12-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Click on PDF or Excel link above for additional tables containing more detail and breakdowns by filing status and demographic groups.
Table T09-0261
Replace ESI Exclusion and Self-Employment Health Insurance Deduction With Voucher to Purchase Private Insurance
Impose Comprehensive VAT at Tax Exclusive Rate of 8.4% With $500 Individual Cash Subsidy
Distribution of Federal Tax Change by Cash Income Percentile, 2009 1
Summary Table
Percent of Tax Units 4
Cash Income Percentile
2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average
Federal Tax
Change ($)
Average Federal Tax Rate 6
Change (%
Points)
Under the
Proposal
90.5
71.2
56.0
45.2
19.6
60.7
9.5
28.8
44.0
54.8
80.4
39.2
27.8
8.1
2.5
-0.1
-5.4
0.0
-8,032.1
-4,863.0
-2,310.2
133.0
15,400.8
100.0
-3,106
-2,087
-1,099
74
9,801
10
-27.9
-7.4
-2.2
0.1
4.2
0.0
-28.1
0.5
12.3
17.3
26.7
18.0
28.3
14.5
7.4
5.2
2.5
71.7
85.6
92.6
94.8
97.5
-2.9
-4.3
-6.7
-7.4
-7.4
2,265.2
2,270.6
4,841.2
6,023.7
2,483.1
2,847
5,950
15,403
75,488
309,804
2.3
3.4
5.2
5.5
5.3
21.6
24.3
27.9
31.5
33.5
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version 0309-2).
Number of AMT Taxpayers (millions). Baseline: 3.8
Proposal: 4.1
(1) Calendar year. Baseline is current law. Proposal replaces the employer sponsored insurance deduction and self-employment health insurance deduction with a
voucher to purchase private insurance. Individual voucher value depends on age and gender; the total voucher for each tax unit is the sum of each individual's voucher.
Only individuals not on public insurance receive a voucher. The proposal imposes a revenue neutral comprehensive VAT at tax exclusive rate of 8.4% to finance the
voucher and $500 individual cash subsidy. The VAT is distributed to labor earnings plus all capital.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax
units. The breaks are (in 2009 dollars): 20% $19,792, 40% $38,213, 60% $65,692, 80% $104,318, 90% $150,433, 95% $203,190, 99% $522,025, 99.9% $2,131,606.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and estate
tax.
(6) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average cash
income.
12-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0261
Replace ESI Exclusion and Self-Employment Health Insurance Deduction With Voucher to Purchase Private Insurance
Impose Comprehensive VAT at Tax Exclusive Rate of 8.4% With $500 Individual Cash Subsidy
Distribution of Federal Tax Change by Cash Income Percentile, 2009 1
Detail Table
4
Percent of Tax Units
2,3
Cash Income Percentile
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Percent
Share of Federal Taxes
Change (%
Points)
6
Average Federal Tax Rate
Under the
Proposal
Change (%
Points)
Under the
Proposal
90.5
71.2
56.0
45.2
19.6
60.7
9.5
28.8
44.0
54.8
80.4
39.2
27.8
8.1
2.5
-0.1
-5.4
0.0
-8,032.1
-4,863.0
-2,310.2
133.0
15,400.8
100.0
-3,106
-2,087
-1,099
74
9,801
10
12,097.6
-93.8
-14.9
0.5
18.6
0.1
-6.2
-3.8
-1.8
0.1
11.9
0.0
-6.3
0.3
10.2
20.0
75.9
100.0
-27.9
-7.4
-2.2
0.1
4.2
0.0
-28.1
0.5
12.3
17.3
26.7
18.0
28.3
14.5
7.4
5.2
2.5
71.7
85.6
92.6
94.8
97.5
-2.9
-4.3
-6.7
-7.4
-7.4
2,265.2
2,270.6
4,841.2
6,023.7
2,483.1
2,847
5,950
15,403
75,488
309,804
12.1
16.4
22.7
21.0
18.8
1.7
1.8
3.7
4.7
1.9
16.3
12.5
20.2
26.9
12.2
2.3
3.4
5.2
5.5
5.3
21.6
24.3
27.9
31.5
33.5
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile, 2009 1
4
Tax Units
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Number
(thousands)
Percent of
Total
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average AfterTax Income5
(Dollars)
Average
Federal Tax
Rate6
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
37,398
33,701
30,402
25,999
22,729
150,979
24.8
22.3
20.1
17.2
15.1
100.0
11,139
28,130
50,928
83,030
234,071
68,631
-26
2,225
7,377
14,288
52,570
12,367
11,165
25,905
43,551
68,742
181,502
56,264
-0.2
7.9
14.5
17.2
22.5
18.0
4.0
9.2
14.9
20.8
51.3
100.0
4.9
10.3
15.6
21.0
48.6
100.0
-0.1
4.0
12.0
19.9
64.0
100.0
11,510
5,519
4,546
1,154
116
7.6
3.7
3.0
0.8
0.1
122,728
173,553
298,384
1,380,494
5,859,810
23,629
36,256
67,728
359,484
1,650,034
99,099
137,298
230,656
1,021,011
4,209,776
19.3
20.9
22.7
26.0
28.2
13.6
9.2
13.1
15.4
6.6
13.4
8.9
12.3
13.9
5.8
14.6
10.7
16.5
22.2
10.2
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version0309-2).
