Republican Tax Reform

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WHAT CAN YOU DO?

Go and explore the bill text for yourself at FairandSimple.gop. Republicans are releasing their plan for tax reform, free of media filters and bureaucratic doublespeak.

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The GOP says its plan is an effort to “fix our broken tax code,” and there can be no doubt that the code is broken. Our fabulously wealthy nation is mysteriously plagued by poverty. More than 40 million Americans currently live in poverty, including 11.5 million children. Over 41 million people live in what the U.S. Department of Agriculture defines as “food insecure households.” Millions of Americans literally could not afford to eat at some point during 2016. Families living a little higher up the economic ladder generally have a tenuous hold on their middle-class status: 78 percent of U.S. households report living paycheck to paycheck.

The GOP tax plan won’t resolve any of those problems. Republicans have assembled a host of tax changes that will ensure that more and more of the nation’s wealth goes to the people who already have most of it. It’s a strategy to inflate existing fortunes, increase profits on Wall Street and enhance the social dominance of people who make their living from investments over people who make their living earning wages and salaries.

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I hate to say it but from the look of it, for us it would actually lower our taxes. You raise that standard deduction to 24k and then only want 12% after that and yeah. Trump's better for us than Obama was.

Democrats "tax and spend."

Republicans cut taxes and borrow from the unborn.

NoCoPilot wrote:

Democrats "tax and spend."

Republicans cut taxes and borrow from the unborn.

Hey, I ain't sayin that it's a right path. I am sayin' that it would take less out of our pocket at a time when I'm literally struggling to keep my home and that I'm fine with the building of the future not being done on the backs of the lower working class. I also don't see anyone with a plan for what really needs doing.

Adding $2.2T to the debt is not conservative; it's financial foolhardiness.

I don't feel qualified to judge whether lowering the corporate tax rate from 35% to 20% would help businesses or not, but I know the highest tax brackets are too low.  Raising the lowest tax rates is not a good idea.  Trickle-down economics has been resoundingly discredited, yet here we are again, giving tax breaks to the super-wealthy and raising them on the poor, in the vain hope that, maybe, possibly, for some reason, this time it might work to jolt the economy.


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The bill would repeal the individual Alternative Minimum Tax — which primarily affects households with incomes from $200,000 to $1 million — and would maintain preferential rates for investment income. It would also repeal the estate tax after six years, in the meantime doubling the amount of inherited wealth that is exempt from the tax to $11 million from $5.5 million.

https://www.nytimes.com/interactive/2017/09/27/us/politics/six-charts-to-explain-the-republican-tax-plan.html
https://www.nytimes.com/2017/11/02/us/politics/tax-plan-republicans.html

Jenni wrote:

I hate to say it but from the look of it, for us it would actually lower our taxes. You raise that standard deduction to 24k and then only want 12% after that and yeah. Trump's better for us than Obama was.

Yes, the standard deduction was raised, but the personal exemptions were removed. You should expect to save forty to fifty dollars on your income tax (less if you are single). In the top one percent, the average tax savings is around $130,000. You won't notice a difference in your income  (less than one dollar a week), but the national debt will go way up and guess who will wind up paying it. And who will have needed services cut, including medical? Not the wealthy, that's for damned sure.

Look for the attempted privatization of Medicare before Trump leaves office.

That's the first step in eliminating it.

The proposed Republican budget slashes over a trillion dollars from Medicare and Medicaid over the next ten years. That's a pretty good start.

There should be a Constitutional amendment that morally bankrupt people cannot hold any government office, whether elected or appointed.

American was great before Roosevelt's New Deal:

• Banks were essentially unregulated
  
• All paper money was backed by gold
  
• Consumption and production of alcohol was illegal
  
• Wall Street was unregulated
  
• There were no public works, no bridge or highway initiatives, no waterways cleanup, no farm price support or market control
  
• No Social Security
  
• No government programs encouraging home ownership
  
• No worker protections, no food & drug protections, no medicine standards
  
• Tax rate on incomes over $5 million was 79%.  It affected one person: John D. Rockefeller
  

Bear in mind, Trump's idea of "great" looks a lot like John Steinbeck's "Grapes of Wrath."

