Today the House is expected to vote on what to do about the expiring Bush tax cuts.
The Democratic proposal would extend them for the middle class, while ending them for income above $250,000 — the top 2%. The Republican proposal would extend them for everybody, but that means the lion’s share of the benefits actually go to the top 2%.
Republicans generally defend their desire to give big tax breaks for the wealthy by using the middle-class part as a shield — we don’t want to just cut taxes for the rich, we want to cut them for everybody!
But faced with sticking to that message and admitting that President Obama passed his own tax cuts, or revealing that they really believe in low taxes for the successful and higher taxes for the working stiffs … well, you can guess what they chose.
the House bill, which purportedly extends all tax cuts, would actually raise taxes on about 25 million families by rolling back enhancements to tax credits enacted under President Obama in 2009. Specifically:
11 million families paying for college would lose American Opportunity Tax Credits worth an average of $1,100. This tax credit defrays a larger portion of tuition costs than previously existing credits, is available to third- and fourth-year college students, and is partially refundable (up to $1,000 can be claimed by students or families even if they do not owe federal income tax in a given year).
12 million families raising children would lose some or all of their Child Tax Credits, costing them an average of $800. The Child Tax Credit provides a $1,000 per-child credit to reflect the costs of raising children. An improvement enacted in 2009 enhanced many low-income families’ eligibility for the tax credit by allowing them to count more of their earnings toward the credit’s refundable portion.
6 million working families would lose some or all of their Earned Income Tax Credits, costing them an average of $500. In 2009 the Earned Income Tax Credit was also expanded to provide an additional benefit for families with three or more children. In addition, the tax credit’s “marriage penalty” was reduced, meaning that couples who get married and combine their earnings do not lose as much of the credit as they did before. The House Republican bill’s failure to extend this provision is notable given the party’s expressions of concern for reducing marriage penalties in the tax code.
This is not just the looney House Republicans going rogue. The Senate GOP bill did the same thing. And the Mitt Romney tax plan also cuts taxes for the wealthy and raises them on the poor and middle class. The Washington Post reports:
His rate-cutting plan for individuals would reduce tax collections by about $360 billion in 2015, the study says. To avoid increasing deficits — as Romney has pledged — the plan would have to generate an equivalent amount of revenue by slashing tax breaks for mortgage interest, employer-provided health care, education, medical expenses, state and local taxes, and child care — all breaks that benefit the middle class…
…Even if tax breaks “are eliminated in a way designed to make the resulting tax system as progressive as possible, there would still be a shift in the tax burden of roughly $86 billion [a year] from those making over $200,000 to those making less” than that.
There’s really no getting around this.
The Democrats want a more progressive tax system. The Republicans want a more regressive tax system.
The Democrats believe bigger paychecks for the middle class will boost demand and spur economic growth. The Republicans say handouts to the wealthy will mean more investment and jobs, despite the colossal failure of the Bush tax cuts when Bush was president.
The choice is yours. Click here to tell the House want you want.