Saturday, March 31, 2012

A Thousand Words, Vol.1, Issue 22.

Courtesy of work on income tax reform by the Congressional Research Service, across the jump is a graph of the beneficial distribution of four tax expenditures. The information is provided in a graph of concentration curves; an adaptation of the Lorenz Curve.

The concentration of capital gain and dividend tax benefits (also known as tax expenditures) illustrates the intense inequity in the United States tax code. Americans in the highest quintile of income share get almost 60 percent of the dividend tax benefits and approximately 40 percent of the capital gain tax  benefits.

Conversely, the same graph depicts how the Earned Income Tax Credit (EITC) benefits the working poor (first quintile) and the Child Tax Credit mainly aids Americans whose share of income places them in the first three quintiles.

Related information:

Babones, Salvatore. "U.S. Income Distribution: Just How Unequal?." 14 February, 2012.

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