The American Enterprise Institute’s Tax Satisfaction Analysis Reveals a Call for Change
Americans are unhappy with the current tax system. According to a Pew Research Center poll conducted in February 2015, 59 percent of survey respondents said that “there is so much wrong with the federal tax system that Congress should completely change it.” Twenty-seven percent of respondents are significantly bothered by what they pay in taxes, and another 44 percent stated concern regarding the tax system’s complexity. A significant majority, 64 and 61 percent, respectively, believe that corporations and wealthy individuals are not paying their fair share.
As stated in an analysis by the American Enterprise Institute (AEI), most Americans’ greatest concern when it comes to taxes is the perceived difference between what different income brackets pay and what the public believes they should pay.
The Public’s Dissatisfaction With Taxes
The average American considers tax reform to be a high priority: AEI referenced a Pew Research poll from January that ranks federal tax reform 16th out of the 24 priorities respondents want Washington to address. When respondents to a January 2015 Gallup poll were asked how they feel about the amount Americans pay in federal taxes, 63 percent indicated dissatisfaction, with 46 percent stating that Americans pay too much.
About half of the respondents (49 percent) to an April 2014 Gallup poll the AEI report highlighted believe that the tax burden falls too heavily on the middle class, and 41 percent believe that lower-income Americans pay too much in federal taxes. In comparison, 55 percent say that corporations do not pay their fair share. While graduated taxes are not the answer, this shines a light on the huge disconnect between tax policy and Americans’ priorities.
A Call for Change
The American Enterprise Institute analysis reveals a lack of confidence in the government’s ability to come up with solutions to better manage the nation’s taxes. Disapproval of how President Obama has handled tax policy rose 19 points to 52 percent from April 2009 to December 2014, according to the February Pew Research poll. There was no clear consensus on whether the Republican or Democratic Party would do a better job managing tax policy, with the Republicans barely edging out the Democrats 33 percent to 29 percent. The remaining 38 percent of respondents felt that both parties would fare the same or that neither party would do a good job. The February poll reveals a sharper divide in those numbers: 47 percent in favor of Republicans and 36 percent in favor of Democrats, leaving 17 percent who believe either both or neither group would handle taxation better.
AEI highlighted a November 2014 Gallup poll revealing that 56 percent of Americans believe the IRS is only doing a fair or poor job. That’s a drop from 71 percent in May 2013, but still a significant majority who want to see changes to the tax system.
While tax reform continues to be a priority in Washington, especially now that the 2016 election season is getting started, it remains to be seen how soon the government will take action on Americans’ desire for tax-system change.