC)

Employment Graphs

I noticed these two graphs in the article. The seem POV and I don't see how they're helpful to the average reader. Morphh 20:23, 31 December 2013 (UTC)

Misplaced Pages has an article on Effect of taxes and subsidies on price. I would propose that we separate out materials like this into an article on Effect of taxes on employment, and let that be the venue for presenting the various claims about the taxation/employment relationship. Of course, that issue is not unique to the United States anyway. bd2412 T 20:34, 31 December 2013 (UTC)

Clearly POV and a dubious conclusion at that. Those charts should go. They're sourced to a NY Times opinion piece attacking Romney's tax plan during the height of the 2012 campaign. One author, Zidar, is just a Berkeley grad student and the column's coauthor worked for Bill Clinton's Council of Economic Advisers. Zidar also claims to have "recently" worked on the Council of Economic Advisers, presumably under Obama. The chart I'm adding to the right should go too. Its labeled source is the Congressional Research Service, but it was written by Thomas Hungerford, an Obama donor, also during the height of the 2012 campaign, and was retracted by an embarrassed CRS after widespread criticism of its shoddy methodology, and for being a transparent, low quality partisan joke. I think it was re-released in 2013 in an altered form (the graph is sourced to the original version), but that has received widespread criticism too, and this page shouldn't be about making political arguments on complex, hotly disputed issues. VictorD7 (talk) 22:14, 31 December 2013 (UTC)

I agree that this page is not the place for such arguments; however, complex, hotly disputed issues are usually notable topics worthy of encyclopedic coverage, and we should therefore have an article on the issue somewhere else. Obviously, Misplaced Pages can't champion one position or the other, but we can explain the arguments that have been made by partisans for various biases. bd2412 T 22:19, 31 December 2013 (UTC)

I wouldn't necessarily oppose that, but in the meantime we should delete the graphs here. Apart from being totally one sided, they're just inserted randomly and don't even have anything to do with the text. I'm adding a fourth one that should be removed that's also sourced to the same retracted Hungerford "report".VictorD7 (talk) 22:30, 31 December 2013 (UTC)

I have created Draft:Effect of taxes on employment, incorporating these charts but describing them as claims, not necessarily as facts. bd2412 T 23:08, 31 December 2013 (UTC)

Nice - I didn't even know we had that "draft" capability. Morphh 20:37, 1 January 2014 (UTC)

It's new - the namespace was created within the past month. bd2412 T 20:56, 1 January 2014 (UTC)

Bogus graph, original research

is cited as the source yet the graph does not appear in the paper. also, the graph cites the 2000 tax year, the paper was written in 1999. i will remove the graph without objection in 24-48 hours. Darkstar1st (talk) 18:43, 1 January 2014 (UTC)

I don't have any objection to updating this graph with a newer graph, but I looked at the source and the data does appear to be supported via Table 14 on page 24 (section As a Percent of Income) for "Distribution of Federal Taxes Under Current Law in 2000". Seems we're cleaning house on several graphs, so it shouldn't be hard to update this one as well in the process. Morphh 20:36, 1 January 2014 (UTC)

Federal tax receipts

We have these two graphs in the article. Seems they both cover the same thing and I don't think the duplication is for pov / balance reasons, so I suggest we remove one. 1950-2010 takes a historical approach, which is nice, but it's dated and not as accurate as the 2012 graph, which is noticeable with regard to income tax and payroll tax percentages. Morphh 20:14, 8 January 2014 (UTC)

The White House OMB (page 35) shows ind. income/payroll crunching to 41.5%/40% in 2010, but then diverging to 47.4% and 35.5% the very next year, 46.2%/34.5% in 2012, and estimates taking income to around 50% by 2018 and payroll to around 32%. 2010 is a strange and potentially misleading year for the chart to end, so it should probably at least be updated to 2011 or 2012 to capture the ongoing divergence. VictorD7 (talk) 21:09, 8 January 2014 (UTC)

I think the historical information is informative. If there was an image crowding issue then there would be reason for removing one of the images, however, at the moment this is not an issue. I do agree that the historical graph could be updated for more recent data. Also, the reason that the chart ends in 2010 is that it was created in 2012 based on a then current US Senate Joint Committee on Taxation report. Guest2625 (talk) 04:54, 9 January 2014 (UTC)

I agree that we should keep both, but update them - the historical chart should be extended every year to the current year, and the pie chart should always show the most recent year. Also, I am curious about the orange and light blue lines on the historical chart, since whatever the orange represents, it seems to be jumping to an all-time high in 2010. bd2412 T 05:24, 9 January 2014 (UTC)

Ya, I should have mentioned that the reason I noticed was that I was looking at adding more graphs and it was creating a crowding issue. But I guess we can cross that bridge later. Morphh 15:19, 9 January 2014 (UTC)

Tax as theft

The section is not specifically relevant to the US. Although I don't see the need for the section anywhere, it might be added to the article Taxation as theft. — Arthur Rubin (talk) 15:31, 22 March 2014 (UTC)

1. "Effective tax rates: income, payroll, corporate and estate taxes combined". Peter G. Peterson Foundation. July 1, 2013. Retrieved 3 November 2013.
2. "T13-0174 - Average Effective Federal Tax Rates by Filing Status; by Expanded Cash Income Percentile, 2014". Tax Policy Center. Jul 25, 2013. Retrieved 3 November 2013.
3. "Who Pays Taxes in America?" (PDF). Citizens for Tax Justice. 12 April 2012.
4. Carl Davis, Kelly Davis, Matthew Gardner, Robert S. McIntyre, Jeff McLynch, Alla Sapozhnikova, "Who Pays? A Distributional Analysis of the Tax Systems in All 50 States", Institute on Taxation & Economic Policy, Third Edition, November 2009, pp 118.
5. "Tax Cuts for Job Creators". New York Times. October 19, 2012.
6. (PDF). Owenzidar.files.wordpress.com. Retrieved 2013-12-18. {{cite web}}: replacement character in |title= at position 35 (help)

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