Mr. President, Raise My Taxes

10:09 am in Uncategorized by stewartm

(My first FDL Post)

Your 1040

You do not need to “negotiate” with the Republicans and ConservaDems. The tax cuts — ALL of them — will expire if nothing is done. They are the ones who need action, not you.

You say that you don’t want to “hit Middle Class Americans” with a tax increase? Well, guess what? The bill that you favor still gives the largest amounts to the wealthy. It moreover only raises the top tax rate on capital gains up to 20 %, compared to past when it was 28 %, and only raises the top dividend taxes to 20 % (instead of 39.6 %).  There’s a lot not to like in your tax proposal, either, starting with the fact that the tax system still rewards people who sit on their duffs all day and click on Wall Street trades rather than actually working and creating things for a living.

You really, really, really, want to help most of America? Then I suggest doing the following:

a) Let ALL the Bush-era tax cuts expire.

b) Take a look at the standard deduction and personal exemption in our tax system. Here it is for a single person (just to take a simple example):

Standard Deduction: $5700

Personal Exemption: $3650

This totals to $9350. That much of a single person’s person is exempt from taxation.

Now let’s look at the poverty guideline cutoff: $10830. That’s higher than the tax cutoff.

Mr. President, why do we insist on taxing people who are below the poverty line??

In fact, who do YOU know of who could really live on $10830 a year and make ends meet?

Here’s your middle-class tax cut, and how it should be presented. Let all the Bush-era tax rates expire. Then let’s calculate the poverty line to be a lot more realistic. Then let’s raise all the standard deductions and personal exemptions to cover that, on the principle that the very poor should not have to hand over to the government money that they need for food, clothing, and shelter. That might mean raising these by 50 %, at the very least. Maybe even doubling them.

That would provide not only some relief to the poor, but also provide the middle class with their tax cut without giving terribly much to the wealthiest. It would also probably give a prettier CBO score on the deficit.