Shell Game : Check your returns: your taxes weren't cut, just shifted!

[G_j]

http://tompaine.com/feature2.cfm/ID/10222

Shell Game


Chuck Collins is program director at United for a Fair Economy and co-author, with Bill Gates Sr., of Wealth and Our Commonwealth: Why America Should Tax Accumulated Fortunes (Beacon, 2003).

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<snip>
Tax Shift #1: From Federal Taxes to State Taxes. Since 2002, state governments have closed $200 billion in budget gaps by raising taxes and cutting services. During those same years, newly enacted federal tax cuts delivered about as much money—$197.3 billion—in new tax breaks for the wealthiest 1 percent of Americans (households making more than $337,000 a year). In essence, Bush chose to force tax hikes in the states in order to give tax breaks to multi-millionaires.

Tax Shift #2: From Progressive to Regressive Taxes. President Bush has focused on reducing income tax rates. But 71 percent of us pay more in payroll taxes (Social Security and Medicare) than in income taxes. Payroll taxes are regressive: high-income people pay a lower tax rate than low-income people. The opposite is true of progressive taxes, such as federal income, corporate and estate taxes. Since the early '60s, this trio of progressive tax rates has dropped precipitously. But the regressive payroll tax rate has risen.

Tax Shift #3: From Taxes on Wealth to Taxes on Work. Politicians talk about the virtues of hard work, but their tax policies speak otherwise. Between 1980 and today, the main tax rate on work income—the payroll tax—has jumped 25 percent. In the same period, top tax rates on investment income and large inheritances have been cut between 31 and 79 percent.

This tax shift from wealth to work means that a person who derives millions of dollars in dividend income solely from his investments now pays a marginal tax rate of just 15 percent. Compare that with a schoolteacher with an adjusted gross income over $28,400 who pays a payroll tax rate of 15.3 percent, plus a marginal income tax rate of 28 percent, for a total marginal rate of more than 43 percent!

Tax Shift #4: From Corporations to Individuals...........
...more...
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Free Riders
by Lee Drutman
When coporations dodge taxes, the rest of us pick up the difference.
http://tompaine.com/feature2.cfm/ID/10220
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[NMDemDist2]

1. DUH! Ya think?

and I'm self employed (for now) and the "bite" is all but killing me. Almost ready to become a wage slave again.

[girl gone mad]

5. Me too..

SE taxes are killing me this year. Also, in the business I'm in, I'm certain a lot of my competitors don't even file taxes.

[Paradise]

2. Tax Shaft! n/t

[RobertSeattle]

3. From our generation to the next...

Good stuff

[G_j]

4. doesn't this make you want to pull your hair out?

"Between 1980 and today, the main tax rate on work income—the payroll tax—has jumped 25 percent. In the same period, top tax rates on investment income and large inheritances have been cut between 31 and 79 percent."


"a person who derives millions of dollars in dividend income solely from his investments now pays a marginal tax rate of just 15 percent. Compare that with a schoolteacher with an adjusted gross income over $28,400 who pays a payroll tax rate of 15.3 percent, plus a marginal income tax rate of 28 percent, for a total marginal rate of more than 43 percent!"

[keithyboy]

7. But you can't make ditto-heads understand this. The Republicans

have convinced them that they have to pay taxes on "unearned" income. They think the Republicans were fighting to cut their payroll taxes when all the time they were fighting to cut taxes on their "unearned income."

[Pow_Wow]

9. actually i think both parties.

are responsible for the trend.

[G_j]

8. kick

[Blue Gardener]

6. On the cover of Newsweek

"The Dirty Little Secret of the Tax Cut, Why It's Smaller Than You Think"