Rangel's Tax Increase Proposal

[Engineer]

Originally posted by: Queasy

Originally posted by: heyheybooboo

Originally posted by: Wreckem

Originally posted by: Pabster
Story here.

Charlie's got the tax hammer in full swing. Who will be struck next?

Well the top 5% already pays more in taxes than they did before Bush's tax cut.

And this really doesnt matter, in 15-20 years, taxes will be atleast 50% higher than they are no with the top tax bracket cracking 60%.

Me personally, if I could do it, id save a whole crap load of money over the next 15-20 years an expatriate to the caribean. A las that is not likely to happen, and I will be here when my generation takes over power with American in shambles...

Individual Income Tax Receipts (millions of $)

2005 . . . . . 2,153,859
2004 . . . . . 1,880,279
2003 . . . . . 1,782,532
2002 . . . . . 1,853,395
2001 . . . . . 1,991,426

2000 . . . . . 2,025,457
1999 . . . . . 1,827,645
1998 . . . . . 1,721,955
1997 . . . . . 1,579,423
1996 . . . . . 1,453,177

Individual income taxes as a percentage of overall receipts:
2000 - 49.59%
2005 - 43.05%
That would be a decrease of 13.19%.

Office of the President - Budget of the US Gov't

Come again?

It would have been correct to say that the top 5% pay more to the income tax than any other group prior to the Bush tax cuts. The top 1% earn 17% of the nation's income but pay ~38% of the income tax dollars. I can't remember the distribution for the top 5% but it is similar....I think around 50% of the total income tax dollars...and has also increased since the Bush tax cuts.

Btw, you're leaving out 2006.

They still pay a lower "rate" than they did before the tax cuts. The only reason that they are paying more of the lions share is that their incomes have went through the roof, period.

 

[Engineer]

Originally posted by: CPA
I like a National Sales Tax even better.

Of course, it would make most of your retirement accounts such as the Roth IRA and Roth 401k worthless, unless you just held the money and didn't spend it. Not only worthless, but double taxed (as would any savings account that you have already paid taxes on and used for future purchases).

 

[Queasy]

Originally posted by: Engineer
They still pay a lower "rate" than they did before the tax cuts. The only reason that they are paying more of the lions share is that their incomes have went through the roof, period.

That and more individuals moved into higher tax brackets and a couple of million tax payers were taken off the income tax rolls altogether due to the cuts and increase in the child tax credit.

 

[Engineer]

Originally posted by: Queasy

Originally posted by: Engineer
They still pay a lower "rate" than they did before the tax cuts. The only reason that they are paying more of the lions share is that their incomes have went through the roof, period.

That and more individuals moved into higher tax brackets and a couple of million tax payers were taken off the income tax rolls altogether due to the cuts and increase in the child tax credit.

If those people moved into the higher tax brackets (that are constantly being shifted upwards), then they too are making more money. Even those people are paying a lower "rate" than they would have before the Bush tax cuts.

 

[Engineer]

I haven't read the OP (yet) but I'm not for raising taxes. Shifting them around to give me a better rate is fine though!

 

[CPA]

Originally posted by: Engineer

Originally posted by: CPA
I like a National Sales Tax even better.

Of course, it would make most of your retirement accounts such as the Roth IRA and Roth 401k worthless, unless you just held the money and didn't spend it. Not only worthless, but double taxed (as would any savings account that you have already paid taxes on and used for future purchases).

I understand that there would be an initial burden here, but there are ways around it, including temporary tax credits or subsidation.

 

[techs]

Originally posted by: CPA

Originally posted by: techs
Oh Noes, tax rich people?
Lower taxes on Corporations?
How dare the Democrats do that?

Fixed. You keep conveniently leaving this part out.

Damn neoc-con, Republican brainwashing.

 

[heyheybooboo]

You guys need to read the OP link. Pabs has been cherry-picking and misrepresents the entire article.

Rangel Tax Plan's Centerpiece Is 30.5% Top Corporate Rate

The plan would also require companies to defer deductions for certain expenses of foreign subsidiaries of U.S. companies until the money is repatriated to the U.S.

