New Independent Study Show Romney plan would cut taxes for the rich..

[g5000]

Let's say we eliminate ALL tax expenditures. No more mortgage interest rate deduction, no more child tax credits, etc.

This would increase revenues, certainly.

Let's say we then cut everyone's tax rate by 20 percent. If you were paying 33%, you now pay 26.4%.

The question then becomes, will you be paying more or less of your income to the federal government than you do now?

That question can only be answered by asking if you currently get more tax expenditures than you would get from a 20 percent cut.

Independent analysis has shown that the middle and lower incomes currently get more tax expenditures than they would get from a 20 percent cut, while the reverse is true for the wealthiest Americans.

So the rich would end up better off, and everyone else would end up worse off, tax-wise.

However, if we eliminate the mortgage interest tax deduction, the prices of houses would drop dramatically, thereby making them more accessible.

The mortgage interest tax deduction is an extremely regressive tax deduction.


There are lots of angles to consider. Not just looking only at the final tab on your tax bill. You also have to examine the consequences of tax reform, such as the drop in the prices of houses example.

But...the odds of Congress going along with eliminating the extremely popular mortgage interest rate deduction is a long shot to say the least. Americans just don't understand anything involving more than two moving parts.

So this means our collective stupidity would result in getting most of the downside and very little of the positive consequences.

Still, it should be done. We need some serious leadership on this. It must be done.

Too bad Mitt sucks at communication. He really, really, really sucks at it.

I think he sucks at math, too. More than he sucks at communication.

Do you have links to the data used in the independant studies? Maybe I've got it wrong, i'm willing to double check the facts and re-evaluate my position if you can provide me the sources.

Me personally, I make ~$40,000/year and the 20% cut will make it so I save 6,000 in taxes as I'm currently taxed at ~15% federally. My deductions are zero. So I'm not sure how you can say he is raising my middle class taxes but maybe he would raise other peoples this way. This is why I want the data used to come to that conclusion, I would like to see it myself so I know for a fact that what your saying is either right or wrong.

If you truly have zero deductions, you are not a typical middle class taxpayer. You have no mortgage interest rate deduction and no children.

The quote I provided a couple posts back clearly states that middle class people with kids will be hit hardest as their deductions exceed what a 20 percent tax cut would give back to them. "Thus a reform that imposed an across-the-board reduction in tax expenditures would increase taxes much more on families with children than on childless adults.”


That is a quote from the Tax Policy Center study which is the independent analysis to which I was referring, and which is the topic of this thread.

ETA: The Washington Post blog link I also provided explains how dodgy Romney has been with providing information to people trying to analyze his tax plan. And that suggests Romney is not being entirely forthright. He withholds information and then criticizes the methodology of analysts who are forced to make assumptions because of his secretiveness.

 

[PLYMCO_PILGRIM]

Let's say we eliminate ALL tax expenditures. No more mortgage interest rate deduction, no more child tax credits, etc.

This would increase revenues, certainly.

Let's say we then cut everyone's tax rate by 20 percent. If you were paying 33%, you now pay 26.4%.

The question then becomes, will you be paying more or less of your income to the federal government than you do now?

That question can only be answered by asking if you currently get more tax expenditures than you would get from a 20 percent cut.

Independent analysis has shown that the middle and lower incomes currently get more tax expenditures than they would get from a 20 percent cut, while the reverse is true for the wealthiest Americans.

So the rich would end up better off, and everyone else would end up worse off, tax-wise.

However, if we eliminate the mortgage interest tax deduction, the prices of houses would drop dramatically, thereby making them more accessible.

The mortgage interest tax deduction is an extremely regressive tax deduction.


There are lots of angles to consider. Not just looking only at the final tab on your tax bill. You also have to examine the consequences of tax reform, such as the drop in the prices of houses example.

But...the odds of Congress going along with eliminating the extremely popular mortgage interest rate deduction is a long shot to say the least. Americans just don't understand anything involving more than two moving parts.

So this means our collective stupidity would result in getting most of the downside and very little of the positive consequences.

