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Week of 4.11.08

Taxing the Poor

Winner of a 2008 Emmy Award for outstanding analysis of a business news story.

Millions of Americans are filing their taxes and hoping for the best, but are rich people actually paying a smaller percentage of their total income than the poor? This week, NOW looks at how state policies to generate revenue by raising sales taxes and lowering property taxes come at a bigger price for low-income households than for wealthier ones.

Anti-poverty advocates say the shift assigns the heaviest tax burden to those who can least afford it. Despite the charge, it's a model many states have long embraced.

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NOW travels to one of these states, Alabama, to document the personal impact of regressive tax policies on three very different families. They include a working Mom who shows us how a ten percent sales tax on groceries makes a significant difference in what her family eats; a couple living in a ramshackle house in the backwoods who've always held jobs but still face hunger; and a well to-do suburban couple who benefit from tax breaks, but feel they shouldn't "take from the poor to give to the rich."

Until two years ago, Alabama families of four earning as little as $4,600 a year paid state income taxes. In 2006, with strong help from a lobbying group for the poor, the figure was raised to $12,600.

As residents, local politicians, and activists weigh in with their perspectives, NOW asks: Are taxes being levied fairly when it comes to the rich and the poor?

Related Links

GoodJobsFirst: Find out more about corporate tax giveaways

The Tax Foundation: Candidate Tax Plan Comparison

Center on Budget and Policy Priorities: Income Inequality Grew in Most States Over Two Decades

Good Jobs First: The State of State Disclosure: An Evaluation of Online Public Information About Economic Development Subsidies, Procurement Contracts and Lobbying Activities

The Institute on Taxation and Economic Policy

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