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August 30, 2008 at 11:15 AM #263873August 30, 2008 at 2:11 PM #263695
PatentGuy
ParticipantYes. That’s my point. Gates donates wealth to offset any income he may otherwise have. He does not draw much salary (in fact, I’m not sure he draws any at this point), so payroll taxes are not a problem for him, and certainly the bulk of the “tax on the rich” proposed by Obama is the payroll tax increase that only applies to “earned income” (not investment income or capital gains) over $250K. I am all for Gates donating his money. I think it’s terrific, and that he can do a much better job spending it than would the government.
And, yes “Wall Street” makes their money through investment (e.g., hedge fund managers), and also will not be subject to the new payroll taxes. Even Obama is not proposing taxing investment income at ordinary income levels, just raising it to 28% instead of 15%. In fact, I would support Obama but for the payroll tax proposal. And, no doubt he will win. McCain has shown how little he cares about experience with this absurd IMO selection of Palin. Blatant pandering by Obama to class envy more than offset by blatant pandering to Christian right-wingers by McCain. McCain has lost all credibility he may have had in the “experience matters” issue. He is wrinkled, shriveled toast. His only chance to win is the closet racist voters in swing states, who will lie to pollsters about who they are voting for.
Obama is a great role model for young black America, and as one of the earlier posters commented, will probably make a fine president, but for whatever damage his tax policies may achieve. And, as the earlier posters have also pointed out, he cannot raise taxes by himself. It takes both houses to pass the increases. He just signs them.
“Wake up and smell the coffee” – huh? Do you think I am a supporter/defender of the republican party? Except on taxes (sort of – they are still too high) and maybe immigration (I am for open borders for true workers, but we already have an abundant supply of native-born slackers), GW has been one of the worst presidents in a long time, maybe ever, certainly since Jimmy Carter. I am a registered Libertarian (for more than 20 years, now). We have all manner of nut jobs run as candidates, but at least they don’t want in my wallet like the Dems (except for campaign contributions), or in my bedroom or my wife’s uterus like the Republicans.
OK, done ranting. Back to work. There’s still four more months to keep 55 cents of each incremental earned dollar. Plenty of time for slacking starting in January!
August 30, 2008 at 2:11 PM #263904ParticipantYes. That’s my point. Gates donates wealth to offset any income he may otherwise have. He does not draw much salary (in fact, I’m not sure he draws any at this point), so payroll taxes are not a problem for him, and certainly the bulk of the “tax on the rich” proposed by Obama is the payroll tax increase that only applies to “earned income” (not investment income or capital gains) over $250K. I am all for Gates donating his money. I think it’s terrific, and that he can do a much better job spending it than would the government.
And, yes “Wall Street” makes their money through investment (e.g., hedge fund managers), and also will not be subject to the new payroll taxes. Even Obama is not proposing taxing investment income at ordinary income levels, just raising it to 28% instead of 15%. In fact, I would support Obama but for the payroll tax proposal. And, no doubt he will win. McCain has shown how little he cares about experience with this absurd IMO selection of Palin. Blatant pandering by Obama to class envy more than offset by blatant pandering to Christian right-wingers by McCain. McCain has lost all credibility he may have had in the “experience matters” issue. He is wrinkled, shriveled toast. His only chance to win is the closet racist voters in swing states, who will lie to pollsters about who they are voting for.
Obama is a great role model for young black America, and as one of the earlier posters commented, will probably make a fine president, but for whatever damage his tax policies may achieve. And, as the earlier posters have also pointed out, he cannot raise taxes by himself. It takes both houses to pass the increases. He just signs them.
“Wake up and smell the coffee” – huh? Do you think I am a supporter/defender of the republican party? Except on taxes (sort of – they are still too high) and maybe immigration (I am for open borders for true workers, but we already have an abundant supply of native-born slackers), GW has been one of the worst presidents in a long time, maybe ever, certainly since Jimmy Carter. I am a registered Libertarian (for more than 20 years, now). We have all manner of nut jobs run as candidates, but at least they don’t want in my wallet like the Dems (except for campaign contributions), or in my bedroom or my wife’s uterus like the Republicans.
