Mitt Romney's Tax Plan

[Number Six]

It is becoming apparent that Mitt Romney's tax plan is unbelievably regressive:

http://blogs.reuters.com/david-cay-john ... ld-tax-us/

[Judge Roy Bean]

It is becoming apparent that Mitt Romney's tax plan is unbelievably regressive:

http://blogs.reuters.com/david-cay-john ... ld-tax-us/

But the author ignores the fact that those in that realm don't pay taxes; the largess returned to them would be reduced.

[JamesVincent]

It is becoming apparent that Mitt Romney's tax plan is unbelievably regressive:

http://blogs.reuters.com/david-cay-john ... ld-tax-us/

But the author ignores the fact that those in that realm don't pay taxes; the largess returned to them would be reduced.

What he said. Something I and others have said before, the bulk of the people protesting these tax cuts and whatnot for the "wealthy" are not even paying taxes for themselves. The greatest increase in taxes, $157 for the $19k and under bracket would only decrease what they receive back by that amount and the next bracket for $82 would only bring it closer to $0. The biggest difference would be in the middle class which is what most people are complaining about and where everyone feels that the real struggle is right now. And, as the author rightly pointed out, the plan doesnt even benefit Romney himself. His tax burden wouldnt change, it would continue on as it is and I would presume the people in his bracket also would stay relatively the same. So the people who are actually paying the greatest amount of money would continue paying the greatest amount of money, the people in the middle would get a slight break to help out, and the people at the bottom wouldnt get as much back in EIC and CTC or in their actual tax refund for the second bracket.

[Number Six]

"Both urges, to pander awkwardly and to protect the prerogatives of his class, are at play in matters of policy. Romney’s proposed tax cut, writes The Washington Post‘s Ezra Klein, is roughly three times the size of George W. Bush’s 2000 proposal. It’s far more regressive—it would actually raise taxes on many working-class people, which Bush did not do—and would add to the deficit a hefty $600 billion.5 Likewise, Jonathan Cohn of The New Republic found that Romney’s proposed budget would cut at least 14 percent and perhaps 25 percent from every domestic program—on top of the cuts already slated to go into effect as a result of the congressional deal on the debt ceiling."6

http://www.nybooks.com/articles/archive ... tt-romney/

[JamesVincent]

"Both urges, to pander awkwardly and to protect the prerogatives of his class, are at play in matters of policy. Romney’s proposed tax cut, writes The Washington Post‘s Ezra Klein, is roughly three times the size of George W. Bush’s 2000 proposal. It’s far more regressive—it would actually raise taxes on many working-class people, which Bush did not do—and would add to the deficit a hefty $600 billion.5 Likewise, Jonathan Cohn of The New Republic found that Romney’s proposed budget would cut at least 14 percent and perhaps 25 percent from every domestic program—on top of the cuts already slated to go into effect as a result of the congressional deal on the debt ceiling."6

http://www.nybooks.com/articles/archive ... tt-romney/

So his cuts would actually do something for a change instead of pretending to cut something? Exactly how would it cause the middle class to pay more taxes when everything Ive seen written up on it states that not only would there be a straight across the board cut, there would also be capital gains and other tax cuts available for the middle class that werent before. And considering that the Washington Post is well known to be somewhere to the left of Teddy Kennedy Id bet they were hedging their info a little bit. If there is indeed 14-25% of ALL domestic programs cut I fail to see how that would raise the deficit by $600 billion considering that would be a savings somewhere around that number on top of the lesser amount of tax dollars paid back to the lower class and the cuts in EIC and CTC. Youd have to actually come up with numbers that make sense and not just a quote from a very liberal newspaper for me to understand that one.

[Number Six]

One purpose of taxes is to actually pay for essential government services so that the federal and state governments do not run up staggering deficits like we have now. And yes, reform in line with what the Simpson-Bowles commission calls for would involve in cutting government pork which is extensive.