Number of AMT Taxpayers (millions). Baseline: 3.8
Proposal: 4.1
(1) Calendar year. Baseline is current law. Proposal replaces the employer sponsored insurance deduction and self-employment health insurance deduction with a voucher to purchase private insurance. Individual voucher value
depends on age and gender; the total voucher for each tax unit is the sum of each individual's voucher. Only individuals not on public insurance receive a voucher. The proposal imposes a revenue neutral comprehensive VAT at
tax exclusive rate of 6.7% to finance the voucher and $500 individual cash subsidy. The VAT is distributed to labor earnings plus all capital.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The breaks are (in 2009 dollars): 20% $19,792, 40%
$38,213, 60% $65,692, 80% $104,318, 90% $150,433, 95% $203,190, 99% $522,025, 99.9% $2,131,606.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and estate tax.
(6) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average cash income.
12-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0261
Replace ESI Exclusion and Self-Employment Health Insurance Deduction With Voucher to Purchase Private Insurance
Impose Comprehensive VAT at Tax Exclusive Rate of 8.4% With $500 Individual Cash Subsidy
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 2009 1
Detail Table
Percent of Tax Units 4
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Percent
Share of Federal Taxes
Change (%
Points)
Average Federal Tax Rate 6
Under the
Proposal
Change (%
Points)
Under the
Proposal
92.1
79.4
65.1
45.5
18.9
60.7
7.9
20.5
34.8
54.5
81.1
39.2
33.7
10.3
4.3
-0.2
-5.4
0.0
-7,913.2
-5,258.0
-3,466.4
215.2
16,750.8
100.0
-3,715
-2,469
-1,692
107
8,115
10
624.0
-167.1
-28.4
0.9
18.5
0.1
-6.1
-4.1
-2.7
0.2
12.9
0.0
-7.1
-1.6
6.8
19.1
83.0
100.0
-35.6
-9.7
-3.8
0.2
4.2
0.0
-41.3
-3.9
9.5
16.8
26.6
18.0
27.1
13.5
7.8
5.5
2.6
72.8
86.5
92.2
94.5
97.4
-2.9
-4.5
-6.5
-7.3
-7.3
2,576.1
2,667.0
5,198.7
6,309.0
2,585.3
2,468
5,131
12,863
65,409
271,015
12.1
16.7
22.5
21.0
18.7
2.0
2.1
4.0
4.9
2.0
18.5
14.5
21.9
28.2
12.7
2.4
3.5
5.1
5.4
5.3
21.9
24.8
27.5
31.3
33.3
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2009
Tax Units4
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Number
(thousands)
Percent of
Total
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average AfterTax Income5
(Dollars)
Average
Federal Tax
Rate6
1
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
30,811
30,805
29,640
29,116
29,857
150,979
20.4
20.4
19.6
19.3
19.8
100.0
10,429
25,498
45,048
72,752
195,312
68,631
-595
1,478
5,962
12,123
43,800
12,367
11,024
24,020
39,087
60,629
151,512
56,264
-5.7
5.8
13.2
16.7
22.4
18.0
3.1
7.6
12.9
20.4
56.3
100.0
4.0
8.7
13.6
20.8
53.3
100.0
-1.0
2.4
9.5
18.9
70.0
100.0
15,099
7,518
5,846
1,395
138
10.0
5.0
3.9
0.9
0.1
104,284
145,101
254,000
1,205,141
5,155,011
20,372
30,792
57,073
311,845
1,447,331
83,913
114,309
196,927
893,296
3,707,680
19.5
21.2
22.5
25.9
28.1
15.2
10.5
14.3
16.2
6.9
14.9
10.1
13.6
14.7
6.0
16.5
12.4
17.9
23.3
10.7
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version0309-2).