OK, done ranting. Back to work. There’s still four more months to keep 55 cents of each incremental earned dollar. Plenty of time for slacking starting in January!
August 30, 2008 at 2:11 PM #263908ParticipantYes. That’s my point. Gates donates wealth to offset any income he may otherwise have. He does not draw much salary (in fact, I’m not sure he draws any at this point), so payroll taxes are not a problem for him, and certainly the bulk of the “tax on the rich” proposed by Obama is the payroll tax increase that only applies to “earned income” (not investment income or capital gains) over $250K. I am all for Gates donating his money. I think it’s terrific, and that he can do a much better job spending it than would the government.
And, yes “Wall Street” makes their money through investment (e.g., hedge fund managers), and also will not be subject to the new payroll taxes. Even Obama is not proposing taxing investment income at ordinary income levels, just raising it to 28% instead of 15%. In fact, I would support Obama but for the payroll tax proposal. And, no doubt he will win. McCain has shown how little he cares about experience with this absurd IMO selection of Palin. Blatant pandering by Obama to class envy more than offset by blatant pandering to Christian right-wingers by McCain. McCain has lost all credibility he may have had in the “experience matters” issue. He is wrinkled, shriveled toast. His only chance to win is the closet racist voters in swing states, who will lie to pollsters about who they are voting for.
Obama is a great role model for young black America, and as one of the earlier posters commented, will probably make a fine president, but for whatever damage his tax policies may achieve. And, as the earlier posters have also pointed out, he cannot raise taxes by himself. It takes both houses to pass the increases. He just signs them.
“Wake up and smell the coffee” – huh? Do you think I am a supporter/defender of the republican party? Except on taxes (sort of – they are still too high) and maybe immigration (I am for open borders for true workers, but we already have an abundant supply of native-born slackers), GW has been one of the worst presidents in a long time, maybe ever, certainly since Jimmy Carter. I am a registered Libertarian (for more than 20 years, now). We have all manner of nut jobs run as candidates, but at least they don’t want in my wallet like the Dems (except for campaign contributions), or in my bedroom or my wife’s uterus like the Republicans.
OK, done ranting. Back to work. There’s still four more months to keep 55 cents of each incremental earned dollar. Plenty of time for slacking starting in January!
August 30, 2008 at 2:11 PM #263961ParticipantYes. That’s my point. Gates donates wealth to offset any income he may otherwise have. He does not draw much salary (in fact, I’m not sure he draws any at this point), so payroll taxes are not a problem for him, and certainly the bulk of the “tax on the rich” proposed by Obama is the payroll tax increase that only applies to “earned income” (not investment income or capital gains) over $250K. I am all for Gates donating his money. I think it’s terrific, and that he can do a much better job spending it than would the government.
And, yes “Wall Street” makes their money through investment (e.g., hedge fund managers), and also will not be subject to the new payroll taxes. Even Obama is not proposing taxing investment income at ordinary income levels, just raising it to 28% instead of 15%. In fact, I would support Obama but for the payroll tax proposal. And, no doubt he will win. McCain has shown how little he cares about experience with this absurd IMO selection of Palin. Blatant pandering by Obama to class envy more than offset by blatant pandering to Christian right-wingers by McCain. McCain has lost all credibility he may have had in the “experience matters” issue. He is wrinkled, shriveled toast. His only chance to win is the closet racist voters in swing states, who will lie to pollsters about who they are voting for.
Obama is a great role model for young black America, and as one of the earlier posters commented, will probably make a fine president, but for whatever damage his tax policies may achieve. And, as the earlier posters have also pointed out, he cannot raise taxes by himself. It takes both houses to pass the increases. He just signs them.