Doing some quick math, using what data on the new tax plan are available, it looks like my federal income tax will go up a few thousand next year. State income taxes will no longer be deductible. This is what a middle class tax cut looks like?

For anyone who has any doubts, it's always safe to assume that any Republican tax plan will always raise the taxes of nearly every tax payer except the very wealthy, who will get massive cuts.

_Howard wrote:

This is what a middle class tax cut looks like?

No. Who said it was middle class? Those aren’t the people funding the effort, it’s the American Heritage Foundation and the Cato Institute and American Crossroads. You know, the evil billionaires.

However, the religious nut jobs on the committee managed to slip some anti-abortion language into a tax reform bill, by defining a child as “any Homo sapiens in any stage of development.” One more step toward illegalizing abortion.

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It takes some audacity to slide ostensibly “pro-life” language into a bill whose egregious tax cuts for the wealthy would be funded by life-threatening cuts to Medicaid and Medicare. It’s also completely unnecessary as a matter of tax policy. People can already open 529 plans, the savings accounts in question, under their own names to save for college before their child’s birth. All they need to do is switch the account beneficiary to their child once she’s born. The only way fetuses could suffer under the current 529 regulations would be if they matriculated at a university before exiting the womb, thereby requiring their college funds earlier than most.

NoCoPilot wrote:

_Howard wrote:

This is what a middle class tax cut looks like?

No.  Who said it was middle class?

That was a rhetorical question.
The fucking Republicans say it's a middle class tax cut. They say every tax cut is a middle class tax cut. They never are, but there are a lot of people who believe them. That's one major way in which they continue to get elected.

Last night Chris Hayes had clips from several senators and representatives saying their campaign financing "will dry up" if they don't pass this tax plan.

They're not even being crafty about who is behind the reform plan. They're openly admitting it's a giveaway to the donor class, to the Kochs of the world.

At the expense of everybody else.

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“If there’s anything that unifies Republicans, it’s tax reform,” McConnell said last month after Trump lunched with GOP senators.

And yet two Republican representatives have already come out against the proposal, and three or four more are wavering in their support. If the House loses two votes it will not pass.

So, probably dead.

Yay, it's dead.

Don't hold your breath.

House just passed their version (surprisingly). Let's hope the Senate cannot reconcile their version.

Jesus, scary to think that five families can take over government policy like this.

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"The rich will not be gaining at all with this plan," Trump told reporters during a meeting with lawmakers in mid-September.

But analysts at the nonpartisan Tax Policy Center who studied the proposal reached a very different conclusion. They predict that nearly three-quarters of the savings from the tax overhaul would go to the top 20 percent of earners — those making more than $149,000. More than half the savings would go to the top 1 percent — people who earn more than $732,800. The tax breaks are even more tilted to the wealthy by the 10th year of the overhaul, when the Tax Policy Center projects nearly 80 percent of the savings would go to the top 1 percent of earners.

One nugget the alt-right keeps repeating is that the wealthy pay more than their fair share of the tax burden.

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The top 10 percent of income earners, those having an adjusted gross income over $138,031, pay about 70.6 percent of federal income taxes.  [That's a]bout 1.7 million Americans, less than 1 percent of our population, [yet they] pay 70.6 percent of federal income taxes.

The top 1 percent of income earners, those having an adjusted annual gross income of $480,930 or higher, pay about 39 percent of federal income taxes. That means about 892,000 Americans are stuck with paying 39 percent of all federal taxes.

They see this as unfair.

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The bottom 50 percent of income earners, those having an adjusted gross income of $39,275 or less, pay [only] 2.83 percent of federal income taxes.

But it would not be "fair" to have the bottom 50% of wage-earners pay 50% of taxes and the top 1% pay only one percent, because

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the share of wealth held by the 1 percent is 42 percent.

 Also, the lower wage earners spend 100% (or more) of their income to survive, while the wealthy have "excess" money as a result of the hard work of their low income employees.

Therefore, the tax burden -- to be equitable -- might have to track with the income percentage.

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the bottom 50 percent of taxpayers (those with AGIs below $36,841) earned 11.49 percent of total AGI.

