The Congressional Budget Office has released a report showing that we paid more in taxes this year than in any other year. Federal taxes collected in fiscal 2022, which ended Sept. 30, reached an all-time high of $4.9 trillion, an increase of $850 billion, or 21%, over last year.
As a share of GDP, federal taxes are at 19.8%, one of the highest levels ever, and 15% higher than the 50-year average of 17.3%. Individual tax receipts increased by nearly $600 billion over last year, a 29% increase. As a share of GDP, individual taxes are at 10.7%, the highest annual level ever reached since the income tax began in 1913. This level of individual taxes is 33% higher than the 50-year average of 8%.
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Similarly, corporate tax revenues totaled $425 billion, the highest level in U.S. history, and more than double the amount collected in 2020. Corporate taxes as a share of GDP are at 1.7%, higher than the 40-year average of 1.6%. The $425 billion paid by businesses shows that there is no “shortfall” in corporate revenues, as Treasury officials keep asserting. In fact, corporate tax revenues are now $128 billion, or 43%, higher than they were before the passage of the 2017 tax cut.
Of course, federal taxes are also surging due to inflation. As the CBO notes, the tax system is only partially indexed for inflation, and a larger share of income is taxed at higher rates during periods of high inflation. Yet, despite the record-high tax receipts, President Joe Biden and congressional Democrats want to raise taxes. Biden’s budget calls for $2.5 trillion in new tax increases, including higher tax rates on people and businesses.
Enough is enough. This CBO report shows that Washington does not need more revenue. And with food, gas, and home prices soaring, the last thing the public needs is more taxes.
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Bruce Thompson was a Senate aide, assistant secretary of Treasury for legislative affairs, and the director of government relations for Merrill Lynch for 22 years.