“Wake up and smell the coffee” – huh? Do you think I am a supporter/defender of the republican party? Except on taxes (sort of – they are still too high) and maybe immigration (I am for open borders for true workers, but we already have an abundant supply of native-born slackers), GW has been one of the worst presidents in a long time, maybe ever, certainly since Jimmy Carter. I am a registered Libertarian (for more than 20 years, now). We have all manner of nut jobs run as candidates, but at least they don’t want in my wallet like the Dems (except for campaign contributions), or in my bedroom or my wife’s uterus like the Republicans.
OK, done ranting. Back to work. There’s still four more months to keep 55 cents of each incremental earned dollar. Plenty of time for slacking starting in January!
August 30, 2008 at 2:11 PM #263997ParticipantYes. That’s my point. Gates donates wealth to offset any income he may otherwise have. He does not draw much salary (in fact, I’m not sure he draws any at this point), so payroll taxes are not a problem for him, and certainly the bulk of the “tax on the rich” proposed by Obama is the payroll tax increase that only applies to “earned income” (not investment income or capital gains) over $250K. I am all for Gates donating his money. I think it’s terrific, and that he can do a much better job spending it than would the government.
And, yes “Wall Street” makes their money through investment (e.g., hedge fund managers), and also will not be subject to the new payroll taxes. Even Obama is not proposing taxing investment income at ordinary income levels, just raising it to 28% instead of 15%. In fact, I would support Obama but for the payroll tax proposal. And, no doubt he will win. McCain has shown how little he cares about experience with this absurd IMO selection of Palin. Blatant pandering by Obama to class envy more than offset by blatant pandering to Christian right-wingers by McCain. McCain has lost all credibility he may have had in the “experience matters” issue. He is wrinkled, shriveled toast. His only chance to win is the closet racist voters in swing states, who will lie to pollsters about who they are voting for.
Obama is a great role model for young black America, and as one of the earlier posters commented, will probably make a fine president, but for whatever damage his tax policies may achieve. And, as the earlier posters have also pointed out, he cannot raise taxes by himself. It takes both houses to pass the increases. He just signs them.
“Wake up and smell the coffee” – huh? Do you think I am a supporter/defender of the republican party? Except on taxes (sort of – they are still too high) and maybe immigration (I am for open borders for true workers, but we already have an abundant supply of native-born slackers), GW has been one of the worst presidents in a long time, maybe ever, certainly since Jimmy Carter. I am a registered Libertarian (for more than 20 years, now). We have all manner of nut jobs run as candidates, but at least they don’t want in my wallet like the Dems (except for campaign contributions), or in my bedroom or my wife’s uterus like the Republicans.
OK, done ranting. Back to work. There’s still four more months to keep 55 cents of each incremental earned dollar. Plenty of time for slacking starting in January!
August 30, 2008 at 7:29 PM #263835TheBreeze
Participant[quote=condogrrl]Obama will be our first affirmative action president. The less qualified candidate is promoted to president because of his color. No wonder people don’t want to entrust the country to him. Would you want an affirmative action doctor to operate on you? Would you even want an affirmative action mechanic to work on your car? No, I want a truly qualified person. Obama’s credentials are weaker than mine. And I’m not so arrogant to think that I could run this country successfully.[/quote]
How do you think Bush got into Yale? Based on merit? White dudes have had their own form of affirmative action for a long time. Obama was editor of Harvard Law Review. Bush can’t string 3 coherent words together. I think Obama has earned his place.
August 30, 2008 at 7:29 PM #264043Participant[quote=condogrrl]Obama will be our first affirmative action president. The less qualified candidate is promoted to president because of his color. No wonder people don’t want to entrust the country to him. Would you want an affirmative action doctor to operate on you? Would you even want an affirmative action mechanic to work on your car? No, I want a truly qualified person. Obama’s credentials are weaker than mine. And I’m not so arrogant to think that I could run this country successfully.[/quote]
How do you think Bush got into Yale? Based on merit? White dudes have had their own form of affirmative action for a long time. Obama was editor of Harvard Law Review. Bush can’t string 3 coherent words together. I think Obama has earned his place.
