The Obama tax program involves increasing by a whopping 4% the tax rate for those whose adjusted gross income is over $250,000, and reducing taxes on everyone else.
Republicans have rightly pointed out that 40% of American households do not pay income tax -- although they more often wrongly just stop at saying that they do not pay taxes, period. From the second, wrong, statement, they assert that giving money to those who do not pay taxes is welfare, socialism and, now, communism.
Actually, these lower income people do pay taxes -- payroll taxes and medicare taxes that are quite significant. Lest anyone become apoplectic that revenues from those taxes are not part of the budget, think again: the social security trust fund has been making up the deficits in the US budget for decades. If it were not for appropriating the surplus in the social security trust fund, even the Republican Congress would have found it difficult to enact its tax cuts.
But even if that were not true, and that the social security trust fund were indeed in a 'lock-box', the Republicans have a bigger problem: the earned income tax credit ("EITC") that was enacted by Gerald Ford and then re-enacted and expanded in 1986 by... could it be, don't tell me, say it ain't so!... Ronald Reagan.
The EITC uses tax revenues (derived from our progressive tax system) to provide additional income to people below certain income levels under a formula so that it gradually phases out as incomes increases. Qualifying families receive a monthly check from the government.
So, Ronald Reagan was a redistributor. That must mean he was a socialist, even a communist.
That's what happens when you pal around with Mikhail Gorbachev.
oil rebate every year. This is the same State that the sharp tonged Palin
is gov. That to me smells a bit socialist using HER definition.
The right wingers like taking money but really hate the thought of letting
hardworking americans keep more of what they earn.
Also the capital gains tax needs to be reviewed for people who make their sole income (as in the case of Blackwater, inc.) on it. They pay 15% and 1/2 of their employee payroll taxes. If they were a schedule C (or F) then they would need to pay the SE tax (after the 1/2 SE above the line reduction). As a schedule D and their sole income source they also wouldn't have as much of a tax liability, unlike regular working americans. However, I'm not sure if they would qualify for AMT.
Aside from Reagan, the current Bush regime has shown itself to be a proponent of socialism with this bailout plan.
But they also believe that giving your tax dollars to the wealthy corporate elites is your duty.
http://online.wsj.com/article/SB121910303529751345.html?mod=googlenews_wsj
which cites a CBO study
http://www.cbo.gov/ftpdocs/88xx/doc8885/EffectiveTaxRates.shtml
This study divides tax filers into quintiles (fifths) and gives averages for these. The bottom two quintiles have zero tax liability on average. The WSJ editorial erroneously assigns the average of each quintile to the entire quintile, which is where the 40% number comes from.
To accurately calculate, download data from the IRS:
http://www.irs.gov/taxstats/index.html
2006 is the latest year for which details are available. What one finds is:
138M filings
194M taxpayers (accounting for married filing jointly/separately)
46M federal filings with zero income tax or 33% of filings.
59M taxpayers with zero income tax or 30% of filing taxpayers.
So the correct statement is, 30% of all federal tax filers have no federal tax liability after credits and deductions. This percentage will rise if more tax credits are applied but the current baseline is 30%, not 40%.
The state of journalism/fact-finding in the media business is frighteningly sad when the only piece of truth regarding tax burdens can be found exclusively on a blog comment while misinformation is spread pervasively not only on the Internet but on TV news stations, newspapers, radio stations, and magazines from coast to coast.
It says a lot about the greatest, richest, most powerful nation in the history of the world that 40% of households make too little to have to pay income tax.
Washington, literally, put Wallstreet millionaires on WELFARE and they have the nerve to criticize Obama to want to give to the underprivileged.
This truly is a sick country.
I was focused on federal taxes they pay as a counterfoil to assertions they pay no federal taxes.
The bottom line, of course, is that they need relief from the increased prices and declining real wages they have experienced over the last 8 years.