Still, it should be done. We need some serious leadership on this. It must be done.

Too bad Mitt sucks at communication. He really, really, really sucks at it.

I think he sucks at math, too. More than he sucks at communication.

Do you have links to the data used in the independant studies? Maybe I've got it wrong, i'm willing to double check the facts and re-evaluate my position if you can provide me the sources.

Me personally, I make ~$40,000/year and the 20% cut will make it so I save 6,000 in taxes as I'm currently taxed at ~15% federally. My deductions are zero. So I'm not sure how you can say he is raising my middle class taxes but maybe he would raise other peoples this way. This is why I want the data used to come to that conclusion, I would like to see it myself so I know for a fact that what your saying is either right or wrong.

If you truly have zero deductions, you are not a typical middle class taxpayer. You have no mortgage interest rate deduction and no children.

The quote I provided a couple posts back clearly states that middle class people with kids will be hit hardest as their deductions exceed what a 20 percent tax cut would give back to them. "Thus a reform that imposed an across-the-board reduction in tax expenditures would increase taxes much more on families with children than on childless adults.”


That is a quote from the Tax Policy Center study which is the independent analysis to which I was referring, and which is the topic of this thread.

I could deduct my mortgage interest but i use the 1040ez because I'm lazy. Dependent children aren't "deductions" they are "credits" and romney's plan doesn't impact the "deductions/credits" for kids from everything i've read on it so far (please provide me facts that counter this if you have them).

Even IF i did deduct my mortgage it would still be cheaper for me to get the 15% reduction in my marginal rate (I can't get 20 as I don't pay 20).

The numbers from the data and romney's plan just don't back up the claim....YET.

 

[Toddsterpatriot]

Romney said his plan won't raise tax revenue.
Romney said his plan won't lower tax revenue.
Romney said his plan would be zero sum.
Romney said his plan would leave revenue unchanged.
Romney said his plan is "revenue neutral".

These are all true and mean the exact same thing.

Quit being a coward, and try to stay on topic.

you claim Roney said something... then say you never claimed he said it... it is pointed out to you that you DID in fact say it... you lie about it... I call you... and somehow I am a coward?

You're pathetic.

heh heh Anything to not talk about the topic huh?

Funny.

The topic? Where are the jobs, Barry?
Thanks for the additional $5 trillion plus added to the deficit.
What's up with slowing GDP growth?
Why do we have fewer jobs than the day you took office?

Is that better? Is that more on topic? LOL!

 

[Toddsterpatriot]

Revenue Neutral = Zero Sum

Does that work for you?

So he didn't actually say zero sum.
Thanks for your belated honesty.

When all else fails, play semantics games!

When all else fails, fabricate a quote.

 

[DontBeStupid]

How does having unemployed people get a job and start paying taxes count as a tax increase? How does more business startups count as a tax increase? How does overseas companies opening operations here, to take advantage of lower corporate rates, count as a tax increase? You tell me.

And how does Romney's plan accomplish that?

Cutting each bracket by 20% and cutting corporate rates to 25% is a good start.

So you cut taxes on the profits of companies? Big deal. They will simply save more of their profits in cash. They have zero incentive to put those profits into wages or inventory. Same with cutting taxes. People, especially wealthy ones, have no incentive to spend it and drive up demand. In fact, if they pull a Romney, they'll store it off shore and spend it abroad. Neither will help our economy.

 

[freedombecki]

you claim Roney said something... then say you never claimed he said it... it is pointed out to you that you DID in fact say it... you lie about it... I call you... and somehow I am a coward?

You're pathetic.

heh heh Anything to not talk about the topic huh?

Funny.

why talk abouit the tpoic wioth someone who liesw about their posts? It's pointless. Like your existence.

Aw, come on Conservative. Reading this thread and seeing Toddsterpatriot mop the floor with one dingaling denial after another ... totally priceless!

 

[Toddsterpatriot]

Interesting read.