August 30, 2008 at 7:29 PM #264049Participant[quote=condogrrl]Obama will be our first affirmative action president. The less qualified candidate is promoted to president because of his color. No wonder people don’t want to entrust the country to him. Would you want an affirmative action doctor to operate on you? Would you even want an affirmative action mechanic to work on your car? No, I want a truly qualified person. Obama’s credentials are weaker than mine. And I’m not so arrogant to think that I could run this country successfully.[/quote]
How do you think Bush got into Yale? Based on merit? White dudes have had their own form of affirmative action for a long time. Obama was editor of Harvard Law Review. Bush can’t string 3 coherent words together. I think Obama has earned his place.
August 30, 2008 at 7:29 PM #264101Participant[quote=condogrrl]Obama will be our first affirmative action president. The less qualified candidate is promoted to president because of his color. No wonder people don’t want to entrust the country to him. Would you want an affirmative action doctor to operate on you? Would you even want an affirmative action mechanic to work on your car? No, I want a truly qualified person. Obama’s credentials are weaker than mine. And I’m not so arrogant to think that I could run this country successfully.[/quote]
How do you think Bush got into Yale? Based on merit? White dudes have had their own form of affirmative action for a long time. Obama was editor of Harvard Law Review. Bush can’t string 3 coherent words together. I think Obama has earned his place.
August 30, 2008 at 7:29 PM #264137Participant[quote=condogrrl]Obama will be our first affirmative action president. The less qualified candidate is promoted to president because of his color. No wonder people don’t want to entrust the country to him. Would you want an affirmative action doctor to operate on you? Would you even want an affirmative action mechanic to work on your car? No, I want a truly qualified person. Obama’s credentials are weaker than mine. And I’m not so arrogant to think that I could run this country successfully.[/quote]
How do you think Bush got into Yale? Based on merit? White dudes have had their own form of affirmative action for a long time. Obama was editor of Harvard Law Review. Bush can’t string 3 coherent words together. I think Obama has earned his place.
August 31, 2008 at 8:25 AM #263990CoronitaParticipantHave any of you seen this from the from the online WSJ commentary?…..Thoughts?
—–
Barack Obama’s tax plan is the opposite of supply-side economics. He proposes to raise marginal rates for just about every federal tax. He also proposes a raft of tax credits that taxpayers can receive if they engage in various government-specified activities.
Moreover, the tax credits would mostly go to those who pay little or nothing in federal income taxes. His trick is to make the tax credits “refundable.” Thus, if the tax credit is for $1,000, but the taxpayer would otherwise only pay $200 in taxes, the government would write a check to the taxpayer for $800. If the taxpayer pays nothing in federal income taxes, the government would pay him the whole $1,000.
[comment] not only folks don’t pay taxes back, they get a rebate
Such credits are not tax cuts. Indeed, they should be called The New Tax Welfare. In effect, Mr. Obama is proposing to create or expand a slew of government spending programs that are disguised as tax credits. The spending on these programs is then subtracted from the total tax burden, in order to make the claim that his tax plan is a net tax cut overall.
On the tax side of the ledger, the details released by his campaign last week confirm what a President Obama has in mind for our most productive citizens. The top individual income tax rate, for example, would be increased by 13%, to 39.6%; the next-highest rate would be raised to 36%. The top rates on capital gains and dividends would rise by a third, to 20%
The Social Security payroll tax would be raised between 16% to 32% for families making over $250,000 a year. This means that the real returns these people get from their lifetime payments into the retirement program will be driven below 0%.
