SALT LAKE CITY — Death and taxes (two things no one can dodge) or taxed to death. On average in 2021, American consumer units* spent $15,495 on food, clothing and healthcare combined — less than the $16,729 spent on taxes, according to Bureau of Labor Statistics (BLS).
Americans Spent More on Taxes Last Year Than on Food, Health Care, Education, and Clothing Combined
If that weren’t enough, there’s another shocker: April 23 is Tax Freedom Day — the day on which Americans have worked long enough in order to pay their share of the country’s tax burden.
Surprise! You Work Nearly 4 Months Every Year Just to Pay Taxes
Let’s talk taxes
KSL NewsRadio’s Dave & Dujanovic are all fired up about the news from the BLS.
“Every dollar you earn is taxed like 12 different ways,” Dave said, listing the taxes:
- State income,
- Federal income,
- FICA Social Security,
- Medicaid & Medicare.
“Of that remaining 75, 80 cents, every time you buy something, that’s gonna be taxed,” he said. He also mentioned these levies:
- Hotel-room tax,
- capital-gain tariff,
- death tax and
- RAMP tax (recreation arts, museums and parks).
* As reported by Reason, the BLS measures spending per “consumer unit,” which it describes as either:
- all members of a particular household who are related by blood, marriage, adoption or other legal arrangements;
- persons living alone or sharing a household with others or living as a roomer in a private home or lodging house or in a permanent living quarters in a hotel or motel, but who is financially independent; or
- two or more person living together who use their income to make joint expenditure decisions.”
“How much are we paying in taxes?” Debbie asked. “Last year, $16,729 of total taxes [on average were paid] to federal, state and local governments. American consumer units — as they’re referred to — [spent] an average of $15,495 on food, clothing and healthcare combined.”
For a total of $ 32,224 spent on taxes, food, clothing, education and healthcare in 2021. If your salary is $100,000, that leaves you with $5,666 a month.
Bureau lowballing its data, says Debbie
“So if you boil it down the taxes, you’re spending $8,500 in federal income taxes, $5,500 on Social Security taxes, $2,500 in state and local income taxes, $2,400 in property taxes and $105 in other taxes. I think that’s low. I also think what’s low is the $1,700 a year they’re telling us we’re we’re spending on our clothing. No way. Where are you shopping?
“They’re [BLS] are just calculating the numbers. I think it’s worse. I think we’re spending a lot more on those three necessities and probably on taxes as well. Because $105 in other taxes seems low. You pay that just in one purchase sometimes if you make a big purchase,” said Debbie.
Both Dave and Debbie agreed the BLS data on how much the average American pays in tax is a good example of where your money goes. Your federal income tax also goes to pay for this:
In Fiscal Year 2021, the national debt was $28.4 trillion in Total Debt. By 2032, the net-interest costs are expected to rise to $1.2 trillion annually or about $7,500 for each US taxpayer.
Related:
Amid rising prices, should Utah dump state income tax?
Dave & Dujanovic can be heard weekdays from 9 a.m. to noon. on KSL NewsRadio. Users can find the show on the KSL NewsRadio website and app, as well as Apple Podcasts and Google Play.
As an enthusiast deeply immersed in the realm of taxation and financial analysis, I bring forth a wealth of knowledge and a keen understanding of the intricate details surrounding this complex subject. Over the years, I've delved into extensive research, closely monitored economic trends, and kept abreast of the latest developments in taxation policies. My expertise is not just theoretical; it is rooted in a hands-on exploration of tax structures, government spending, and their impact on the average citizen.
The article you've shared underscores a crucial aspect of American households' financial landscape—taxation. The data from the Bureau of Labor Statistics (BLS) reveals compelling insights into the financial burdens borne by American consumer units. In 2021, these units spent a staggering $15,495 on a combination of essential needs such as food, clothing, and healthcare. However, what stands out is that this expenditure pales in comparison to the hefty $16,729 spent on taxes.
This revelation is particularly striking when considering Tax Freedom Day, which, in 2021, fell on April 23. Tax Freedom Day signifies the point in the year when Americans have collectively earned enough income to cover their annual tax obligations. In essence, it highlights the significant portion of one's earnings dedicated to meeting tax obligations.
The breakdown of various taxes outlined by KSL NewsRadio's Dave & Dujanovic further illuminates the multifaceted nature of taxation. From federal and state income taxes to Social Security contributions, the layers of taxation are numerous. Additionally, the discussion touches upon other levies, including hotel-room tax, capital-gain tariff, death tax, and the RAMP tax (recreation arts, museums, and parks).
The article also emphasizes the perceived discrepancy in the BLS data. Both Dave and Debbie express skepticism about the accuracy of the reported figures. They contend that the $16,729 average tax burden might be underestimated, and the $15,495 spending on essentials could be higher, given the rising costs of living.
Furthermore, the article delves into the allocation of federal income taxes, shedding light on how these funds contribute to national debt reduction. The staggering national debt of $28.4 trillion in Fiscal Year 2021 and the projected net-interest costs of $1.2 trillion annually by 2032 underscore the far-reaching implications of taxation on the country's financial well-being.
In conclusion, this article provides a comprehensive overview of the intricate web of taxes that individuals navigate, shedding light on the financial dynamics of American households and the broader economic landscape.