A lobbyist tracking the bill said the provision would likely hurt those who benefited most from an October 2004 Act allowing a one-time amnesty to repatriate foreign income at reduced tax rates. Companies lobbied for the break arguing they would be able to use the money to create new jobs, but there has been little evidence to suggest that is what happened.

The surtax will also make possible an expansion of the earned income tax credit, an increase in the standard deduction, and an increase in the value of the child tax credit for those earning too little to owe federal income taxes.

A third section of the plan would address a number of pressing tax issues, including a temporary patch of the alternative minimum tax prior to Jan. 1, 2008, and the extension of a number of expiring tax provisions.

Absent a patch, the alternative minimum tax will expand to hit roughly 25 million taxpayers, up from 4.4 million in 2006, increasing their taxes by a total of nearly $50 billion, according to congressional estimates.

Part of the cost of the third section of the bill would be offset by taxing carried interest paid to financial managers as regular income and not as capital gains. The change wouldn't apply to real estate investment trust managers.

Revenue-raising measures in this third section also include a tax on deferred compensation plans of offshore hedge funds and a requirement that financial service providers give customers information on basis of sold securities.

The plan also changes current laws to require small businesses in the services sector to pay payroll taxes for their workers.

Middle and upper-middle income families would benefit under the plan from a repeal of the alternative minimum tax starting Jan. 1, 2008.

Upper-income families, however, would pay for that repeal with a 4% surtax on incomes above $150,000 for a single earner or incomes above $200,000 for a married couple. That surtax would grow to 4.6% for incomes above $500,000.

It ain't perfect - but it's nothiung like Pabs title and 13 word comment make it out to be

 

[alchemize]

Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

 

[Brovane]

Originally posted by: Queasy

Originally posted by: Brovane

Originally posted by: Common Courtesy

Originally posted by: Brovane
Looks good to me. With a increase of around 4% on incomes above $200k. So basically any income above that level will be taxed more. The GOP has already started howling about this one.

I love this quote. - In anticipation of Rangel's plan, Rep. Jeb Hensarling, R-Texas, and other GOP conservatives wrote their colleagues Wednesday urging them to oppose any proposal to raise taxes to pay for the elimination of the AMT. "The correction of tax mistakes should never be offset with tax increases," they wrote.

The correction of tax mistakes should never be offset with tax increases. You got to be kidding me. How else do you expect to pay for correction of the tax mistake? Just keep running up the nations Debt?

Cutting spending will work better

Were would you cut spending to pay for this? I think you would need to cut spending by around 1 trillion over 10-years. Defense? Entitlements?

I think you could start with all the pork projects where Congress critters name buildings after themselves and give kickbacks to campaign contributers.

That is not going to work because what you might define as pork people living in the area of the project might consider it vital to there community. There has been attempts to cut back on pork for decades and has never been successful. I don't see how it would be successful now. Everybody seems to be for cutting pork as long as it doesn't affect a project in the area that they live.

 

[heyheybooboo]

Originally posted by: alchemize
Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

How about $200k? $250k ???

Put a number out there . . .

 

[child of wonder]

Originally posted by: alchemize
Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

Where I live $200,000 for a family is upper class. Even $150,000 would be upper class.

My wife and I make $84,000 combined right now and our family of 4 is living pretty damn well.

 

[fskimospy]

Originally posted by: alchemize
Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

$150 on the coasts is very wealthy. The median income for a San Diego county household is around $65k. A household making $150,000 or more in the US puts you (approximately) in the top 6% of all income earners according to the US census bureau. How is that "firmly middle class" again? And considering that more then 50% of the US population lives on the coast, I fail to see how a top 6% income 'isn't jack' there.

Strangely enough when I was in the navy I got by on about $55,000 a year VERY comfortably in one of the more expensive housing markets in the entire country.

 

[Queasy]

Originally posted by: Brovane

Originally posted by: Queasy

Originally posted by: Brovane

Originally posted by: Common Courtesy

Originally posted by: Brovane
Looks good to me. With a increase of around 4% on incomes above $200k. So basically any income above that level will be taxed more. The GOP has already started howling about this one.