[comment] So basically some folks paying into a SSN will essentially not see most of it when they retire. That’s not a “savings plan”
Mr. Obama also wants a permanent federal estate tax, with a top rate of 45%; his health-insurance plan includes a new payroll tax on employers; and he also contemplates several increases in the corporate income tax, including a new so-called windfall profits tax on oil companies.
Then there is the spending side of the ledger. Mr. Obama proposes a fully refundable Making Work Pay Tax Credit, which would have the government pay out $500 to each worker and $1,000 to couples — reminiscent of George McGovern’s 1972 election proposal for the government to send a $1,000 check to everyone.
His American Opportunity Tax Credit would provide a $4,000, fully refundable tax credit for college tuition expenses.
[comment]:ok, this isn’t a bad idea imho. Americans needs more education imho
His Mortgage Interest Tax Credit would provide a 10% credit — refundable — to offset mortgage interest payments for lower- and middle-income families.
His Health Care Tax Credits, which the campaign says “will ensure that health insurance is available and affordable for all families,” include “a new refundable 50 percent health tax credit on employee premiums paid by employers.”
Currently existing tax credits would also become spending programs in the Obama tax program. The Savers Credit would be made fully refundable, and would be expanded, according to the campaign, “to match 50% of the first $1,000 of savings for families that earn under $75,000.” The Child and Dependent Care Tax Credit would be made refundable and expanded to allow “low-income families to receive up to a 50 percent credit on the first $6,000 of child care expenses.”
The Earned Income Tax Credit is already refundable. Mr. Obama would expand it to “increase the number of working parents eligible for EITC benefits, increase the benefits available to noncustodial parents who fulfill their child support obligations, increase benefits for families with three or more children, and reduce the EITC marriage penalty, which hurts low-income families.” In short, welfare spending is to be increased by paying more money out to low-income income tax filers.
The latest Congressional Budget Office data shows the bottom 40% of income earners already pays no income taxes. Indeed, they receive a net payment from the federal income tax system — meaning from the taxpayers — equal to 3.8% of all federal income taxes, because of the refundable tax credits under current law. The middle 20% of income earners, the true middle class, pays 4.4% of federal income taxes.
Overall, the bottom 60% of income earners pay less than 1% of federal income taxes on net. When “tax credits” primarily go to this group in the form of checks from the government (rather than a reduction in their tax burden) it is simply an abuse of the language to call the spending a tax cut.
Consequently, to say, as the campaign does say, that the candidate’s tax plan is a tax cut on net — and that it would limit taxes to 18.2% of GDP — is grossly misleading. The Obama tax plan would sharply increase real taxes.
It also would come nowhere near to paying for the massive increases in federal spending he has proposed, including the spending that is disguised in the form of refundable tax credits.
August 31, 2008 at 8:25 AM #264198CoronitaParticipantHave any of you seen this from the from the online WSJ commentary?…..Thoughts?
—–
Barack Obama’s tax plan is the opposite of supply-side economics. He proposes to raise marginal rates for just about every federal tax. He also proposes a raft of tax credits that taxpayers can receive if they engage in various government-specified activities.
Moreover, the tax credits would mostly go to those who pay little or nothing in federal income taxes. His trick is to make the tax credits “refundable.” Thus, if the tax credit is for $1,000, but the taxpayer would otherwise only pay $200 in taxes, the government would write a check to the taxpayer for $800. If the taxpayer pays nothing in federal income taxes, the government would pay him the whole $1,000.
[comment] not only folks don’t pay taxes back, they get a rebate
Such credits are not tax cuts. Indeed, they should be called The New Tax Welfare. In effect, Mr. Obama is proposing to create or expand a slew of government spending programs that are disguised as tax credits. The spending on these programs is then subtracted from the total tax burden, in order to make the claim that his tax plan is a net tax cut overall.
