With a typical two children family getting about $1000, and the rich getting richer..if the plan were more graduated (I think, or whatever the opposite of it is now), how much more money would they expect to have?
How much more money would people get if it weren't a trickle down tax cut?
- Thread starter Syringer
- Start date
CADsortaGUY
Lifer
The opposite of the tax cut we are getting, would be a tax increase
I think what you meant to say was "what if we cut taxes equally for all tax brackets except for "the rich"
CkG
Considering the poor dont pay much in taxes, it is hard to give them a big tax break. We could of course give them more money than they pay in taxes, but that would be called welfare, not a tax cut.
LunarRay
Diamond Member
- Mar 2, 2003
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Well... if you increase the earned income tax credit you could..
trikle down
read this..
demand side dogma
I'm not in agreement with this in total but, it is worth reading
The linked article did not mention FICA/MED. But even if we gave a FICA/MED cut/holiday, the "wealthy" would still get most of the cut as it is paid on percentage basis of income.
LunarRay
Diamond Member
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Comments in Committee way back when suggested that it would be a way to offest Fica for the poor because the effect on a 25000 person was regressive when the cut off (at the time) was 53000 for Er and Ee. The higher earner paid no fica on the balance of income.. You can look at the EIC as what is effectivly does today.
25000 has what a taxable income of (family of four) say 8000 at 10 %= 800 tax with 2 child credits of 600 he has no income tax. but, gets about 700 or so EIC refund... to offset FICA or whatever.
I am not against a FICA/MED cut. My point was that even if this tax was removed, it would be a much bigger win for the "wealthy" as the "wealthy" pay more to FICA/MED.
You point about EIC offsetting FICA/MED is somewhat valid. It just means that the individuals getting EIC also get the benefits of FICA/MED without paying. No matter how you want to cut it, they are getting money or service without payment.
Off-topic Maybe I'm misinformed but why don't we give corporations tax credits for providing health insurance/care to their employees? Wouldn't this kill two birds with one stone? Provide health insurance/care to everyone who is working and put money back in everyone's pocket?
This isn't a "trickle down" tax cut. Now that the bill has passed, estimates are that it is almost purely a simple tax reduction without a change in the tax structure. By that I mean that the evaluations I have seen indicate, for example, that the top 5% of wage earners paid about 57% of the total income tax before the reduction and will pay about 57% after the reduction. Of course they get a higher absolute reduction but we've been over all that before.
This was a tax reduction bill. If we want an income redistribution bill, that will have to be another effort. Also, if we want a tax simplification bill, it will have to be done in the future because this bill sure doesn't do it.
Bush asked for tax reduction and he got it. The argument over fairness of this bill belongs with the argument over who really won the 2000 election. Get over it.
If you think it's unfair that the top 5% of earners pay only 57% of the income tax, start writing your representatives and suggest a tax redistribution bill. But be honest about it. Don't whine about "tax breaks for the rich". Say what you think is right. Should the top 5% pay 75% instead of 57%? Should the top 50% pay 100% instead of 96%? Give us some numbers to vote for.
This was a tax reduction bill. If we want an income redistribution bill, that will have to be another effort. Also, if we want a tax simplification bill, it will have to be done in the future because this bill sure doesn't do it.
Bush asked for tax reduction and he got it. The argument over fairness of this bill belongs with the argument over who really won the 2000 election. Get over it.
If you think it's unfair that the top 5% of earners pay only 57% of the income tax, start writing your representatives and suggest a tax redistribution bill. But be honest about it. Don't whine about "tax breaks for the rich". Say what you think is right. Should the top 5% pay 75% instead of 57%? Should the top 50% pay 100% instead of 96%? Give us some numbers to vote for.
LunarRay
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This UQ, just now occured to me as well.... that would indeed kill lots of birds. At least catastophic health care but, I'd wan't to see a HMO type that also was supported by the Health Care Professionals. Yeah, It costs us (my company) a fortune and I toyed with the idea of giving the Ee's an allowance to get their own on their own but, when I researched the cost for them it was much greater than if through our set up. Some of them would not get it and use the funds elsewhere. We've had increases of 15% and 25% in last two years. Workers Comp just went up 25% this year. It is killing the notion of hiring because of the discrimination rules, but I could assign some folks to a "class of employee" to avoid this but, won't. At the moment we could hire two more people in the construction co and two in the engineering co. all this is real but, we hold off on some bidding or sub out just because of the "package" 401k, health, etc that has to be offered.. (our plan is set up so 30 days wait is all that is required) The sub out option is not really an option because of the tech in the eng co. Some would say well someone gets the work... yup. rather they get the work so their folks get to work 35 hrs vs 20 or so a week. Our guys are into OT.