It has all been thoroughly documented in dozens if not hundreds of books as to exactly why we have these deficits and who is responsible. Mr. Johnston is probably the leading authority in how the U.S. tax system has be corrupted to the benefitted of the super-rich and corporations. I don't think he is on the left or right politically, but an honest journalist, through and through. http://www.amazon.com/Perfectly-Legal-C ... 1591840198

[JamesVincent]

One purpose of taxes is to actually pay for essential government services so that the federal and state governments do not run up staggering deficits like we have now. And yes, reform in line with what the Simpson-Bowles commission calls for would involve in cutting government pork which is extensive.

It has all been thoroughly documented in dozens if not hundreds of books as to exactly why we have these deficits and who is responsible. Mr. Johnston is probably the leading authority in how the U.S. tax system has be corrupted to the benefitted of the super-rich and corporations. I don't think he is on the left or right politically, but an honest journalist, through and through. http://www.amazon.com/Perfectly-Legal-C ... 1591840198

Again, books and "documentation" aside, the bulk of the people in this country pay either zero or very little in taxes. The "super rich" pay in the vast bulk of what this country brings in for tax revenue while the highest % of taxes paid are paid by middle class professionals and workers. And, again, it has been brought up over and over how this is one of the few countries in the world that actually tax corporations as harshly as we do, thats why they all want to leave and go overseas. And none of which answers my original question: how does the plan that was quoted increase the tax burden of the middle class when the only thing Ive seen on it gives the middle class a straight tax break and offers them access to tax credits they use to not qualify for?

[Number Six]

I'm not a tax professional, maybe someone who is an expert on taxes could explain it, or you could contact Mr. Johnston on the basis for the assertion.

The idea that the wealthy and corporations are the heavy lifters when it comes to bearing the tax burdens has been refuted over and over again in terms of historical %s of tax burdens. Of course it is relative to where they live too, one NY Times writer described this week how he actually paid over 100% of his income in all taxes combined! Why work then if you can't take anything home? If the venture capitalists on "Shark Tank" are any indication of the civic mindedness of the wealthy and how they are so deserving, blah, blah, blah, and how they would create a lot more jobs if they were just given more money back from their already grievous tax burden--I seriously doubt the types of jobs they would create would be better than how a streamlined government could efficiently spend the money.

Too bad there are sections on this site that do not show up as active threads in the larger system.

[Dr. Caligari]

one NY Times writer described this week how he actually paid over 100% of his income in all taxes combined! Why work then if you can't take anything home?

That was an incredibly misleading claim. He pays over 100% of his "taxable income" in taxes, but a much lower percentage (about 40%, IIRC) of his "gross income." That is because "taxable income" is defined as gross income minus deductions, credits and exclusions.

[rogfulton]

That was an incredibly misleading claim. He pays over 100% of his "taxable income" in taxes, but a much lower percentage (about 40%, IIRC) of his "gross income." That is because "taxable income" is defined as gross income minus deductions, credits and exclusions.

If he's paying about 40% of his gross, he's doing it wrong. I realize that NY has a state income tax and NYC has a borough income tax, but Tebus.

I have prepared returns for professional athletes who are required to file in the states they play in on the road (I'm in Texas without a state income tax) and none of them paid that high a percentage.

[JamesVincent]

I'm not a tax professional, maybe someone who is an expert on taxes could explain it, or you could contact Mr. Johnston on the basis for the assertion.

The idea that the wealthy and corporations are the heavy lifters when it comes to bearing the tax burdens has been refuted over and over again in terms of historical %s of tax burdens. Of course it is relative to where they live too, one NY Times writer described this week how he actually paid over 100% of his income in all taxes combined! Why work then if you can't take anything home? If the venture capitalists on "Shark Tank" are any indication of the civic mindedness of the wealthy and how they are so deserving, blah, blah, blah, and how they would create a lot more jobs if they were just given more money back from their already grievous tax burden--I seriously doubt the types of jobs they would create would be better than how a streamlined government could efficiently spend the money.

Too bad there are sections on this site that do not show up as active threads in the larger system.

