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2001 and 2003 Tax Cuts for the Rich?  Hardly.

- by Roger McEowen

Some politicians (and others) have made statements to the effect that the Bush tax cuts of 2001 and 2003 have amounted to a tax cut for the “rich.”  But is it true?  Not even close.  According to 2004 and 2005 official tax data provided by the IRS to the Congressional Budget Office, the tax cuts of 2001 and 2003 have resulted in the households within the four lowest quintiles of income range bearing a smaller share of all federal taxes, while the highest quintile’s share of federal taxes increased by 2.2 percent.  As of 2005, the households in the highest 20 percent income category paid 68.7 percent of all federal taxes (income, social security, corporate and excise). 

What can be guaranteed, however, is that failure to make the 2001 and 2003 tax cuts permanent will result in a tax increase for all taxpayers, especially the lower income households. 

Download the CBO Report. (pdf)