Number of AMT Taxpayers (millions). Baseline: 3.8
Proposal: 4.1
(1) Calendar year. Baseline is current law. Proposal replaces the employer sponsored insurance deduction and self-employment health insurance deduction with a voucher to purchase private insurance. Individual voucher value
depends on age and gender; the total voucher for each tax unit is the sum of each individual's voucher. Only individuals not on public insurance receive a voucher. The proposal imposes a revenue neutral comprehensive VAT at
tax exclusive rate of 6.7% to finance the voucher and $500 individual cash subsidy. The VAT is distributed to labor earnings plus all capital.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by dividing
by the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,452, 40% $24,939, 60% $41,565, 80% $64,974, 90% $90,586, 95% $126,051, 99% $321,606, 99.9%
$1,307,820.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and estate tax.
(6) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average cash income.
12-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0261
Replace ESI Exclusion and Self-Employment Health Insurance Deduction With Voucher to Purchase Private Insurance
Impose Comprehensive VAT at Tax Exclusive Rate of 8.4% With $500 Individual Cash Subsidy
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 2009 1
Detail Table - Single Tax Units
4
Percent of Tax Units
2,3
Cash Income Percentile
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Share of Federal Taxes
Change (%
Points)
Percent
6
Average Federal Tax Rate
Under the
Proposal
Change (%
Points)
Under the
Proposal
91.3
79.2
55.6
34.4
12.8
59.7
8.6
20.7
44.3
65.6
87.1
40.3
31.3
6.9
1.5
-2.6
-5.2
-0.1
-1,685.9
-816.2
-251.8
542.2
2,366.2
100.0
-2,343
-1,225
-425
1,102
5,148
34
-1,193.5
-71.7
-8.7
11.2
17.4
0.4
-7.4
-3.6
-1.2
2.3
10.2
0.0
-6.8
1.4
11.7
23.6
70.2
100.0
-30.5
-6.3
-1.3
2.1
4.0
0.1
-27.9
2.5
13.6
20.8
27.2
18.6
16.5
9.4
7.7
8.4
3.1
83.4
90.6
92.4
91.6
96.9
-4.2
-5.3
-5.7
-6.3
-7.0
615.8
505.3
640.8
604.4
250.5
2,531
4,259
7,864
37,266
170,078
15.6
18.0
20.1
16.7
15.3
2.6
2.2
2.8
2.6
1.1
20.1
14.6
16.9
18.6
8.3
3.3
4.1
4.4
4.6
4.8
24.6
26.7
26.5
31.9
36.0
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2009 1
4
Tax Units
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Number
(thousands)
Percent of
Total
15,928
14,749
13,104
10,889
10,176
65,239
24.4
22.6
20.1
16.7
15.6
100.0
5,386
2,627
1,804
359
33
8.3
4.0
2.8
0.6
0.1
Average
Federal Tax
Burden
(Dollars)
Average AfterTax Income5
(Dollars)
7,691
19,388
32,811
52,452
127,722
41,404
196
1,708
4,896
9,807
29,556
7,673
7,495
17,679
27,914
42,645
98,166
33,731
76,418
104,693
177,218
817,131
3,560,360
16,272
23,672
39,134
223,765
1,111,510
60,147
81,021
138,085
593,365
2,448,850
Average
Income
(Dollars)
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
2.6
8.8
14.9
18.7
23.1
18.5
4.5
10.6
15.9
21.1
48.1
100.0
5.4
11.9
16.6
21.1
45.4
100.0
0.6
5.0
12.8
21.3
60.1
100.0
21.3
22.6
22.1
27.4
31.2
15.2
10.2
11.8
10.9
4.3
14.7
9.7
11.3
9.7
3.6
17.5
12.4
14.1
16.1
7.2
Average
Federal Tax
Rate6
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version0309-2).
