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Tax Cuts Extension Back on the Drawing Board.
Posted: Sat Oct 30, 2010 9:20 pm
by Foxfyre
The White House is heading back to the drawing board to determine the fate of the Bush tax cuts, amid fears Congress will not approve a plan to hike taxes on the nation's wealthiest families if Republicans take an expected House majority in next Tuesday's election, The Washington Post reported Saturday.
The Obama administration is mulling a strategy that would break apart the Bush tax cuts, according to sources familiar with the matter. The plan would call for a permanent extension of cuts for families earning less than $250,000 a year, and a temporary extension of cuts on income above that level.
The proposed "decoupling" of tax provisions would delay a decision on cuts for the so-called "rich" until next year or the year after, the sources said.
Republican leaders have pushed to extend the Bush tax cuts, which expire in December, for all income brackets, while President Obama insists that the country cannot afford to keep tax breaks on income over $250,000 a year for families, or $200,000 for individuals.
Partisan haggling blocked a vote on the cuts before elections, but Congress is expected to take-up debate again in mid-November, most likely with a new Republican majority in the House and additional GOP seats in the Senate.
While preferring a permanent extension across income brackets, Republican leaders have said they would accept a two-year extension of all the cuts.
White House officials confirmed they were reviewing a strategy for the lame-duck legislative session but declined to comment on decoupling or other compromises such as backing tax breaks for the rich in exchange for Republican approval of additional stimulus.
American taxpayers could see increased rates reflected in their January paychecks if Congress does not approve an extension before the end of the year.
From Fox news.....
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 1:58 am
by Mikey
Of course - the rich can't be expected to be able to pay more than other people!
Oh, wait, they can... that's what "rich" means.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 3:40 am
by Tsukiyumi
Foxfyre wrote:...the so-called "rich"
Seriously?
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 6:45 am
by Foxfyre
Tsukiyumi wrote:Foxfyre wrote:...the so-called "rich"
Seriously?
I know, figured this would be a interesing talking point.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 6:49 am
by Vic
The problem is where do you make the cut off between 'rich' and just well to do Tsuki? Many in this country see making the "rich" pay a higher tax than normal as punishing them for being sucessful. Never mind that it is the "rich" that meet the vast majority of the tax burden in this country already.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 6:55 am
by Foxfyre
Vic wrote:The problem is where do you make the cut off between 'rich' and just well to do Tsuki? Many in this country see making the "rich" pay a higher tax than normal as punishing them for being sucessful. Never mind that it is the "rich" that meet the vast majority of the tax burden in this country already.
I agree that the cut off would be a bit hard to peg however those that make a decent amount should pay a bit more. You make more you pay a bit more seems fair to me.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 7:39 am
by Reliant121
No doubt that someone will moan that it violates the American dream. Well we do it over here (to some extent anyway) and it works fine.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 8:11 am
by Tsukiyumi
Vic wrote:The problem is where do you make the cut off between 'rich' and just well to do Tsuki? Many in this country see making the "rich" pay a higher tax than normal as punishing them for being sucessful. Never mind that it is the "rich" that meet the vast majority of the tax burden in this country already.
I'm not suggesting that people who work hard from nothing should be penalized for being successful; I think the folks making 200k + on their own should pay a reasonable 37%, and people making more than, let's say 2mil + should get a new 42% bracket. People making more than 50mil per year should be perfectly comfortable paying in a new 50% or even 60% bracket.
Also, these people are paying the vast majority of the tax burden because they earn in the neighborhood of 80% of the money in this country, while the majority of
working people have to fight over the left over scraps. What's the complaint? They can't buy a second yacht this year because they had to pay to help finance health care for the poor or the sorely needed overhauls of the nation's power grid and road/bridge system? Cry me a f*cking river.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 1:21 pm
by stitch626
The problem with this (as far as I can tell) isn't that the "penalize rich" is from an extra tax or tax increase, but its because the plan would give a tax break to lower income while not giving the break to the not so lower income.
Kinda like the thought that giving a kid with disabilities accommodations penalizes the kids without disabilities.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 2:15 pm
by IanKennedy
stitch626 wrote:The problem with this (as far as I can tell) isn't that the "penalize rich" is from an extra tax or tax increase, but its because the plan would give a tax break to lower income while not giving the break to the not so lower income.
Kinda like the thought that giving a kid with disabilities accommodations penalizes the kids without disabilities.
Well done you've spotted the entire idea of schemes like this. It's how the British tax system (and most others around the world) have worked for years. For example in the UK:
The first £6,475 of anything you earn is tax free.
The amount you earn from £6,475 to £37,400 you pay 20% on.
The amount you earn from £37,401 to £150,000 you pay 40% on.
Anything you earn above £150,000 is taxed at 50%.
So for example if you earn £5,000 you don't pay tax.
If you earn £36,000 you pay £5,905 in tax (ie £36,000 - £6,475 @ 20% = £29,525 @ 20% = £5,905
£60,000 you pay £12,265 (ie First £6,475 for free, £37,400 - £6,475 @ 20% = £6,185 plus £60,000 - £37,400 @ 40% = £9,040. giving the total of £15,225)
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 2:37 pm
by Deepcrush
The problem is that the UK's tax system includes a lot more then that of the US.
I have always personally believed that tax rates should be fixed. By that I mean congress comes together and says "This is the tax rate" and then thats it for the whole country.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 3:45 pm
by Tsukiyumi
Deepcrush wrote:The problem is that the UK's tax system includes a lot more then that of the US.
I have always personally believed that tax rates should be fixed. By that I mean congress comes together and says "This is the tax rate" and then thats it for the whole country.
Flat tax or only sales tax sounds good in principal, but let's break that down real quick:
Congress passes a law that says the new tax rate is 30% for everyone.
Person A makes $20,000 per year.
Person B makes $50,000,000 per year.
Person A now pays $6,000 in taxes, leaving them with only $12,000 and near poverty.
Person B now pays $15 million in taxes, leaving them with only $35 million and less able to buy the island they want down in the Bahamas this year.
See the problem there?
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 5:11 pm
by Deepcrush
Tsukiyumi wrote:See the problem there?
Honestly, I don't. If you have a flat tax that says you are charged this amount and those taxes cover your basic needs as a citizen then it shouldn't matter. That rich guy is still paying more and thats because he has more. The problem with our system isn't who pays what, its who's covered by what.
If I'm a good law following citizen then I'm SoL. If i'm a criminal or an illegal or Black then the government will pay for whatever I want. Thats the problem, not the tax rate but what its going to.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 6:24 pm
by Tsukiyumi
Deepcrush wrote:...If you have a flat tax that says you are charged this amount and those taxes cover your basic needs as a citizen...
You mean like transportation, health care, and higher education? At the moment, these things
aren't covered, so you're proposing more than just a change to tax laws.
Not that I disagree with that.
Re: Tax Cuts Extension Back on the Drawing Board.
Posted: Sun Oct 31, 2010 6:48 pm
by Mikey
The problem is that fundamental attitude - that taxes should be based on what "the other guy" is paying. Fairness shouldn't be the issue. If I make $50 mil in a year and I'm charged $20 mil in taxes, then sure - that 40% is a lot higher than what I'd pay if I make $30,000. But I'd still have $30 mil left in that year's income. What people should be thinking about is what they can give for national programs and still be as comfortable - NOT how much they can keep from the government.
Conversely, that guy who makes $30,000 (while trying to support dependents on that, BTW) could only be charged $1,000 in taxes - but that $1,000 is a lot more precious to him than the $20 mil to the guy who makes $50 mil.