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Old July 29th, 2014, 08:44 AM   #1
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House Votes To Cut Taxes For The Wealthy Raise Them On The Poor

Cutting taxes for the wealthy? Again? | MSNBC



This unnervingly dishonest op-ed for USA Today this week, House Speaker John Boehner (R-Ohio) assured voters his party isn’t just obsessed with going after President Obama. “At the same time,” he argued, “we remain focused on the American people’s top priority: jobs and the economy.”

What possible rationale could there be to justify such a claim? It’s actually pretty simple: House Republicans continue to pass tax cuts. Ergo, Boehner thinks he’s telling the truth when he claims the GOP is focused on “jobs and the economy,” all evidence to the contrary notwithstanding.

It didn’t get much attention, but late last week, House Republicans quietly approved yet another tax break, this time advancing a tax policy that benefits the wealthy while hurting the poor. Danny Vinik had a good piece on this:
Here’s how the [Child Tax Credit] currently works: Couples receive a maximum credit of $1,000 per-child, meaning they can lower their tax bill by that amount.

For instance, a couple with two kids and an income of $50,000 would owe $8,356 in federal income taxes. With the CTC, they would reduce their tax bill by $2,000, to $6,356. However, not everyone is eligible for the credit. Those with income below $3,000 cannot collect it. And for couples, the credit begins phasing out at $110,000 and is entirely phased out at $150,000. For singles, those numbers are $75,000 and $115,000, respectively.

Thus, the current design of the CTC creates a marriage penalty. For instance, imagine a couple where each person makes $60,000. Separately, they would both be eligible to collect the full credit. But combined, their income ($120,000) would exceed the current phase-out threshold for couples filing jointly. Therefore, the couple could maximize their after-tax income by living together, but not marrying.

Now, there’s very little to suggest this disincentive actually has a real-world impact, but House Republicans nevertheless advanced a policy they’ve wanted for years: they made it so that a couple can collect the same tax break, even if they file jointly. The same bill raised the phase-out ceiling to $150,000 and indexed it to inflation. The price tag: $115 billion over the next decade.

What’s wrong with that? If you’re a deficit hawk, quite a bit, but there’s a more glaring concern here: the House GOP measure was structured to punish the poor while benefiting the rich.

On the one hand, we have a new break for the upper-middle class, including households making up to $150,000 a year, which will be indexed to inflation. Any chance we can also index policies like the minimum wage to inflation? Of course not; that’s socialism.

On other hand, current law on the Child Tax Credit also has a provision that makes more low-income Americans eligible to receive the tax break, but it expires in 2017. What does the new bill from House Republicans do about this? Nothing.

In other words, the GOP structured the legislation in a fairly specific way: making things better for wealthier earners, while making things tougher for the working poor.

Vinik, citing CBPP data, added, “If the House legislation became law, the Center for Budget and Policy Priorities estimated that a couple making $160,000 a year would receive a new tax cut of $2,200. On the other hand, the expiring provisions of the CTC would cause a single mother with two kids making $14,500 to lose her full CTC, worth $1,725.”

Kevin Drum’s summary rings true: “So we have a deficit-busting tax cut. It’s a cut only for the upper middle class. It’s indexed for inflation, even though we’re not allowed to index things like the minimum wage. And the poor are still scheduled for a tax increase in 2017 because this bill does nothing to stop it. It’s a real quad-fecta. “
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Old July 29th, 2014, 08:50 AM   #2
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Republicans play a shell game with tax policy. They always have.
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Old July 29th, 2014, 08:57 AM   #3
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Quote:
Originally Posted by skews13 View Post
Cutting taxes for the wealthy? Again? | MSNBC



This unnervingly dishonest op-ed for USA Today this week, House Speaker John Boehner (R-Ohio) assured voters his party isn’t just obsessed with going after President Obama. “At the same time,” he argued, “we remain focused on the American people’s top priority: jobs and the economy.”

What possible rationale could there be to justify such a claim? It’s actually pretty simple: House Republicans continue to pass tax cuts. Ergo, Boehner thinks he’s telling the truth when he claims the GOP is focused on “jobs and the economy,” all evidence to the contrary notwithstanding.

It didn’t get much attention, but late last week, House Republicans quietly approved yet another tax break, this time advancing a tax policy that benefits the wealthy while hurting the poor. Danny Vinik had a good piece on this:
Here’s how the [Child Tax Credit] currently works: Couples receive a maximum credit of $1,000 per-child, meaning they can lower their tax bill by that amount.

For instance, a couple with two kids and an income of $50,000 would owe $8,356 in federal income taxes. With the CTC, they would reduce their tax bill by $2,000, to $6,356. However, not everyone is eligible for the credit. Those with income below $3,000 cannot collect it. And for couples, the credit begins phasing out at $110,000 and is entirely phased out at $150,000. For singles, those numbers are $75,000 and $115,000, respectively.

Thus, the current design of the CTC creates a marriage penalty. For instance, imagine a couple where each person makes $60,000. Separately, they would both be eligible to collect the full credit. But combined, their income ($120,000) would exceed the current phase-out threshold for couples filing jointly. Therefore, the couple could maximize their after-tax income by living together, but not marrying.

Now, there’s very little to suggest this disincentive actually has a real-world impact, but House Republicans nevertheless advanced a policy they’ve wanted for years: they made it so that a couple can collect the same tax break, even if they file jointly. The same bill raised the phase-out ceiling to $150,000 and indexed it to inflation. The price tag: $115 billion over the next decade.

What’s wrong with that? If you’re a deficit hawk, quite a bit, but there’s a more glaring concern here: the House GOP measure was structured to punish the poor while benefiting the rich.

On the one hand, we have a new break for the upper-middle class, including households making up to $150,000 a year, which will be indexed to inflation. Any chance we can also index policies like the minimum wage to inflation? Of course not; that’s socialism.

On other hand, current law on the Child Tax Credit also has a provision that makes more low-income Americans eligible to receive the tax break, but it expires in 2017. What does the new bill from House Republicans do about this? Nothing.

In other words, the GOP structured the legislation in a fairly specific way: making things better for wealthier earners, while making things tougher for the working poor.

Vinik, citing CBPP data, added, “If the House legislation became law, the Center for Budget and Policy Priorities estimated that a couple making $160,000 a year would receive a new tax cut of $2,200. On the other hand, the expiring provisions of the CTC would cause a single mother with two kids making $14,500 to lose her full CTC, worth $1,725.”
Kevin Drum’s summary rings true: “So we have a deficit-busting tax cut. It’s a cut only for the upper middle class. It’s indexed for inflation, even though we’re not allowed to index things like the minimum wage. And the poor are still scheduled for a tax increase in 2017 because this bill does nothing to stop it. It’s a real quad-fecta. “
Seriously? Are you retarded? Did your mother smoke and/or use ETOH during her pregnancy? People who make $3,000 or less don't even pay taxes & the single mom with 2 kids probably doesn't either. The others in the so called middle class get less of a break so what the Fuck is wrong with that. You don't understand economics at all. Any way our tax code is all screwed up and needs to be completely revised.
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Last edited by roastpork; July 30th, 2014 at 09:52 AM.
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