(1) Calendar year. Baseline is current law. Proposal replaces the employer sponsored insurance deduction and self-employment health insurance deduction with a voucher to purchase private insurance. Individual voucher value
depends on age and gender; the total voucher for each tax unit is the sum of each individual's voucher. Only individuals not on public insurance receive a voucher. The proposal imposes a revenue neutral comprehensive VAT at
tax exclusive rate of 6.7% to finance the voucher and $500 individual cash subsidy. The VAT is distributed to labor earnings plus all capital.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by divi
by the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,452, 40% $24,939, 60% $41,565, 80% $64,974, 90% $90,586, 95% $126,051, 99% $321,606, 99.9%
$1,307,820.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and estate tax.
(6) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average cash income.
12-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0261
Replace ESI Exclusion and Self-Employment Health Insurance Deduction With Voucher to Purchase Private Insurance
Impose Comprehensive VAT at Tax Exclusive Rate of 8.4% With $500 Individual Cash Subsidy
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 2009 1
Detail Table - Married Tax Units Filing Jointly
4
Percent of Tax Units
2,3
Cash Income Percentile
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Percent
Share of Federal Taxes
Change (%
Points)
6
Average Federal Tax Rate
Under the
Proposal
Change (%
Points)
Under the
Proposal
92.8
82.7
75.7
53.7
21.8
56.8
7.2
17.3
24.2
46.3
78.2
43.2
43.8
13.7
6.2
0.9
-5.4
-1.0
-81.0
-68.3
-66.6
-18.4
337.5
100.0
-6,435
-4,294
-3,174
-647
9,963
890
687.1
-284.6
-46.0
-4.7
19.1
4.3
-3.3
-2.9
-3.0
-1.5
10.8
0.0
-3.8
-1.8
3.2
15.4
87.1
100.0
-46.8
-13.0
-5.4
-0.7
4.2
0.8
-53.6
-8.5
6.4
14.8
26.4
19.6
33.3
15.6
7.7
4.3
2.4
66.7
84.4
92.3
95.6
97.6
-2.5
-4.2
-6.8
-7.5
-7.4
40.3
49.0
110.5
137.7
54.7
2,478
5,693
15,420
74,791
299,092
10.8
16.3
23.4
22.1
19.5
1.0
1.5
3.7
4.6
1.8
17.1
14.5
24.1
31.5
13.8
2.0
3.4
5.3
5.6
5.3
20.7
24.0
27.9
31.1
32.7
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2009 1
4
Tax Units
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average AfterTax Income5
(Dollars)
Number
(thousands)
Percent of
Total
6,690
8,457
11,153
15,150
18,010
59,744
11.2
14.2
18.7
25.4
30.2
100.0
13,760
32,925
58,474
88,068
236,078
110,299
-937
1,509
6,901
13,718
52,297
20,672
14,697
31,417
51,572
74,350
183,780
89,627
8,649
4,572
3,811
979
97
14.5
7.7
6.4
1.6
0.2
122,710
169,474
292,035
1,330,820
5,602,474
22,913
35,026
66,026
339,102
1,534,754
99,797
134,448
226,009
991,717
4,067,720
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
-6.8
4.6
11.8
15.6
22.2
18.7
1.4
4.2
9.9
20.3
64.5
100.0
1.8
5.0
10.7
21.0
61.8
100.0
-0.5
1.0
6.2
16.8
76.3
100.0
18.7
20.7
22.6
25.5
27.4
16.1
11.8
16.9
19.8
8.3
16.1
11.5
16.1
18.1
7.4
16.1
13.0
20.4
26.9
12.1
Average
Federal Tax
Rate6
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version0309-2).
(1) Calendar year. Baseline is current law. Proposal replaces the employer sponsored insurance deduction and self-employment health insurance deduction with a voucher to purchase private insurance. Individual voucher value
depends on age and gender; the total voucher for each tax unit is the sum of each individual's voucher. Only individuals not on public insurance receive a voucher. The proposal imposes a revenue neutral comprehensive VAT at
tax exclusive rate of 6.7% to finance the voucher and $500 individual cash subsidy. The VAT is distributed to labor earnings plus all capital.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by divi
by the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,452, 40% $24,939, 60% $41,565, 80% $64,974, 90% $90,586, 95% $126,051, 99% $321,606, 99.9%
$1,307,820.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and estate tax.