But does it make sense? Would companies do it? If we gave them full credit for health care costs would they ante up and cover their employees? It wouldn't cost them anything except maybe what? Cost of capital? Administrative costs? What would they do with the extra money (the ones who have a med. plan now that is)? A plan like this may also lower health care costs across the board as HMO's and insurance companies compete for business.
The down side I guess would be a possible loss of tax revenue if the money saved isn't put back into the economy.
Bowfinger
Lifer
- Nov 17, 2002
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I don't believe that's quite accurate. Obviously the people who pay the most dollars get the greatest reduction in dollars. However, according to an analysis in the local paper, the wealthy also get a much greater percentage reduction. According to their chart, the average wage-earning family gets only about a 1% reduction while $100K plus get over 2% and $1 million+ get 4% or more. I suspect this is due in part to the new preferential treatment of capital gains and dividend income, but the paper didn't offer that level of detail.
Anyone have a link to a good analysis?
Sorry but I don't have a good link right now. The Internet is really frustrating sometimes. However, I think there is something way off on the numbers you are quoting from your paper. Here is some info from MSNBC.com (It's a strange pop up data thing so I couldn't figure out how to link.)
Single, age 65, $33K income - tax before - $2858, after $2508, savings $350 (12%)
Head of House. 1 child $30K income - before $1435, after $1035, savings $400 (28%)
Married two children $50K income - before $2678, after $1545, savings $1133 (42%)
Single, $50K income - before $7686, after $7360, savings $326 (4%)
Married, two children $100K income - before $12162, after $9820, savings $2342 (19%)
Single 100K income - before $18813, after $17302, savings $1511 (8%)
Married, two children, 300K income - before $69607, after $60767, savings $6919 (10%)
Note that this is all over the map, depending on marital status and children. This bill makes lots of changes to individual tax liability based on the new rules for child credits and dividends and marital status. However, the analysis I saw (and can't find again) indicated this would all even out when looked at by income groups. There well may be a big bonus for the top 1% due to the dividend change and the max rate reduction but the assessment I saw didn't break it down to a 1% segment.
Be careful in reading the news reports. I saw a couple of very misleading news stories that compared before and after "total tax liabilities". These analyses lumped social security, medicare and state taxes with income taxes and then demonstrated that the new taxes will benefit the rich more. This is an incorrect comparison since these other taxes are already regressive (and not truly taxes in many cases) therefore, an across the board reduction in the progressive portion (income taxes) will automatically look like it favors high income earners. Income tax law is completely independent of the other tax laws and they cannot be both addressed in one bill.
Marginal tax rates in 2000 are as follows:
15% 28% 31% 36% 39.6%
are replaced with
10% 15% 25% 28% 33% 35%
These rates bring much tax releif across the board. The President did only request 4 rates in the initial plan(10,15,25,33). This will bring a tax break to all.
LunarRay
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Ok here's the standard talk... "I'll noodle it out a bit but, on first blush there seems to be something in this. Give me a day or two and I'll get the numbers together and see what falls out"
Here's the deal. In my case we are sub chapter S corps. so all the income/loss flows to the owner on a cash basis.. no biggie but, the point is a dollar of contra tax is a dollar in the pocket to a person who sits back trying to figure out how much he made last month on each employee.. (direct Ee)
Right now we cover Ee cost and 50% of dependent cost. The single or spouse has a better plan folks miss out on the delta benefit. We have to have a plan because we cannot otherwise compete with the SAIC or other big boys for the talent we need in Mech or Elec Engineers. But, we need another few people... maybe. Depends on the economic spending of the clients... and what happens tomorrow. The aspect I no longer deal with... we ask the client.
If I were in a co. that currently had no health care and needed it to attract the talent a credit would be the icing on the cake. I'd jump at it.
The overall cost of health care in the country ought to go down as more folks join because of the marginal cost issue... fixed cost per patient goes down... but, such a credit would be enormous.
How about a national health plan that all Er subscribe to for x dollars if they don't have a plan in force. Most would drop their plan (little guys like us under 25m) and opt for the National one. We'd save $ be able to hire people and the problem would be stuck in the debt for tomorrow..