The biggest problem is no one has actually refuted anything, they may have claimed to but have not actually done so. It pretty common sense. Lets take Mitt Romneys income. He paid, what, $3 mill or so in taxes? I dont remember exactly and dont care enough to look it up again. IIRC 125 million or so people in this country recieved EIC last year, I believe the number was, again dont remember the exact number. So one person not only paid more then that 125 million, that 125 million cost every penny that he paid and another probably $400 million or so to boot. Lets look at the normal person making a low income. Say $10/ hour, easy number to play with. $400/ week, figure at the end of the year he makes his $21k and does his taxes. By the time he writes off his standard deduction which is what $8k or so? been awhile since Ive done one, and adds in whatever he actually paid in assuming a deduction of one, he is never going to owe and will always get a refund. If memory serves me correctly he should fall into the EIC range, again been awhile, and will get even more back from the government beyond what he paid in. And thats without writing off anything besides a standard deduction. The next tax bracket, up to $40k, is a little bit trickier but then you usually have writeoffs like cars and/or a house and kids to help offset your tax liability and will usually end up getting a refund or being close to zero. Its usually once you cross that line that things get hard and around $100k seems to be the hardest, at least talking to people in real life.

As far as the article from the NY Times, again, consider the source. And also common sense would dictate it is very hard to owe over 100% of your gross income unless you yourself do something really stupid. It is possible, and I can think of several ways, but again, it is because of something you did. And as was pointed out if hes actually referring to his taxable income and just being a nitwit and not clarifying that, hes still being stupid and should really figure out a better way to do his taxes. A good accountant is worth far more then the money paid to them.

[Judge Roy Bean]

I'm not a tax professional, maybe someone who is an expert on taxes could explain it, or you could contact Mr. Johnston on the basis for the assertion.

The idea that the wealthy and corporations are the heavy lifters when it comes to bearing the tax burdens has been refuted over and over again in terms of historical %s of tax burdens. ...

Nonsense.

Questioned and debated but hardly refuted. The reality is that the largest portion of the tax burden is carried by a very small percentage of the people and a large percentage of the population pays little or no tax at all. Another percentage of the population are net recipients, not payers.

[Number Six]

http://www.taxfoundation.org/taxdata/show/151.html

http://visualizingeconomics.com/2007/11 ... ome-group/

[JamesVincent]

http://www.taxfoundation.org/taxdata/show/151.html

http://visualizingeconomics.com/2007/11 ... ome-group/

Your second link. The first comment shows exactly the problem and why people who dont have a clue should not open their mouth. And I quote:

Any solution to the deficits, budget shortfalls, and tax reform misses the mark unless it addresses this shameful fact: Billionaire Warren Buffett pays 11% total (federal, state, local, corporate) taxes on $8billion annual investment gains while a single minimum wage worker pays 37% total taxes on her $14,500 annual salary

That minimum wage worker does NOT pay anywhere near 37% in taxes and anything she does pay in she gets back and then some at the end of the year. Warren Buffet doesnt. And probably pays accountants hundreds of thousands of dollars to figure it all out for them while that same worker has her taxes done for free through a service if shes smart. Again, no one has refuted anything, people have just refused to see the facts. And that 11% that Mr. Buffet paid in paid for a lot of the social programs that all the people that dont pay any taxes and sit around complaining that he doesnt pay enough taxes.

[Number Six]

If we had a couple dozen examples of the self-employed business owner, the employee and someone earning through investments at various levels of income, from $50K to $5 or $10 million, and you examined their taxation levels over the last 50 years, you would see a huge decrease in percentages as you went higher. Warren Buffet and capital gains stands out notably. Why was he complaining about that vs. his secretary? Because he was looking for publicity? No. Because he thought it was unjust. The idea that someone with a high frequency trading platform at a hedge fund should be paying 15% or less in taxes, while a self-employed logger, large employer, or secretary would be paying over 30% is ridiculous. And it is simply absurd for people to be backing millionaires and billionaires who think they are more deserving of smaller tax rates because they are smarter or better at management, etc.. We are talking unearned income vs. earned income; you could make the argument that there are a lot of hazards in investing, but those with the most have learned to minimize those downside risks and maximize their upsides. Some of the savvy investors call themselves "vampires"; do you honestly think those bloodsuckers deserve such low rates?

[Quixote]

That minimum wage worker does NOT pay anywhere near 37% in taxes and anything she does pay in she gets back and then some at the end of the year.

The taxpayer's refund, which is just an accounting correction, has nothing to do with how much she pays in taxes. Many low income taxpayers have payments and credits in excess of 37%. The question is how much does the government keep.