On the tax side of the ledger, the details released by his campaign last week confirm what a President Obama has in mind for our most productive citizens. The top individual income tax rate, for example, would be increased by 13%, to 39.6%; the next-highest rate would be raised to 36%. The top rates on capital gains and dividends would rise by a third, to 20%
The Social Security payroll tax would be raised between 16% to 32% for families making over $250,000 a year. This means that the real returns these people get from their lifetime payments into the retirement program will be driven below 0%.
[comment] So basically some folks paying into a SSN will essentially not see most of it when they retire. That’s not a “savings plan”
Mr. Obama also wants a permanent federal estate tax, with a top rate of 45%; his health-insurance plan includes a new payroll tax on employers; and he also contemplates several increases in the corporate income tax, including a new so-called windfall profits tax on oil companies.
Then there is the spending side of the ledger. Mr. Obama proposes a fully refundable Making Work Pay Tax Credit, which would have the government pay out $500 to each worker and $1,000 to couples — reminiscent of George McGovern’s 1972 election proposal for the government to send a $1,000 check to everyone.
His American Opportunity Tax Credit would provide a $4,000, fully refundable tax credit for college tuition expenses.
[comment]:ok, this isn’t a bad idea imho. Americans needs more education imho
His Mortgage Interest Tax Credit would provide a 10% credit — refundable — to offset mortgage interest payments for lower- and middle-income families.
His Health Care Tax Credits, which the campaign says “will ensure that health insurance is available and affordable for all families,” include “a new refundable 50 percent health tax credit on employee premiums paid by employers.”
Currently existing tax credits would also become spending programs in the Obama tax program. The Savers Credit would be made fully refundable, and would be expanded, according to the campaign, “to match 50% of the first $1,000 of savings for families that earn under $75,000.” The Child and Dependent Care Tax Credit would be made refundable and expanded to allow “low-income families to receive up to a 50 percent credit on the first $6,000 of child care expenses.”
The Earned Income Tax Credit is already refundable. Mr. Obama would expand it to “increase the number of working parents eligible for EITC benefits, increase the benefits available to noncustodial parents who fulfill their child support obligations, increase benefits for families with three or more children, and reduce the EITC marriage penalty, which hurts low-income families.” In short, welfare spending is to be increased by paying more money out to low-income income tax filers.
The latest Congressional Budget Office data shows the bottom 40% of income earners already pays no income taxes. Indeed, they receive a net payment from the federal income tax system — meaning from the taxpayers — equal to 3.8% of all federal income taxes, because of the refundable tax credits under current law. The middle 20% of income earners, the true middle class, pays 4.4% of federal income taxes.
Overall, the bottom 60% of income earners pay less than 1% of federal income taxes on net. When “tax credits” primarily go to this group in the form of checks from the government (rather than a reduction in their tax burden) it is simply an abuse of the language to call the spending a tax cut.
Consequently, to say, as the campaign does say, that the candidate’s tax plan is a tax cut on net — and that it would limit taxes to 18.2% of GDP — is grossly misleading. The Obama tax plan would sharply increase real taxes.
It also would come nowhere near to paying for the massive increases in federal spending he has proposed, including the spending that is disguised in the form of refundable tax credits.
August 31, 2008 at 8:25 AM #264205CoronitaParticipantHave any of you seen this from the from the online WSJ commentary?…..Thoughts?
—–
Barack Obama’s tax plan is the opposite of supply-side economics. He proposes to raise marginal rates for just about every federal tax. He also proposes a raft of tax credits that taxpayers can receive if they engage in various government-specified activities.
Moreover, the tax credits would mostly go to those who pay little or nothing in federal income taxes. His trick is to make the tax credits “refundable.” Thus, if the tax credit is for $1,000, but the taxpayer would otherwise only pay $200 in taxes, the government would write a check to the taxpayer for $800. If the taxpayer pays nothing in federal income taxes, the government would pay him the whole $1,000.