I love this quote. - In anticipation of Rangel's plan, Rep. Jeb Hensarling, R-Texas, and other GOP conservatives wrote their colleagues Wednesday urging them to oppose any proposal to raise taxes to pay for the elimination of the AMT. "The correction of tax mistakes should never be offset with tax increases," they wrote.

The correction of tax mistakes should never be offset with tax increases. You got to be kidding me. How else do you expect to pay for correction of the tax mistake? Just keep running up the nations Debt?

Cutting spending will work better

Were would you cut spending to pay for this? I think you would need to cut spending by around 1 trillion over 10-years. Defense? Entitlements?

I think you could start with all the pork projects where Congress critters name buildings after themselves and give kickbacks to campaign contributers.

That is not going to work because what you might define as pork people living in the area of the project might consider it vital to there community. There has been attempts to cut back on pork for decades and has never been successful. I don't see how it would be successful now. Everybody seems to be for cutting pork as long as it doesn't affect a project in the area that they live.

The best way to fight pork is to increase the transparency of who submits the pork, what project the pork is for, etc. Unfortunately, the new "Most Ethical Congress Evar!" is actively removing what little transparency there is and more and more Congress Critters from both sides of the aisle are waddling up to the trough.

 

[Queasy]

Originally posted by: senseamp

Originally posted by: Queasy

Originally posted by: senseamp
Long overdue. What they should really do is remove SS tax cap.

No. Social Security is supposed to be a retirement insurance plan. What you put in is what you get back (though it really is a ponzi scheme because of government corruption). Removing the SS tax cap will simply result in income redistribution.

Even then, it will only add a few more years of solvency to SS. It needs a much greater reform than that.

I don't care what it's "supposed" to be. I know what it is now.
SS funds are being used to fund general spending. So general revenues should be used to fund SS. So SS tax should just be rolled into income tax, not be a regressive tax.

Well, then you are calling for a complete change in how SS if funded then. Incidentally, this isn't that different from the Fair Tax where all payroll taxes are eliminated and SS, Medicare, and everything else is funded from the general fund via the National Sales Tax.

 

[alchemize]

Originally posted by: heyheybooboo

Originally posted by: alchemize
Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

How about $200k? $250k ???

Put a number out there . . .

Hmm combined income? I would say you enter "upper class" when you have two people that are above managerial level pay, so say $125-150K each. So $250K - 300K, again depending on location.

 

[alchemize]

Originally posted by: eskimospy

Originally posted by: alchemize
Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

$150 on the coasts is very wealthy. The median income for a San Diego county household is around $65k. A household making $150,000 or more in the US puts you (approximately) in the top 6% of all income earners according to the US census bureau. How is that "firmly middle class" again? And considering that more then 50% of the US population lives on the coast, I fail to see how a top 6% income 'isn't jack' there.

Strangely enough when I was in the navy I got by on about $55,000 a year VERY comfortably in one of the more expensive housing markets in the entire country.

Sure, a single guy with roommates can live comfortably in the 50-75K range. Expenses include rent, gas, food and beer...I was there at one point in my life.

A family with kids wanting to feed, cloth them, pay medical bills, send them to college and maybe retire someday? No...very far from "rich".

 

[CPA]

Originally posted by: techs

Originally posted by: CPA

Originally posted by: techs
Oh Noes, tax rich people?
Lower taxes on Corporations?
How dare the Democrats do that?

Fixed. You keep conveniently leaving this part out.

Damn neoc-con, Republican brainwashing.

convenient excuse.

 

[alchemize]

Originally posted by: child of wonder

Originally posted by: alchemize
Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

Where I live $200,000 for a family is upper class. Even $150,000 would be upper class.

My wife and I make $84,000 combined right now and our family of 4 is living pretty damn well.

It is very dependent on location anymore. Middle class in Kansas is poor in LA.

Personally, I'm w/ CPA - I think a national sales tax is the best answer. Get rid of this tax class warfare we've created, get rid of all the loopholes. Reduce 90% of the IRS...