After Bush Tax Cuts, Payments By Wealthy Actually Increased - Forbes

Their tax payments did not increase because they were taxed less. That is common sense, and only a simpleton would imply that is the case.

Their tax payments increased because the stock market boomed. The top one percent own 38.3 percent of all privately held stock.

The Dow went from 8601 in January 2003 to a peak of 14164 in October 2007. And that churn is why revenues increased.

That's why we see tax revenues plunge in Table 1 in your link for the years 2008 to present with no change in the tax margins. The Dow plunged from 14164 to 6626, and the churn has been substantially lower since. The rise in the Dow since the crash has been one of much lower volumes in trading.

We see the tax revenues slowly climbing back as the economy slowly climbs back.

Their tax payments did not increase because they were taxed less. That is common sense, and only a simpleton would imply that is the case.

Their tax payments increased because the stock market boomed.

That would explain why capital gains revenue increased. That wouldn't explain why income tax revenue increased.

According to the Forbes article, top 1% tax paid went from $256 billion in 2003 to $451 billion in 2007. According to this WSJ article....

Review & Outlook: Obama's Revenue Soup - WSJ.com

over the same period, total capital gains tax receipts went from $51.3 billion to $137.1 billion.

Only a simpleton implies that $85.8 billion, not all paid by the 1%, equals $195 billion.

 

[edthecynic]

What is this mythical middle class tax hike you claim Romeny has proposed?

Again as has already been pointed out, limiting deductions and exemptions hikes the amount of taxes you pay, by making more of your income subject to taxation. Those parts of your income that were exempt from income taxes will now be taxable.

[ame=http://www.youtube.com/watch?v=WsTIIjKsmZU]Romney: My tax plan can't be scored - YouTube[/ame]

ROMNEY: What I say is we’re going to cut the top marginal rate across-the-board by 20 percent, and at the same time, we’re going to limit deductions and exemptions to pay for most of that and then additional growth will pay for the rest of that such that our plan does not increase the deficit.

I see where you and I are having trouble seeing eye to eye on this issue and it was Romney's own fault.

He plans to cut the marginal rate for everyone by 20%, you can see it right in his plan on his website. Either he misspoke in the interview condsidering he has also said 20% across the board in other places and his actual plan on his website says " •Make permanent, across-the-board 20 percent cut in marginal rates" Tax

I understand how you got the wrong idea now.

Ok, now the study used a 20% tax cut for all income levels and an impossibly high growth rate as one of its models and it still came out that the top earners over $200,000 came out ahead paying less taxes and everyone else below came out paying more taxes. It would actually take a growth rate of 6.5% for 5 years for his tax cuts not to add to the deficit and the greatest 5 year post war growth rate we've ever had was 5.8%

Tax Reform

Our major conclusion is that a revenue-neutral individual income tax change that incorporates the features Governor Romney has proposed – including reducing marginal tax rates substantially, eliminating the individual alternative minimum tax (AMT) and maintaining all tax breaks for saving and investment – would provide large tax cuts to high-income households, and increase the tax burdens on middle- and/or lower-income taxpayers. This is true even when we bias our assumptions about which and whose tax expenditures are reduced to make the resulting tax system as progressive as possible. For instance, even when we assume that tax breaks – like the charitable deduction, mortgage interest deduction, and the exclusion for health insurance – are completely eliminated for higher-income households first, and only then reduced as necessary for other households to achieve overall revenue-neutrality– the net effect of the plan would be a tax cut for high-income households coupled with a tax increase for middle-income households.

In addition, we also assess whether these results hold if we assume that revenue reductions are partially offset by higher economic growth. Although reasonable models would show that these tax changes would have little effect on growth, we show that even with implausibly large growth effects, revenue neutrality would still require large reductions in tax expenditures and would likely result in a net tax increase for lower- and middle-income households and tax cuts for high-income households.

 

[Toddsterpatriot]

And how does Romney's plan accomplish that?

Cutting each bracket by 20% and cutting corporate rates to 25% is a good start.