[comment] not only folks don’t pay taxes back, they get a rebate
Such credits are not tax cuts. Indeed, they should be called The New Tax Welfare. In effect, Mr. Obama is proposing to create or expand a slew of government spending programs that are disguised as tax credits. The spending on these programs is then subtracted from the total tax burden, in order to make the claim that his tax plan is a net tax cut overall.
On the tax side of the ledger, the details released by his campaign last week confirm what a President Obama has in mind for our most productive citizens. The top individual income tax rate, for example, would be increased by 13%, to 39.6%; the next-highest rate would be raised to 36%. The top rates on capital gains and dividends would rise by a third, to 20%
The Social Security payroll tax would be raised between 16% to 32% for families making over $250,000 a year. This means that the real returns these people get from their lifetime payments into the retirement program will be driven below 0%.
[comment] So basically some folks paying into a SSN will essentially not see most of it when they retire. That’s not a “savings plan”
Mr. Obama also wants a permanent federal estate tax, with a top rate of 45%; his health-insurance plan includes a new payroll tax on employers; and he also contemplates several increases in the corporate income tax, including a new so-called windfall profits tax on oil companies.
Then there is the spending side of the ledger. Mr. Obama proposes a fully refundable Making Work Pay Tax Credit, which would have the government pay out $500 to each worker and $1,000 to couples — reminiscent of George McGovern’s 1972 election proposal for the government to send a $1,000 check to everyone.
His American Opportunity Tax Credit would provide a $4,000, fully refundable tax credit for college tuition expenses.
[comment]:ok, this isn’t a bad idea imho. Americans needs more education imho
His Mortgage Interest Tax Credit would provide a 10% credit — refundable — to offset mortgage interest payments for lower- and middle-income families.
His Health Care Tax Credits, which the campaign says “will ensure that health insurance is available and affordable for all families,” include “a new refundable 50 percent health tax credit on employee premiums paid by employers.”
Currently existing tax credits would also become spending programs in the Obama tax program. The Savers Credit would be made fully refundable, and would be expanded, according to the campaign, “to match 50% of the first $1,000 of savings for families that earn under $75,000.” The Child and Dependent Care Tax Credit would be made refundable and expanded to allow “low-income families to receive up to a 50 percent credit on the first $6,000 of child care expenses.”
The Earned Income Tax Credit is already refundable. Mr. Obama would expand it to “increase the number of working parents eligible for EITC benefits, increase the benefits available to noncustodial parents who fulfill their child support obligations, increase benefits for families with three or more children, and reduce the EITC marriage penalty, which hurts low-income families.” In short, welfare spending is to be increased by paying more money out to low-income income tax filers.
The latest Congressional Budget Office data shows the bottom 40% of income earners already pays no income taxes. Indeed, they receive a net payment from the federal income tax system — meaning from the taxpayers — equal to 3.8% of all federal income taxes, because of the refundable tax credits under current law. The middle 20% of income earners, the true middle class, pays 4.4% of federal income taxes.
Overall, the bottom 60% of income earners pay less than 1% of federal income taxes on net. When “tax credits” primarily go to this group in the form of checks from the government (rather than a reduction in their tax burden) it is simply an abuse of the language to call the spending a tax cut.
Consequently, to say, as the campaign does say, that the candidate’s tax plan is a tax cut on net — and that it would limit taxes to 18.2% of GDP — is grossly misleading. The Obama tax plan would sharply increase real taxes.
It also would come nowhere near to paying for the massive increases in federal spending he has proposed, including the spending that is disguised in the form of refundable tax credits.
August 31, 2008 at 8:25 AM #264256CoronitaParticipantHave any of you seen this from the from the online WSJ commentary?…..Thoughts?
—–
Barack Obama’s tax plan is the opposite of supply-side economics. He proposes to raise marginal rates for just about every federal tax. He also proposes a raft of tax credits that taxpayers can receive if they engage in various government-specified activities.