37% seems extremely high to me, but it isn't zero. The exact number would be hard to come by. If we assume the person making the comment was comparing apples to apples, that 37% is income tax alone. Her federal rate, assuming she's single and has no dependants, is 2.6% of gross. In the worst case scenario, she is unlikely to pay much more in city and state income taxes. So triple that to 7.8%. The person making the comment was probably not talking about income tax alone, but was comparing Buffet's income taxes to all taxes paid by the minimum wage worker. That includes social security taxes, which are somewhere between 7.65% and 15.3% depending on one's assumptions, excise taxes on gasoline, cigarettes, etc. and property taxes, direct or indirect. If she's a heavy user and pays her marijuana tax ($3.50/gram in Texas, $5/gram in Illinois), she might pay as high as 37% of gross, but I doubt it.

[Mr. Mephistopheles]

It is becoming apparent that Mitt Romney's tax plan is unbelievably regressive:

http://blogs.reuters.com/david-cay-john ... ld-tax-us/

But the author ignores the fact that those in that realm don't pay taxes; the largess returned to them would be reduced.

Two of the primary causes of the dramatic rise in the percentage of filers who have zero tax liability is the child tax credit and earned income credit instituted by GWB. If Romney rolls back those two programs then it's not unlikely that many of those "in that realm" will once again have a positive tax liability.

[JamesVincent]

That minimum wage worker does NOT pay anywhere near 37% in taxes and anything she does pay in she gets back and then some at the end of the year.

The taxpayer's refund, which is just an accounting correction, has nothing to do with how much she pays in taxes. Many low income taxpayers have payments and credits in excess of 37%. The question is how much does the government keep.

But it has everything to do with how much she pays. If she is single and we follow your example and she gets to the end of the year and writes herself off the standard deduction for a single person eliminates 75% of her income therefore her taxable income is a lot less the minimum of what they actually will collect from, which was what $6k the last time I was playing around with taxes. So she will have no tax liability and will get a refund of every penny she paid in, if not more. Your talking about the gross taxes she pays during the year which is really meaningless to discuss, Im talking about the net at the end of the year, which is relevant since that is what everyone is actually complaining about with people like Buffet. Their investments and things like that arent a job so they dont write paychecks that pay taxes out of those checks, for the most part, that is all done either annually or quarterly and then settled at the end of the year. Im talking about that net liability, not what gets paid in out of their paycheck and the two cant be compared since their two different things. And the last time I checked 11% was a lot greater then 0%, or even more accurate, -5%.

I dont see someone who makes $14k a year paying property taxes, local are usually adjusted by income level (at least here they are.. and that would be below poverty level) so she probably wouldnt pay those and our state taxes are based entirely off of federal returns, right down to the EIC, which she would qualify for. As for the other taxes on gas, cigarettes, etc. everyone pays them at the same rate so they would be the same across the board. Now if you want to add in something a higher earner might pay that a lower earner might not, gas guzzler tax, entertainment tax, fuel surcharge for boats, etc.

[webhick]

I dont see someone who makes $14k a year paying property taxes, local are usually adjusted by income level (at least here they are.. and that would be below poverty level) so she probably wouldnt pay those and our state taxes are based entirely off of federal returns, right down to the EIC, which she would qualify for.

Little quibble here: EIC cuts off at $13,660 for single with no kids. And the closer you get to that limit, the less of it you actually get. Last year, off $13,172 in income, EIC was only $37 and I paid $368 in taxes. It's a simple return with no kids and the standard deduction.

[JamesVincent]

I dont see someone who makes $14k a year paying property taxes, local are usually adjusted by income level (at least here they are.. and that would be below poverty level) so she probably wouldnt pay those and our state taxes are based entirely off of federal returns, right down to the EIC, which she would qualify for.

Little quibble here: EIC cuts off at $13,660 for single with no kids. And the closer you get to that limit, the less of it you actually get. Last year, off $13,172 in income, EIC was only $37 and I paid $368 in taxes. It's a simple return with no kids and the standard deduction.

I stand corrected. Was that gross or AGI? Does your state carry over EIC and poverty level adjustment like Maryland does?