Inflation is Expected to Eat Away Americans’ Tax Refunds by Almost $27 Billion
According to a report by Business Insider, Americans are expected to receive less in tax refunds due to mass inflation. Over 129 million Americans obtained an average tax refund totaling $2,815 for the taxes they paid in 2020.
Due to inflation hiking prices by nearly 10% in the last two years, the same refund check would buy less goods and services in the current year of 2023.
If Americans obtained an average refund of $2,815 in 2023, it would mark a $26.7 billion loss due to inflation. To keep up with mass inflation, Americans must receive an average refund of at least $3,021.
Per tax season data that the IRS publishes weekly, the average refund for the week ending February 3 totaled to just $1,963. In the week ending February 10, that amount climbed slightly upward to $1,997.
With inflation raging and higher interest rates, American families will most certainly be in a pinch. This is the danger of having a fiat money system dominate a country’s political economy for well over a century. Inflation eats away the savings of millions of Americans, while enriching the banker class and other actors that are close to the newly printed economy.
Tackling fiat money is the economic populist issue of our epoch. Any right-wing movement worth its salt will need to push for proposals that rein in the Fed’s power, if not abolish the institution altogether. Anything that falls short is an unserious political project.