Tax Freedom Day Marks the End of Uncle Sam’s Cut
WASHINGTON — Tax Freedom Day for 1989 arrived today, which means starting Friday an average American worker can keep all earnings made during the rest of this year free of federal, state and local government taxes.
Tax Foundation, a nonprofit, nonpartisan research organization, said it took the average American worker 124 days--from Jan. 1 to May 4--to satisfy this year’s tax obligations, assuming every dollar in the paycheck was allocated for the various taxes.
The good news is that the 124-day tax bite period has remained unchanged in the last three years.
By comparison, in 1950 it took the average worker only until April 3, or 93 days, to satisfy the tax obligations. Since then the tax-bite period has grown steadily.
Stated differently, the foundation said taxes will take a 2-hour, 43-minute bite from the worker’s eight-hour earnings in 1989.
The foundation report said the total tax bite from the workday is far ahead of the next most costly item, housing and household operations, which will take away 1 hour and 25 minutes of the wages.
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