Tax Cuts Help Push Back Tax Freedom Day To Near Forty Year Low

by Mike Godfrey, Tax-News.com, Washington

12 April 2004

‘Tax Freedom Day’ in the United States was celebrated on April 11 in 2004, the earliest for 37 years, largely thanks to the tax cuts enacted under the Bush administration, according to the latest calculations by the Tax Foundation.

Tax Freedom Day is the day when Americans will finally have earned enough money to pay off their total tax bill for the year. Every dollar that’s officially called income by the government is counted, and every payment to the government that is officially considered a tax is counted. It provides ordinary Americans with a useful barometer as to the extent of the tax burden, and takes into account hidden taxes and fees that are not always easily accounted for.

“Federal tax cuts have made the average American tax burden lighter in 2004," noted Tax Foundation President Scott Hodge. "Because the bubble in 1999 and 2000 boosted tax collections to artificially high levels, the drop since then is all the more dramatic. In fact, it is the biggest drop in America's tax burden for at least a century."

This year’s Tax Freedom Day falls three days earlier than in 2003, and a massive 21 days earlier than in 2000 at the height of the stock market boom. However, the Tax Foundation forecasts that this date will begin to drift later in the next few years if many of the temporary tax cuts being pushed to be made permanent are left to expire.

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