Americans pay more in taxes than they do on food and health care

According to the Bureau of Labor Statistics (BLS), in 2021 each consumer unit (families, couples or single individuals) paid an average of $16,729.73 in federal, state and local taxes and $15,495.28 on food, clothing and healthcare. In other words, they spent $1,234.45 more on average on taxation at all levels, than on their personal expenses.

Money spent by Americans on personal expenses rose by $1,567.54 ($13,927.74 in 2020). This increase is linked to the rise in inflation. Rising prices meant that each consumer unit spent more money on food, clothing and healthcare.

If in 2020, $7,316.47 was spent on food, the following year each consumption unit spent $8,289.28. In addition to this, more money was also spent on clothing ($1,754.39 in 2021, up from $1,434.26 in 2020) and health ($5,451.61 in 2021, up from $5,177.01 in 2020).

Food expenses account for 12.4% of expenditures. Clothing accounts for 2.6%, and healthcare spending for 8.1%. In other words, these three categories account for 23.1% of average household expenditures.

Tax expenditure

Federal income taxes had a slight decrease between 2020 and 2021. If $8,561.46 was spent on this levy last year, in 2020 each consumer unit paid $8,811.78 in federal income taxes. In contrast, state or local income taxes increased by $134.43 ($2,564.14 in 2021 from $2,429.71 in 2020).

On the other hand, Social Security and property taxes also went up in 2021. A consumer unit shelled out $173.10 more in Social Security fees in 2021 ($5,565.45 to $5,392.35 in 2020). Property tax payments also increased, by $121.76 ($2,475.18 in 2021 for $2,353.42 in 2020). Regarding other taxes, each family unit spent $105.21 in 2021, up from $71.87 in 2020.