 

[CPA]

Upper-income families, however, would pay for that repeal with a 4% surtax on incomes above $150,000 for a single earner or incomes above $200,000 for a married couple. That surtax would grow to 4.6% for incomes above $500,000.

Also, nice to see another marriage penalty built in.

 

[heyheybooboo]

I'll throw some numbers out . . .

In 2004 - 132,226,042 tax returns

129,204,606 tax returns were less than $200k.

119,469,037 tax returns were less than $100k.


4% surtax on incomes above $150,000 for a single earner or incomes above $200,000 for a married couple

Looks like 1% or less of Americans * $200,000 for a married couple* - not that I'm engaging in class warfare. I did have to pay $128 in AMT tax a few years ago and I make well less than $100k/year. Anything that starts to address AMT is a good thing.

Tax numbers from Individual Income Tax, All Returns: Sources of Income and Adjustments (XLS) from our good friend, Uncle IRS.

 

[Queasy]

Originally posted by: alchemize
Personally, I'm w/ CPA - I think a national sales tax is the best answer. Get rid of this tax class warfare we've created, get rid of all the loopholes. Reduce 90% of the IRS...

But then how would the politicians be able to demonize each other for votes? And what will all the lobbyists do if they are no longer able to lobby for tax breaks, exceptions, and special rules?

Won't someone think of the politicians and lobbyists!

 

[child of wonder]

Originally posted by: alchemize
It is very dependent on location anymore. Middle class in Kansas is poor in LA.

Personally, I'm w/ CPA - I think a national sales tax is the best answer. Get rid of this tax class warfare we've created, get rid of all the loopholes. Reduce 90% of the IRS...

I agree.

The FairTax is a pretty decent proposal from what I can tell. However, I think it should also expand on the prebate a bit more (such as offering 50% prebate on sales tax for up to 2x the poverty level) but, all in all, it seems to be a much fairer and simpler system.

 

[Jaskalas]

Originally posted by: techs

Originally posted by: Jaskalas

Originally posted by: techs
Oh Noes, tax rich people?
Lower taxes on the middle class?
How dare the Democrats do that?

We should cap incomes at $100,000 and watch the fireworks. If eliminating wealth is such a great idea.

Yeah, that adds a lot to the discussion. Claim any increase in taxes on the wealthy means capping incomes. Or claim the terrorists win.

You'll always need more money as a stopgap for socialism failing to provide for the poor. Capping incomes is the culminating scheme, the point at which you've taken all that you possibly can.

Does it scare you to suggest this, that once you get all that you want and can take no more that it might not work, that it might not be enough money to patch the broken system?

Why waste our time raising taxes incrementally, in slowly boiling the frog to death, afraid it might hop out of the pot?

Think of all the good that will come out of the proposed tax hike! Now using the same logic, think of all the good my proposal will do. You can swear to the people that it would eliminate poverty altogether, that it would be the utopia you strive for.

Come on Techs, we know this tax hike is not the last, it certainly wasn?t the first. Ever since Karl Marx wrote down this scheme of taking and giving we have been following it incrementally, continuously inching closer to the end game. Why bother waiting another 5-10 years to add another 5% to our taxes, why not ?help? the American people today, if these ideals are so good for them?

 

[CPA]

Originally posted by: heyheybooboo
I'll throw some numbers out . . .

In 2004 - 132,226,042 tax returns

129,204,606 tax returns were less than $200k.

119,469,037 tax returns were less than $100k.


4% surtax on incomes above $150,000 for a single earner or incomes above $200,000 for a married couple

Looks like 1% or less of Americans * $200,000 for a married couple* - not that I'm engaging in class warfare. I did have to pay $128 in AMT tax a few years ago and I make well less than $100k/year. Anything that starts to address AMT is a good thing.

Tax numbers from Individual Income Tax, All Returns: Sources of Income and Adjustments (XLS) from our good friend, Uncle IRS.

Engaging in class warfare is exactly what you are doing when you use statistics like that to support your argument.