Tax Cuts For The Rich? Where's The Tax Increase?
Tuesday, House Ways and Means Democrats presented Jackie Calmes of The New York Times with tables from the Joint Committee on Taxation showing the average income tax cuts of extending the Bush tax cuts for those under $250,000. Taxpayers in all income groups would receive large tax cuts, even those with incomes over $1 m. Here's her article from yesterday. Where's the tax increase on those over $250,000? That's the magic of averages. Extending all of the Bush tax cuts would cost approximately $3.8 tr. over the next 10 years, and about $700 b. of that would be lopped off from those over $250,000 under President Obama's proposal. However, the remaining $3.2 tr. of tax cuts (rounding error), mostly the 10% bottom bracket, the $1,000 child credit, and the marriage penalty relief, benefit all taxpayers regardless of income. Those offset the increased top rate to 39.6% and other tax increases on many, but not all, of those over $250,000. Ways and Means did not release tables showing the breakout of the change in federal tax liability between those with a net tax cut and those with a net tax increase. That would show the increase. Also be aware that the attached tables show only the calendar 2011 change in liability, $202.3 b. for the President's proposal and $238.9 b. for extending all of the Bush tax cuts, not the 10-year $3.8 tr. and $3.2 tr. change in receipts.
You've been duped
Your analysis is dead wrong. Upper income people only appear to be getting a "tax cut" because the proposal is being compared to a baseline of current law, meaning ALL of the tax cuts expire. There's no "offset" between tax cuts and tax increases as you claim, and there's no magic of averages. These tables simply compare "let all of the tax cuts expire" with "let some of the tax cuts expire". And "let some expire" will result in "lower" taxes for everyone compared with letting them all expire. But for upper income people they will result in higher taxes -- much higher taxes -- than they have been paying for the last 10 years.
There are no tables showing how many people had a net tax increase, because under this construct NO ONE can possibly have a net tax increase -- not unless the Democrats are proposing to raise taxes ABOVE where they were in 2000. Unfortunately, the New York Times and other major media outlets have allowed themselves to be used by the Ways and Means Democrats to propagate this fiction that some upper income will be better off than they are now because there's some sort of fictitious "offsetting" going on.
@GAC: Wow, I'm amazed you can
@GAC: Wow, I'm amazed you can even *see* the computer screen with your nose up the RW's butt-crack that far. Why exactly is an analysis that compares REALITY with a possible future scenario somehow "wrong", unless the idea always was to force the tax cuts to be permanent without the Republicans having to own up to how much they would cost?
Where is the Tax Increase?
It has already been enacted: The health care bill adds a 0.9 percent increase on earned income for couples earning more than $250,000 and 3.8 percent on unearned income with those with AGI over $250,000. The latter was already a breach of the campaign promise because it relates to AGI not TI and of course these were cleverly labelled Medicare taxes rather than income taxes even though any sentient being knows that is not the reality. The administration has learned that with respect to both taxing and spending increases, it is better strategy to break them up into separable bits in order not to draw too much attention.
We cannot afford a massive tax cut
All of the Bush tax cuts should be allowed to expire. Anything else is a tax cut at a time of horrifying deficits. It should be clear that we will not be able to fix our problems without some pain for those under the top 5% of income. Cutting taxes now would be worse than Bush's original tax cut.