(6) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average cash income.
12-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0261
Replace ESI Exclusion and Self-Employment Health Insurance Deduction With Voucher to Purchase Private Insurance
Impose Comprehensive VAT at Tax Exclusive Rate of 8.4% With $500 Individual Cash Subsidy
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 2009 1
Detail Table - Head of Household Tax Units
4
Percent of Tax Units
2,3
Cash Income Percentile
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Share of Federal Taxes
Dollars
Percent
Change (%
Points)
6
Average Federal Tax Rate
Under the
Proposal
Change (%
Points)
Under the
Proposal
93.0
75.6
65.4
40.8
19.4
72.9
7.0
24.3
34.6
59.2
80.6
27.1
26.9
9.5
3.5
-1.3
-4.9
6.1
64.9
39.0
13.6
-4.0
-14.0
100.0
-4,076
-2,710
-1,442
777
5,849
-2,113
208.4
-314.1
-21.8
6.1
17.0
-52.4
-89.3
-35.7
21.0
41.7
62.9
0.0
-105.6
-29.2
53.6
75.6
106.0
100.0
-30.9
-9.2
-3.0
1.1
3.8
-5.5
-45.8
-6.3
10.7
18.8
26.3
5.0
24.0
9.9
12.1
7.9
4.8
76.0
90.1
87.9
92.1
95.2
-3.5
-4.9
-5.7
-7.7
-8.8
-4.4
-2.4
-3.1
-4.1
-1.9
2,782
5,132
10,761
63,559
310,667
12.9
16.9
20.4
21.6
22.4
24.4
10.7
12.3
15.5
6.8
42.2
18.1
20.3
25.5
11.1
2.7
3.8
4.4
5.7
6.3
24.0
26.2
26.1
31.9
34.6
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2009 1
4
Tax Units
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Number
(thousands)
Percent of
Total
7,886
7,129
4,664
2,524
1,185
23,435
33.7
30.4
19.9
10.8
5.1
100.0
13,176
29,467
48,386
71,741
153,000
38,440
-1,956
863
6,623
12,710
34,439
4,035
781
229
144
32
3
3.3
1.0
0.6
0.1
0.0
101,698
135,764
243,422
1,118,475
4,909,652
21,578
30,371
52,846
293,737
1,389,447
Average
Federal Tax
Rate6
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
15,132
28,604
41,764
59,030
118,561
34,405
-14.8
2.9
13.7
17.7
22.5
10.5
11.5
23.3
25.1
20.1
20.1
100.0
14.8
25.3
24.2
18.5
17.4
100.0
-16.3
6.5
32.7
33.9
43.2
100.0
80,120
105,393
190,576
824,737
3,520,205
21.2
22.4
21.7
26.3
28.3
8.8
3.5
3.9
4.0
1.6
7.8
3.0
3.4
3.3
1.3
17.8
7.4
8.0
10.0
4.3
Average AfterTax Income5
(Dollars)
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version0309-2).
(1) Calendar year. Baseline is current law. Proposal replaces the employer sponsored insurance deduction and self-employment health insurance deduction with a voucher to purchase private insurance. Individual voucher value
depends on age and gender; the total voucher for each tax unit is the sum of each individual's voucher. Only individuals not on public insurance receive a voucher. The proposal imposes a revenue neutral comprehensive VAT at
tax exclusive rate of 6.7% to finance the voucher and $500 individual cash subsidy. The VAT is distributed to labor earnings plus all capital.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by divi
by the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,452, 40% $24,939, 60% $41,565, 80% $64,974, 90% $90,586, 95% $126,051, 99% $321,606, 99.9%
$1,307,820.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and estate tax.
(6) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average cash income.
