Happy Tax Freedom Day! And if you’re thinking it feels early this year, you’re right…
In 2009, Tax Freedom Day in the US arrives on April 13, the earliest it’s appeared since 1967, according to the Tax Foundation. That’s more than a week earlier than last year and two weeks earlier than in 2007.
Tax Day marks the day that taxpayers have earned enough money to pay their taxes for the year. The idea was conceived in 1948 by Florida businessman Dallas Hostetler. Hostetler eventually transferred the trademarked day to the Tax Foundation, which has calculated Tax Freedom Day for various nations and the states ever since.
Why so early for the US this year? The recession and the stimulus package have combined to reduce the overall tax burden faster in 2009 (a trend that may continue through 2010). See?! A silver lining!
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Tax Freedom Day
Today is Tax Freedom Day in the US – and unfortunately, it’s not as enticing as it sounds. Tax Freedom Day is the first day of the year when the country has earned enough to pay its taxes.
The idea of Tax Freedom Day was developed in the US by a businessman named Dallas Hostetler. Hostetler later sold the copyright to the Tax Foundation.
So what does the Tax Foundation say about 2008? This year, Americans will work 74 days to afford their federal taxes and 39 more days to pay state and local taxes.
To buy food, Americans will work 35 days – 15 more days than is necessary to pay for health and medicare care (ouch!). Also shocking is that Americans must now work almost half as many days (29 days) to pay for transportation as to pay for housing (60 days).
On the plus side, Tax Freedom Day fell 3 days earlier this year than last (although it was also a leap year).
(Image source: Tax Foundation)
Today is Tax Freedom Day in Israel. Tax Freedom Day marks the day of the year that a country, as a whole, has theoretically earned enough income to meet its tax burden.
In the US this year, Tax Freedom Day fell on April 30, two days later than in 2006. India celebrated earliest this year, on March 14. Israel is next to last on the list. Who suffers more than the Israelis? The Swedes. Sweden’s Tax Freedom Day doesn’t hit until August 8.
Of course, this is a little tongue in cheek. Not all countries collect taxes on the same timeline, so the disparity in Tax Freedom Days doesn’t really mean that the tax burden of a country at the end of the calendar is more than those at the front of the line (though it does make for interesting reading). But in Sweden’s case, it’s fairly accurate. The tax burden in Sweden is equivalent to 51% of GDP, which together with Denmark is the highest in the world.
