2023 Federal Tax Brackets Are Out. See Which Bracket You Fall in—and Why Tax Rates Are so High

The sad truth is, the average American works four months a year just to cover tax bills. How did we get here?


The Internal Revenue Service released new federal income tax brackets last week. Though marginal tax rates did not change, under federal law the brackets are adjusted for inflation, and they shake out like this.

Marginal rate Individual income Married couples filing jointly
10% $11,000 or less $22,000 or less
12% $11,000 to $44,725 $22,001 to $89,450
22% $44,726 to $95,375 $89,451 to $190,750
24% $95,376 to $182,100 $190,751 to $364,200
32% $182,101 to $231,250 $364,201 to $462,500
35% $231,251 to $578,125 $462,501 to $693,750
37% $578,126 or more $693,751 or more

The adjustments are designed to avoid “bracket creep”—a merciful measure that came out of the Reagan administration—and some media celebrated that many Americans may see a slightly lower tax bill as a result.

“The new brackets for 2023 mean paychecks for many Americans could see a boost, which will help consumers who are being hit hard by inflation and aren’t seeing raises that keep pace with price increases,” Herb Scribner reported in Axios.

While it’s nice to see Axios recognize that a lower tax bill is actually a good thing, the elephant in the room went unnoticed. The tax rates are eye-popping. Why are working families shelling out so much of their money— a fifth of their income, a quarter of their income, a third of their income or more—to the government? The sad truth is, the average American works four months a year just to cover their tax bills.

This invites a few important questions. Who authorized the pillaging of our paychecks and what exactly are we getting in return? And why do we pay taxes in the first place?

Most Americans probably don’t ask themselves these questions. The truth is, most of us pay taxes not because we want to, but because we’ll go to prison if we don’t. (And because our wages are garnished, which is another story.) Some will say they pay taxes because it’s their civic duty, but a funny thing happens when you ask these same people to pay more than they have to. They don’t.

Others will argue taxes are necessary to fund all the programs and departments of the federal government, and they’ll have a point. The Pentagon’s budget is $767 billion alone. The Department of Treasury is not far behind with a $704 billion budget, and the Department of Transportation’s is $128 billion. The Department of Agriculture has a $208 billion budget. It goes on and on. Indeed, the list is so long that few Amerians could name all the federal departments and agencies, and even fewer could explain what these agencies actually do.

This invites an important question: what is the purpose of government?

Again, it’s probably a question few people ask, and answers will vary because it’s a subjective question. The question is easy to answer, however, if we look back to John Locke (1632-1704). In the eyes of Locke, whose ideas influenced the founding fathers and underpin the American system, the role of government is clear: it exists to protect life, liberty, and private property.

“…every Man has a Property in his own Person. This no Body has any Right to but himself. The Labour of his Body, and the Work of his Hands, we may say, are properly his,” wrote Locke in his Second Treatise on Civil Government. “The great and chief end therefore, of Mens uniting into Commonwealths, and putting themselves under Government, is the Preservation of their Property.”

Locke argued the purpose of government is to secure the individual rights of people and nothing else. Its purpose is not to redistribute wealth, provide services to the people, or educate children. Government should be limited to its sole purpose, which is why the framers of the Constitution enumerated specific powers to the federal government spelling out exactly what it was permitted to do and stating in the Bill of Rights everything the federal government could not do to citizens.

When one looks at what the Constitution authorizes the federal government to do and compares it to the alphabet soup of federal agencies, it’s clear that both the Constitution and the principle of limited government have been largely abandoned.

In the absence of these restraining mechanisms, the size, scope, and expense of government have exploded. The federal government is now $31.2 trillion in debt. The institution created to protect our rights has become the greatest violator of our rights, an irony that would not have surprised the French economist Frédéric Bastiat.

“Instead of checking crime, the law itself [becomes] guilty of the evils it is supposed to punish!” Bastiat wrote in The Law.

All of this explains why those marginal tax rates are so high. It stems directly from the size of government.

Instead of being excited that the inflation eating away their wealth might have a small silver lining—a slightly lower tax bill than last year—Americans should be asking why they’re paying so much in the first place. It might help them rediscover the lost principle of limited government.

This article was adapted from an issue of the FEE Daily email newsletter. Click here to sign up and get free-market news and analysis like this in your inbox every weekday.

AUTHOR

Jon Miltimore

Jonathan Miltimore is the Managing Editor of FEE.org. His writing/reporting has been the subject of articles in TIME magazine, The Wall Street Journal, CNN, Forbes, Fox News, and the Star Tribune. Bylines: Newsweek, The Washington Times, MSN.com, The Washington Examiner, The Daily Caller, The Federalist, the Epoch Times.

EDITORS NOTE: This FEE column is republished with permission. ©All rights reserved.

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