12-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0261
Replace ESI Exclusion and Self-Employment Health Insurance Deduction With Voucher to Purchase Private Insurance
Impose Comprehensive VAT at Tax Exclusive Rate of 8.4% With $500 Individual Cash Subsidy
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 2009 1
Detail Table - Tax Units with Children
Percent of Tax Units 4
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Percent
Share of Federal Taxes
Change (%
Points)
Average Federal Tax Rate 6
Under the
Proposal
Change (%
Points)
Under the
Proposal
93.6
76.7
72.0
45.9
14.3
63.7
6.4
23.3
27.9
54.1
85.7
36.3
30.2
10.3
5.1
-0.2
-6.1
0.6
250.3
165.5
129.4
-7.7
-442.2
100.0
-5,022
-3,393
-2,667
175
12,304
-439
202.8
-393.9
-33.3
1.1
19.7
-3.1
-8.0
-5.2
-3.7
0.9
16.1
0.0
-11.8
-3.9
8.2
22.8
84.7
100.0
-35.5
-10.0
-4.4
0.2
4.7
-0.5
-53.1
-7.5
8.8
17.3
28.3
16.8
20.6
10.3
5.3
3.2
1.9
79.4
89.8
94.7
96.8
98.1
-3.7
-5.0
-7.7
-8.1
-7.6
-76.8
-69.0
-138.5
-158.0
-61.6
4,187
7,559
20,447
92,473
367,846
14.5
17.7
23.7
21.2
18.6
2.9
2.6
4.9
5.7
2.3
19.1
14.4
22.8
28.4
12.4
2.9
3.9
5.8
5.8
5.4
23.2
25.7
30.2
33.3
34.2
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2009
Tax Units4
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Number
(thousands)
Percent of
Total
10,679
10,452
10,394
9,395
7,700
48,765
21.9
21.4
21.3
19.3
15.8
100.0
14,136
33,788
60,328
95,703
264,258
83,132
-2,477
861
8,002
16,360
62,529
14,393
3,928
1,955
1,451
366
36
8.1
4.0
3.0
0.8
0.1
142,540
195,504
353,516
1,583,826
6,844,819
28,894
42,658
86,291
435,407
1,973,610
1
Average
Federal Tax
Rate6
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
16,613
32,927
52,326
79,343
201,729
68,738
-17.5
2.6
13.3
17.1
23.7
17.3
3.7
8.7
15.5
22.2
50.2
100.0
5.3
10.3
16.2
22.2
46.3
100.0
-3.8
1.3
11.9
21.9
68.6
100.0
113,646
152,846
267,226
1,148,419
4,871,209
20.3
21.8
24.4
27.5
28.8
13.8
9.4
12.7
14.3
6.1
13.3
8.9
11.6
12.5
5.2
16.2
11.9
17.8
22.7
10.1
Average AfterTax Income5
(Dollars)
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version0309-2).
Note: Tax units with children are those claiming an exemption for children at home or away from home.
(1) Calendar year. Baseline is current law. Proposal replaces the employer sponsored insurance deduction and self-employment health insurance deduction with a voucher to purchase private insurance. Individual voucher value
depends on age and gender; the total voucher for each tax unit is the sum of each individual's voucher. Only individuals not on public insurance receive a voucher. The proposal imposes a revenue neutral comprehensive VAT at
tax exclusive rate of 6.7% to finance the voucher and $500 individual cash subsidy. The VAT is distributed to labor earnings plus all capital.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by dividing
by the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,452, 40% $24,939, 60% $41,565, 80% $64,974, 90% $90,586, 95% $126,051, 99% $321,606, 99.9%
$1,307,820.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and estate tax.
(6) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average cash income.
