Dueling Tax Plans: Whose Is Better For The 98%?
What we’ve seen lately from Team Obama is an attempt to shit the dialogue from his terrible handling of the economy and the notion that Obama is out of ideas by offering up…..the retread idea of class warfare by raising taxes on “the rich”. ABC News takes an actual look at what the tax plans of the two campaigns are, and finds out
The fight over creating jobs morphed into the battle of the tax plans this week after President Obama renewed his call to let the Bush Tax cuts expire for people earning more than $250,000 per year, a policy his Republican rival Mitt Romney dubbed a “kick in the gut.”
But while the rhetoric over taxes revolves around what the wealthiest Americans will pay, little attention has been given to how the other 98 percent of Americans — those that will most likely decide the 2012 election — will fare under Obama’s or Romney’s tax proposals.
The short of it is under Romney’s plan, taxes will go down for nearly every taxpayer. Under Obama’s plan, middle and low income earners will pay virtually the same amount as they currently pay, while people earning more than $250,000 will see their taxes go up by between 2 percent and 5 percent.
Obama’s plan isn’t really a plan: it’s just a little policy change to existing tax law. Coming up with a plan himself would interfere with all his campaigning, golfing, and partying.
Taken as a whole, Romney’s plan reduces taxes for three-fourths of tax payers by an average of $4,700, the Tax Policy Center estimates. Obama’s plan would lower taxes for 12 percent of filers and raise taxes for about 27 percent. Nearly every person whose taxes would go up under Obama’s plan earns more than $250,000 per year, according to the Center’s analysis.
Romney wants a 20% cut across the board for income tax brackets…..I will say that one of the problems with the Bush tax cuts is that it made way to many people have an effective zero percent federal tax liability.
Romney would also extend the Bush tax cut provisions that keep the tax rate for capital gains and dividends at 15 percent and eliminate all federal income taxes on those investment incomes for people earning less than $200,000.
Obama would allow that provision of the Bush tax cuts to expire for people earning more than $250,000, making the tax rate on capital gains jump to 20 percent and dividends taxes rise to 39.6 percent.
So Obama wants to raise the income taxes on small business owners and tax the heck out of people who typically are the ones who provide capital to business. Raising taxes means that those with the money have less to feed back into the economy as it goes directly to the federal government, which is not known for being wise stewards of that money. Raising the dividend tax could see a 30% drop in the value of dividend stocks
People who earn less than $250,000 and do not directly see their investment taxes go up will still be affected if they own mutual funds or have a 401K retirement plan, both of which could see their value go down because of the increased tax rates on dividends, McBride said.
Obama is simply using class warfare rhetoric without any thought as to what havoc his policies would create.