Rather than a flat tax rate (15% as proposed by Rand Paul) the rate should be based on a progressive scale, starting at some arbitrary cost-of-living-comfortably.  Let's call that $60,000/yr.  The 50% of the population making $39,275 should get $20,725 in federal assistance (average) instead of being taxed at all.  The approx 20% of wage earners (I'm estimating) who make MORE than $60,000 should be taxed on their income above $60,000 at a rate increasing from about 30% up to 60 or 70% -- enough to fund the government, but not enough to stifle ambition.

Discussion?

(Incidentally, don't yell "Socialist."  This is essentially how taxation worked prior to Reagan, when our economy was booming.  Top tax rate dropped from 70% to 50% in 1982 to 38.5% in 1987 to 28% in 1988, 31% in 1991 and 39.6% in 1993.  It has remained mostly constant since then, although the number of taxpayers in the top 1% has fallen precipitously since 1980 as the rich got super-rich and the super-rich got obscenely-rich:  In 1980 the top 1% was incomes above $80,580.  In 2014 the top 1% was $465,626.

Incidentally I've been unable to find what percentage of (or how many) taxpayers paid which rates for various years.  That figure seems to be curiously unpublished.)

Republicans also want to slash the corporate tax rate from 35% to 20%.  This is also not "making America great again":

NoCoPilot wrote:

... although the number of taxpayers in the top 1% has fallen precipitously since 1980 as the rich got super-rich and the super-rich got obscenely-rich:  In 1980 the top 1% was incomes above $80,580.  In 2014 the top 1% was $465,626.

Incidentally I've been unable to find what percentage of (or how many) taxpayers paid which rates for various years.  That figure seems to be curiously unpublished.)

Is my logic way off here?  The "top 1% of earners" will always be the same PERCENTAGE (uh, one percent) but the actual numbers  will change with the number of taxpayers.  Regardless of income.

What I'm TRYING to find is what percentage of taxpayers fell into the seven tax tiers, or the twenty-some-odd in the 1980s.  I suspect as the top rates came down, the cutoff to get into the top tiers also came down and more people paid the lower top rate.  When the top rate was 94% only a tiny percentage paid that rate.  At least that's what I suspect.

Want to Make America Great Again?

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Income taxes were declared unconstitutional by the Supreme Court in 1895. This decision stood until the ratification of the 16th Amendment in 1913.

NoCoPilot wrote:

The approx 20% of wage earners (I'm estimating) who make MORE than $60,000 should be taxed on their income above $60,000 at a rate increasing from about 30% up to 60 or 70% -- enough to fund the government, but not enough to stifle ambition.

Right concept. Wrong numbers. The value of money varies widely in the USA, mainly because of housing costs. In many places, with an income of $60,000, you cannot qualify for a mortgage to buy even a tiny shack. When plumbers charge $100 per hour, $60K won't get you very far. I think the figure of $250K as a starting point for higher taxes is a valid starting point. But keep in mind that right now, in states with high income taxes, a $250K earner will pay more than 40% on earnings above $60K.

Differing views of what happened last night:

Brand New Congress wrote:

Moments ago, Senate Republicans rammed through a tax bill that is ripped straight from Depression Era politics. We don’t know much about this bill because (as multiple news outlets reported) they were literally rewriting it in the last few hours.

But here’s what we do know:

On the short list of winners you’ll find the Trump family, all the millionaires and billionaires in Trump’s cabinet and Congress, hedge fund managers, giant multinational corporations, and every other member of the establishment donor class.

The long list of losers includes you, me, and hundreds of millions of other Americans.

They were warned that this bill is going to hurt working class Americans. They were told it’s going to crush over 80% of small businesses. They know it’s going to explode our deficit and kill programs essential to our economy and our way of life. And they voted for it anyway.

Next, they're coming for Medicare and Medicaid. You can take that to the bank.

The Everyday American wrote:

If you haven’t heard, the Senate just voted to pass their version of the tax reform, a monumental step towards creating more jobs, increasing take home pay, and making life simpler for everyday Americans.

Who to believe? (Hint: I tend to favor facts over hyperbole.)