12-May-09
PRELIMINARY RESULTS
http://www.taxpolicycenter.org
Table T09-0261
Replace ESI Exclusion and Self-Employment Health Insurance Deduction With Voucher to Purchase Private Insurance
Impose Comprehensive VAT at Tax Exclusive Rate of 8.4% With $500 Individual Cash Subsidy
Distribution of Federal Tax Change by Cash Income Percentile Adjusted for Family Size, 2009 1
Detail Table - Elderly Tax Units
Percent of Tax Units 4
Cash Income Percentile2,3
With Tax Cut
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
With Tax
Increase
Percent Change
in After-Tax
Income5
Share of Total
Federal Tax
Change
Average Federal Tax Change
Dollars
Share of Federal Taxes
Change (%
Points)
Percent
Average Federal Tax Rate 6
Under the
Proposal
Change (%
Points)
Under the
Proposal
90.9
85.4
67.6
44.0
20.9
60.1
9.0
14.5
32.3
55.9
79.0
39.8
17.3
3.9
1.6
-0.1
-4.4
-1.7
-26.5
-18.9
-9.4
1.6
153.2
100.0
-1,769
-824
-600
85
6,974
1,062
-10,625.3
-210.1
-46.1
1.4
18.5
10.3
-2.5
-1.9
-1.1
-0.9
6.3
0.0
-2.5
-0.9
1.0
10.4
91.9
100.0
-17.3
-3.9
-1.5
0.1
3.5
1.5
-17.1
-2.0
1.8
8.9
22.6
15.6
29.4
18.7
11.2
4.1
1.3
70.4
81.3
88.8
95.9
98.7
-1.9
-3.0
-5.1
-6.4
-7.0
15.3
18.6
48.9
70.4
30.2
1,531
3,408
9,487
50,743
225,148
12.5
15.9
22.1
19.2
17.8
0.2
0.6
2.4
3.1
1.2
12.9
12.7
25.4
40.9
18.7
1.6
2.6
4.1
4.8
5.0
14.6
18.5
22.8
29.7
33.2
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Baseline Distribution of Income and Federal Taxes
by Cash Income Percentile Adjusted for Family Size, 2009
Tax Units4
Cash Income Percentile2,3
Lowest Quintile
Second Quintile
Middle Quintile
Fourth Quintile
Top Quintile
All
Average
Income
(Dollars)
Average
Federal Tax
Burden
(Dollars)
Average AfterTax Income5
(Dollars)
Number
(thousands)
Percent of
Total
4,518
6,908
4,712
5,606
6,619
28,390
15.9
24.3
16.6
19.8
23.3
100.0
10,241
21,365
39,436
67,390
197,494
72,658
17
392
1,301
5,886
37,681
10,270
10,225
20,973
38,135
61,504
159,814
62,388
3,007
1,640
1,554
418
40
10.6
5.8
5.5
1.5
0.1
95,095
133,885
230,630
1,059,787
4,494,318
12,301
21,417
43,028
263,997
1,265,869
82,795
112,469
187,602
795,790
3,228,449
1
Share of PreTax Income
Percent of
Total
Share of PostTax Income
Percent of
Total
Share of
Federal Taxes
Percent of
Total
0.2
1.8
3.3
8.7
19.1
14.1
2.2
7.2
9.0
18.3
63.4
100.0
2.6
8.2
10.2
19.5
59.7
100.0
0.0
0.9
2.1
11.3
85.5
100.0
12.9
16.0
18.7
24.9
28.2
13.9
10.7
17.4
21.5
8.8
14.1
10.4
16.5
18.8
7.4
12.7
12.1
22.9
37.9
17.6
Average
Federal Tax
Rate6
Addendum
80-90
90-95
95-99
Top 1 Percent
Top 0.1 Percent
Source: Urban-Brookings Tax Policy Center Microsimulation Model (version0309-2).
Note: Elderly tax units are those with either head or spouse (if filing jointly) age 65 or older.
(1) Calendar year. Baseline is current law. Proposal replaces the employer sponsored insurance deduction and self-employment health insurance deduction with a voucher to purchase private insurance. Individual voucher value
depends on age and gender; the total voucher for each tax unit is the sum of each individual's voucher. Only individuals not on public insurance receive a voucher. The proposal imposes a revenue neutral comprehensive VAT at
tax exclusive rate of 6.7% to finance the voucher and $500 individual cash subsidy. The VAT is distributed to labor earnings plus all capital.
(2) Tax units with negative cash income are excluded from the lowest income class but are included in the totals. For a description of cash income, see
http://www.taxpolicycenter.org/TaxModel/income.cfm
(3) The cash income percentile classes used in this table are based on the income distribution for the entire population and contain an equal number of people, not tax units. The incomes used are adjusted for family size by dividing
by the square root of the number of people in the tax unit. The resulting percentile breaks are (in 2009 dollars): 20% $13,452, 40% $24,939, 60% $41,565, 80% $64,974, 90% $90,586, 95% $126,051, 99% $321,606, 99.9%
$1,307,820.
(4) Includes both filing and non-filing units but excludes those that are dependents of other tax units.
(5) After-tax income is cash income less: individual income tax net of refundable credits; corporate income tax; payroll taxes (Social Security and Medicare); and estate tax.
(6) Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, and the estate tax) as a percentage of average cash income.