Tax burden

Proportion of income paid in taxes at different income levels Chart comparing effective total (federal and state and local) tax rates in the United States, of the richest Americans and those in the bottom 50% of earners The tax burden is the level of effective taxation represented as the distribution of tax rates across people, households, sectors, or forms of income by the amount of their income. Tax burdens are commonly summarized as the tax revenue as a share of gross domestic product for different groups; usually as the effective tax rates paid by different income groups as a share of their income or consumption, or taxes on labor measured as a tax wedge. The tax burden is related to but distinct from tax incidence. Incidence analysis examines how a tax may be shifted through prices and factor returns, while tax burden typically refers to the taxes paid by different income groups. The distribution of the tax burden is an important topic in public finance and is frequently discussed in relation to economic inequality, wealth redistribution, and fiscal policy. Definitions and measurement Because tax systems include many taxes and exemptions, and because studies may define "income