Due to COVID-19, the proportion of US households not paying federal income tax surged to '61% last year'

[Image source= Bloomberg]

[Asia Economy Reporter Byunghee Park] Bloomberg News reported on the 18th (local time), citing data from the Urban-Brookings Tax Policy Center, a U.S. think tank, that 61% of American households did not pay federal income tax last year.

This is a significant increase compared to the average of 43.3% over the five years before COVID-19. This is because household incomes dropped sharply last year due to the spread of COVID-19, and the federal government reduced the tax burden through subsidies and other measures.

According to the report released by the Tax Policy Center on the same day, the number of households not paying federal income tax increased from 75.9 million in 2019 to 106.8 million last year. 60.6% of all households did not pay federal income tax.

The Tax Policy Center also predicted that many households would not pay federal income tax this year. It is expected that 57.1% of all households, or 101.7 million households, will not pay federal income tax.

The Tax Policy Center estimated that households with an annual income of $28,000 or less would not pay federal income tax this year. It also estimated that about 75% of households with incomes between $28,000 and $55,000 would not pay federal income tax.

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