Having completed a thorough analysis of the impact of Bernie Sanders’s tax plans on incomes for individuals and families across the income spectrum, I was curious to see why the numbers in this article by Dylan Matthews in Vox were so different. Reviewing his analysis, I found that there were some analytical decisions we differed on, a few tax policies that Mr. Matthews omitted or implemented inaccurately, and some significant errors in his math. The result is that Matthews’s exaggerated all of the rates in Bernie’s plans. Even if we grant his decision to pool employee and employer taxes together, which I contend is misleading for a general audience, it turns out that his infamous 77% figure for the top bracket exceeds the real rate by nearly 10 points.
The figure above includes an accurate representation of total effective rates with taxes and average family healthcare costs included. As in Matthews’s analysis, I have pooled both the employee and employer contributions. While this gives a complete picture of the impacts of Bernie’s plans in comparison with current rates,the rates can be misleading if you’re curious what these plans mean to you. Some portions of the costs shown are paid out of an employee’s paycheck, but other portions are paid by employers behind the scenes. Additionally, the net differences (savings and increases) include the pooled amounts saved or paid by both employers and employees. If you’re looking for figures that relate more directly to what you could expect to save or pay, take a look at my previous post on Bernie Sanders’s tax plans. Otherwise, continue reading below for the details of where Mr. Matthews went wrong in his analysis.