July 7, 2026
Taxes are one thing that many of us think about, and worry about. We understand that taxation is the primary way of financing government functions at all levels. And that by taxing citizens and businesses governments fund public services, infrastructure, and operations. The primary kinds of taxation are income taxes, sales taxes, and property taxes.
Under the best of circumstances, governments will work to keep their financial needs as low as possible, while providing essential services, and little else. It’s no secret that such a scenario is not common in our country, although some states are moving in that direction.
Taxation is a broad topic with an array of features that generate interest. One of those is the sorts of tax systems we have here in the United States.
One system for taxing earnings is progressive taxation, which is quite common. The term “progressive” means to move forward toward some target or goal — except in the case of political “progressives,” which is a faction with the goal of moving the country backward.
In taxation, a progressive tax is one that has higher rates as you go up the ladder of earnings. The more you make, the higher the rate of tax you are charged.
For example, in the U.S. the lowest 50 percent of taxpayers paid a rate of 4 percent. Moving up the earnings ladder, those in the 50 - 25 percent range paid 8 percent. Those in the 25 - 10 percent range paid 10 percent; the 10 - 5 percent range paid 14 percent; the 5 - 1 percent range paid 18 percent, and the top 1 percent of earners paid 26 percent.
The theory behind this is that the more money you make, the better able you are to pay more, while those at the lower levels cannot afford high taxes, and in the case of the lowest earners, any taxes. And while those with more money will pay more taxes under a progressive system, they would also pay more under a flat tax, where everyone pays the same rate.
The tax system in the U.S. has been rated number 1: the most progressive tax system among the 33 developed countries. This, incidentally, is not a feather in our cap.
The political Left keeps shouting “tax the rich.” Well, just how much tax revenue does each group pay? In 2023, the top 1 percent of earners paid 38.4 percent of total tax revenue; the top 5 percent paid 59.3 percent of revenue; the top 10 percent paid 70.5 percent of revenue; and the bottom 50 percent paid only 3.3 percent of tax revenue.
And, half of all taxpayers actually paid 97 percent of all federal income taxes.
Will it matter at all to the progressive Left that the highest earning 1 percent paid well more than a third of all tax revenue? Or, that the top 5 percent paid well more than half of it? Do those figures justify the idea of the rich paying their fair share? Not to the progressive Left.
There are proposals in some states — including Washington, Minnesota, Massachusetts, New York and California — to impose a wealth tax on the rich folks in addition to their regular tax rate. And there is the possibility of an increase in the amount the wealthy will have to pay for their Medicare and Social Security.
Massachusetts has imposed a 4 percent surtax on income over $1 million, and Washington is considering a 10 percent surtax on the same amount. California is considering a one-time tax of 5 percent on wealth above $1billion. Then there is the question of whether California will stick with just one time.
What these states may not realize is that it is not difficult for wealthy residents and businesses to pack up and move to a red state, if existing taxes, increases in taxes, or a bad business climate make life difficult for them. And some businesses have done this.
California, New York, Illinois, Massachusetts and New Jersey lead the nation in how many businesses have moved out. And Texas, Florida, North Carolina, Tennessee and Arizona are very happy to have accepted these companies and the jobs they brought to their states.
Governments ought to be thinking about how to keep taxes down for everyone. But they are more concerned with expanding their operations, often for things they should not do, and of course, taxes are how to finance those things.
They also apparently do not understand the benefits of what the wealthy would do with the money they could keep if tax rates were lower. They support local and other businesses when they buy houses, cars, clothes, furniture and other things. They invest in businesses. They support charitable organizations at levels that exceed the amount they can claim as deductions on their tax return.
In its 250-year history, the U.S. government has moved well beyond the limits our brilliant Founders set for it. Those limits include what the government ought to do, and how much control it exerts over the people.
We should all hope that the efforts to eliminate some of the excesses is successful, and that we do move back to that original format.