So you cut taxes on the profits of companies? Big deal. They will simply save more of their profits in cash. They have zero incentive to put those profits into wages or inventory. Same with cutting taxes. People, especially wealthy ones, have no incentive to spend it and drive up demand. In fact, if they pull a Romney, they'll store it off shore and spend it abroad. Neither will help our economy.

So you cut taxes on the profits of companies?

Yes.

Big deal.

When you have the highest corporate tax rate in the world, yes, cutting it would be a big deal.

They will simply save more of their profits in cash.

And have a bigger incentive to make more. And to not move a factory overseas.

They have zero incentive to put those profits into wages or inventory.

Their incentive is higher after-tax returns on investment.

Same with cutting taxes. People, especially wealthy ones, have no incentive to spend it and drive up demand.

I don't want them to "spend it and drive up demand", I want them to invest it and drive up employment.

In fact, if they pull a Romney, they'll store it off shore and spend it abroad.

Raise their tax rate and see how fast the money moves offshore.

 

[Toddsterpatriot]

Let's say we eliminate ALL tax expenditures. No more mortgage interest rate deduction, no more child tax credits, etc.

This would increase revenues, certainly.

Let's say we then cut everyone's tax rate by 20 percent. If you were paying 33%, you now pay 26.4%.

The question then becomes, will you be paying more or less of your income to the federal government than you do now?

That question can only be answered by asking if you currently get more tax expenditures than you would get from a 20 percent cut.

Independent analysis has shown that the middle and lower incomes currently get more tax expenditures than they would get from a 20 percent cut, while the reverse is true for the wealthiest Americans.

So the rich would end up better off, and everyone else would end up worse off, tax-wise.

However, if we eliminate the mortgage interest tax deduction, the prices of houses would drop dramatically, thereby making them more accessible.

The mortgage interest tax deduction is an extremely regressive tax deduction.


There are lots of angles to consider. Not just looking only at the final tab on your tax bill. You also have to examine the consequences of tax reform, such as the drop in the prices of houses example.

But...the odds of Congress going along with eliminating the extremely popular mortgage interest rate deduction is a long shot to say the least. Americans just don't understand anything involving more than two moving parts.

So this means our collective stupidity would result in getting most of the downside and very little of the positive consequences.

Still, it should be done. We need some serious leadership on this. It must be done.

Too bad Mitt sucks at communication. He really, really, really sucks at it.

I think he sucks at math, too. More than he sucks at communication.

Do you have links to the data used in the independant studies? Maybe I've got it wrong, i'm willing to double check the facts and re-evaluate my position if you can provide me the sources.

Me personally, I make ~$40,000/year and the 20% cut will make it so I save 6,000 in taxes as I'm currently taxed at ~15% federally. My deductions are zero. So I'm not sure how you can say he is raising my middle class taxes but maybe he would raise other peoples this way. This is why I want the data used to come to that conclusion, I would like to see it myself so I know for a fact that what your saying is either right or wrong.

Me personally, I make ~$40,000/year and the 20% cut will make it so I save 6,000 in taxes as I'm currently taxed at ~15% federally.

No. The 20% cut means the 15% rate drops to 12%, not to zero.
The 35% rate would drop to 28%, not to 15%.

 

[DontBeStupid]

So you cut taxes on the profits of companies?

Yes.

Big deal.

When you have the highest corporate tax rate in the world, yes, cutting it would be a big deal.

Tax rate, sure, but look at what companies ACTUALLY pay. We have major companies paying $0 in taxes. Cutting their rate will do nothing. In fact, even though corporate profits are at records highs, corporate taxes are at record lows.

Corporate Tax Revenues Nearing Historic Lows As A Percentage Of GDP, Report Says

And you want them lower? That's moronic.

They will simply save more of their profits in cash.

And have a bigger incentive to make more. And to not move a factory overseas.

Moving a factory overseas purely due to a tax rate on paper is the worst business move imaginable.

They have zero incentive to put those profits into wages or inventory.

Their incentive is higher after-tax returns on investment.

This, is an awesome comment. I love it. Really. You think businesses are NOT trying to maximize profits right now. Fantastic.