Moreover, the tax credits would mostly go to those who pay little or nothing in federal income taxes. His trick is to make the tax credits “refundable.” Thus, if the tax credit is for $1,000, but the taxpayer would otherwise only pay $200 in taxes, the government would write a check to the taxpayer for $800. If the taxpayer pays nothing in federal income taxes, the government would pay him the whole $1,000.
[comment] not only folks don’t pay taxes back, they get a rebate
Such credits are not tax cuts. Indeed, they should be called The New Tax Welfare. In effect, Mr. Obama is proposing to create or expand a slew of government spending programs that are disguised as tax credits. The spending on these programs is then subtracted from the total tax burden, in order to make the claim that his tax plan is a net tax cut overall.
On the tax side of the ledger, the details released by his campaign last week confirm what a President Obama has in mind for our most productive citizens. The top individual income tax rate, for example, would be increased by 13%, to 39.6%; the next-highest rate would be raised to 36%. The top rates on capital gains and dividends would rise by a third, to 20%
The Social Security payroll tax would be raised between 16% to 32% for families making over $250,000 a year. This means that the real returns these people get from their lifetime payments into the retirement program will be driven below 0%.
[comment] So basically some folks paying into a SSN will essentially not see most of it when they retire. That’s not a “savings plan”
Mr. Obama also wants a permanent federal estate tax, with a top rate of 45%; his health-insurance plan includes a new payroll tax on employers; and he also contemplates several increases in the corporate income tax, including a new so-called windfall profits tax on oil companies.
Then there is the spending side of the ledger. Mr. Obama proposes a fully refundable Making Work Pay Tax Credit, which would have the government pay out $500 to each worker and $1,000 to couples — reminiscent of George McGovern’s 1972 election proposal for the government to send a $1,000 check to everyone.
His American Opportunity Tax Credit would provide a $4,000, fully refundable tax credit for college tuition expenses.
[comment]:ok, this isn’t a bad idea imho. Americans needs more education imho
His Mortgage Interest Tax Credit would provide a 10% credit — refundable — to offset mortgage interest payments for lower- and middle-income families.
His Health Care Tax Credits, which the campaign says “will ensure that health insurance is available and affordable for all families,” include “a new refundable 50 percent health tax credit on employee premiums paid by employers.”
Currently existing tax credits would also become spending programs in the Obama tax program. The Savers Credit would be made fully refundable, and would be expanded, according to the campaign, “to match 50% of the first $1,000 of savings for families that earn under $75,000.” The Child and Dependent Care Tax Credit would be made refundable and expanded to allow “low-income families to receive up to a 50 percent credit on the first $6,000 of child care expenses.”
The Earned Income Tax Credit is already refundable. Mr. Obama would expand it to “increase the number of working parents eligible for EITC benefits, increase the benefits available to noncustodial parents who fulfill their child support obligations, increase benefits for families with three or more children, and reduce the EITC marriage penalty, which hurts low-income families.” In short, welfare spending is to be increased by paying more money out to low-income income tax filers.
The latest Congressional Budget Office data shows the bottom 40% of income earners already pays no income taxes. Indeed, they receive a net payment from the federal income tax system — meaning from the taxpayers — equal to 3.8% of all federal income taxes, because of the refundable tax credits under current law. The middle 20% of income earners, the true middle class, pays 4.4% of federal income taxes.
Overall, the bottom 60% of income earners pay less than 1% of federal income taxes on net. When “tax credits” primarily go to this group in the form of checks from the government (rather than a reduction in their tax burden) it is simply an abuse of the language to call the spending a tax cut.
Consequently, to say, as the campaign does say, that the candidate’s tax plan is a tax cut on net — and that it would limit taxes to 18.2% of GDP — is grossly misleading. The Obama tax plan would sharply increase real taxes.
It also would come nowhere near to paying for the massive increases in federal spending he has proposed, including the spending that is disguised in the form of refundable tax credits.
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