The revelation may catch you off guard.
In countless discussions surrounding tax cuts—whether it’s the most recent ones or those from years past—a common refrain is that the wealthiest individuals benefited the most. Unsurprisingly, this is true; they contribute a significant share of the nation’s overall federal tax revenue. Therefore, it follows that they would also receive the largest tax cuts in sheer dollar amounts.
However, that doesn’t imply that the wealthiest enjoyed the highest percentage reductions in their tax bills. Herein lies a critical point that has largely escaped the purview of many journalists.
In a rather unexpected twist, reporters from the Wall Street Journal recently highlighted that the lowest income quintile actually experienced the most substantial percentage decrease in taxes. Why is this surprising? One might assume that the Wall Street Journal would readily acknowledge such facts, particularly in its editorial sections. However, the news sections have traditionally maintained a different stance. Having read the Journal multiple times a week for over five decades, I’ve noticed the distinct divide between its conservative, occasionally libertarian editorial page and its more left-leaning news reports. In fact, economist Tim Groseclose, in his 2011 work, Left Turn: How Liberal Media Bias Distorts the American Mind, argued that reporters at the Journal rank among the most liberal in major media outlets, a claim I explored in my review of his book here.
Here are the findings shared by WSJ journalists Richard Rubin and Karen Dapena in their July 28 article:
The projected average change in federal taxes owed in 2026, resulting from the new tax legislation, is as follows:
-15.1% for the lowest quintile
-14.9% for the second quintile
-12.6% for the middle quintile
-11.1% for the fourth quintile
-9.2% for the 80-90 percentile
-9.5% for the 90-95 percentile
-11.2% for the 95-99 percentile
-7.1% for the top 1%.