Same with cutting taxes. People, especially wealthy ones, have no incentive to spend it and drive up demand.

I don't want them to "spend it and drive up demand", I want them to invest it and drive up employment.

Fail. Pure fail. "Investing" will not drive up employment. If you invest and build a factory and have no demand for your product, you're toast. Demand is everything. Demand is what drives the economy. If you think otherwise, you're a fool.

In fact, if they pull a Romney, they'll store it off shore and spend it abroad.

Raise their tax rate and see how fast the money moves offshore.

Raise their tax rate and see how quickly they invest it and use it for employment. Like they did in 50s and 60s.

 

[Toddsterpatriot]

So you cut taxes on the profits of companies?

Yes.

Big deal.

When you have the highest corporate tax rate in the world, yes, cutting it would be a big deal.

Tax rate, sure, but look at what companies ACTUALLY pay. We have major companies paying $0 in taxes. Cutting their rate will do nothing. In fact, even though corporate profits are at records highs, corporate taxes are at record lows.

Corporate Tax Revenues Nearing Historic Lows As A Percentage Of GDP, Report Says

And you want them lower? That's moronic.

They will simply save more of their profits in cash.

And have a bigger incentive to make more. And to not move a factory overseas.

Moving a factory overseas purely due to a tax rate on paper is the worst business move imaginable.


This, is an awesome comment. I love it. Really. You think businesses are NOT trying to maximize profits right now. Fantastic.

Same with cutting taxes. People, especially wealthy ones, have no incentive to spend it and drive up demand.

I don't want them to "spend it and drive up demand", I want them to invest it and drive up employment.

Fail. Pure fail. "Investing" will not drive up employment. If you invest and build a factory and have no demand for your product, you're toast. Demand is everything. Demand is what drives the economy. If you think otherwise, you're a fool.

In fact, if they pull a Romney, they'll store it off shore and spend it abroad.

Raise their tax rate and see how fast the money moves offshore.

Raise their tax rate and see how quickly they invest it and use it for employment. Like they did in 50s and 60s.

Tax rate, sure, but look at what companies ACTUALLY pay. We have major companies paying $0 in taxes. Cutting their rate will do nothing.

Sounds like we need to lower the rate and broaden the base.

Moving a factory overseas purely due to a tax rate on paper is the worst business move imaginable.

I know, Ireland didn't benefit at all when they slashed their corporate rate.

This, is an awesome comment. I love it. Really. You think businesses are NOT trying to maximize profits right now. Fantastic.

Do you really think that the after tax rate of return doesn't influence corporate behavior?
Awesome! Raise the rate to 90%, what could go wrong?

Fail. Pure fail. "Investing" will not drive up employment.

OMG! Were you dropped on your head as a child?
Or is your brain damage of a more recent vintage?

Raise their tax rate and see how quickly they invest it and use it for employment. Like they did in 50s and 60s.

Yes, the higher the rate, the more investment.

 

[freedombecki]

There's a lot of smarm out there about classifying people as to rich, but only if the person is a Republican. Nothing is said about the many "rich" Democrats. Nothing.

Which begs the question - why the grossly negligent unfairness? It has been demonstrated by Toddsterpatriot, and others that investment of profits brings jobs.

Tearing investors from limb to limb over paying all the taxes is not a good idea. Instead of forcing job givers to bear the brunt of political ambition, why don't politicians balance the budget and ensure that they will not be shilling for pork barrels any more.

It's the right thing to do. Let businesses do what they're good at without the impediment of government intervention and interference. American businesses are the base of our free society. Bless 'em and keep 'em.

And that's what I think.

 

[Conservative]

i still find it hilarious that libtards used to be all gung ho about closing loopholes and limiting deductions/exemptions... but now that Romney wants to do exactly that, suddenly the libtards position has 'evolved'

 

[ConservaDerrps]

I thought Conservatives said raising taxes on ANYONE during a recession is a bad thing. So how come they're okay with it if it's the working class that has their taxes raised?