Got to think on this a bit.. more. have lots of thoughts running about in my foggy brain.
OK I was with ya all the way up until the national health care part. I am totally opposed to any more gov't programs. They are inefficient in both cost and process. Private sector is the way to go.
LunarRay
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I am a fiscal conservative trying to also fund my social liberal bent.
I thought about how much it would cost the treasury to credit Er for health care and concluded it would be astronomical. I think health care clinics for the poor exist in most big cities... not sure in rural America. I'd be in favor of direct credits as there are in California and as I remember the Federal too for Er who employ the "hard core unemployed" and create in law (errissa and other discrimination tested perks) the ability for employers to, in fact, discriminate against certain class of Ee. with the proviso that after X period of time (1-2) years or so they would granfather into the mainstream benefit scheme.
This has the highest multiplier... the credit comes back in the form of tax from the Ee hired and he produces and creates demand people spend and the circle continues.. But, we also could credit mfg like solar use to be to stimulate sectors of mfg which has a high multiplier.. I mentioned in the other tax spending thread some issues I have with the tax cut... I think it is low by $400b plus mis directed..
CADsortaGUY
Lifer
No offense to HJD1 since he seems to be atleast thinking about how things will affect other things. What I find slightly amusing is it just like a Democrat(read Liberal) to bitch and moan about Tax-cuts and how they "cost" us money(which they don't
) but yet they push for National health coverage which would add hundreds of Billions of dollars to our budget. Do we need to make health insurance more accessable to working americans? Yes. But we sure as hell don't need national health care "insurance" - because we already have it. If you are sick - you go to the emergency room and they will treat you - regardless of your insurance status. Now I'm not as ignorant so as to believe they get the same level of care as those of us who are insured, but health insurance is kind of like car insurance - those of us with insurance get treated better at the body shop than those who don't have insurance.But anyway, Charrison posted the "new rates" anyone still care to say this is a tax-cut only for the rich? Seems to me that anyone who pays taxes will get a tax break.
CkG
LunarRay
Diamond Member
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Originally posted by: CADkindaGUY
No offense to HJD1 since he seems to be atleast thinking about how things will affect other things. What I find slightly amusing is it just like a Democrat(read Liberal) to bitch and moan about Tax-cuts and how they "cost" us money(which they don't
But anyway, Charrison posted the "new rates" anyone still care to say this is a tax-cut only for the rich? Seems to me that anyone who pays taxes will get a tax break.
CkG
Cadification.... see my post above yours... I was thinking out loud about the national health care issue and see it as a nice to have costly to have but, maybe needed to help the needy.
Originally posted by: CADkindaGUY
No offense to HJD1 since he seems to be atleast thinking about how things will affect other things. What I find slightly amusing is it just like a Democrat(read Liberal) to bitch and moan about Tax-cuts and how they "cost" us money(which they don't
But anyway, Charrison posted the "new rates" anyone still care to say this is a tax-cut only for the rich? Seems to me that anyone who pays taxes will get a tax break.
CkG
So you are satisfied with people using the emergency room as their primary care physician? How much money is wasted by people going to the ER for basic healthcare?
CADsortaGUY
Lifer
Originally posted by: HJD1
Originally posted by: CADkindaGUY
No offense to HJD1 since he seems to be atleast thinking about how things will affect other things. What I find slightly amusing is it just like a Democrat(read Liberal) to bitch and moan about Tax-cuts and how they "cost" us money(which they don't
But anyway, Charrison posted the "new rates" anyone still care to say this is a tax-cut only for the rich? Seems to me that anyone who pays taxes will get a tax break.
CkG
Cadification.... see my post above yours... I was thinking out loud about the national health care issue and see it as a nice to have costly to have but, maybe needed to help the needy.
I know, that's why I said "no offense"
You aren't in the group I was talking about But now that you mention it
Why don't we have "free" housing? you know... for those needy people Why don't we have "free" uniform....uh I mean clothes....for the needy I mean really, if we would all just ante up 40-50% of our income we could house, feed, cloth all the needy people. Heck while we're at it, why don't we just give everyone a job? - you know...for those who don't have the fortune of having one. Uhh......yeah...then again...maybe notInsurance isn't a right, it is an optional safeguard against substantial monetary damage if you become ill. Basic Health Care is (as it should be) a right afforded all humans, but health coverage (insurance) isn't.
CkG
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