Marginal tax rates and potential confusion around them have been in the news a bit lately. I’d never actually seen the effective rate and marginal rate plotted together this way and it worked out well.
I used the single-filer rates, and assumed the only deduction being used is the standard deduction. I also added in a 70% rate for incomes over $10 million since that’s been in the news also. I used matplotlib for the plot.
I have a related plot (take home pay after federal tax vs income) and some more discussion here:
Edit: Linear Scale
Scanning through the comments, a number of people asked about log scales. If you’re curious what it looks like with a linear scale, here you go:
The total x range is much larger than the range where most of the interesting changes happen (i.e., below $1 million), so a linear scale doesn’t really work here.
Edit 2: More Ticks
Here it is with more tick marks:
I toyed with doing that initially, but:
- I find the rotated values harder to read
- I didn’t know how comfortable people would be with scientific notation to make the labels smaller
It is much easier to see where, say, $50,000 is with the extra ticks though so nice suggestion.