Income Tax Receipts Fell 2.6% Last Year

A reader draws my attention to a piece from Yahoo News about personal income tax payments last year:

Despite the majority of Americans receiving a tax cut, the IRS pulled in an additional $93 billion for 2018 from taxpayers on individual income taxes than it did for 2017, according to new data from the IRS. This is in part thanks to the Treasury Department processing 1.5% more individual returns for 2018 than 2017.

Huh. Did the Republican tax cut really produce more revenue? The Yahoo News reporter comes close to explaining what happened by noting that there were more returns in 2018 than 2017. As you might guess, this happens every year as the US population increases. So let’s take a look at personal income tax receipts adjusted for inflation and population growth:

In reality, income tax receipts were down 2.6 percent in 2018 compared to 2017. What this means, unsurprisingly, is that when you cut tax rates you get less revenue.

When you fail to account for things like inflation and population growth, nearly every year is an “all-time high.” But that’s meaningless. Someday our nation’s press is going to stop producing innumerate pieces on the economy and learn how to do simple adjustments that tell the real story of what’s going on. But that day is not yet.

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is the first thing despots go after. An unwavering commitment to it is probably what draws you to Mother Jones' journalism. And as we're seeing in the US and the world around, authoritarians seek to poison the discourse and the way we relate to each other because they can't stand people coming together around a shared sense of the truth—it's a huge threat to them.

Which is also a pretty great way to describe Mother Jones' mission: People coming together around the truth to hold power accountable.

And right now, we need to raise about $400,000 from our online readers over the next two months to hit our annual goal and make good on that mission. Read more about the information war we find ourselves in and how people-powered, independent reporting can and must rise to the challenge—and please support our team's truth-telling journalism with a donation if you can right now.

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