Bush's Tax Cuts: Who the WH says benefits

[Chomp]

So who do Bush's tax cuts benefit?

Here are 2 quotes from an article entitled: "Just the Facts: President Bush's Pro-Growth Tax Relief Benefits All Americans Who Pay Income Taxes", from the Settting the Record Straight section of the WH website.



http://www.whitehouse.gov/news/releases/2006/04/20060405-9.html

---Quote---

FACT: The 92.1 million taxpayers with annual incomes of less than $50,000 in 2003 saw a 47 percent reduction in their average tax bill from President Bush's 2001-2003 income tax relief. ("Who Benefits Most From Tax Cuts On Investment Income," The New York Times, 4/5/06)

FACT: The 26.9 million taxpayers with annual incomes between $50,000 and $100,000 in 2003 saw a 20 percent reduction in their average tax bill from President Bush's 2001-2003 income tax relief. ("Who Benefits Most From Tax Cuts On Investment Income," The New York Times, 4/5/06)

---End Quote---

(There is a table from the New York Times supporting these contentions).



These are pretty extraordinary claims: almost 100m of the poorest working Americans saw their taxes cut almost in half! (I think they are saying this is over the period '01-'03.)

Wow. Really?

Furthermore, these 2 sets of figures represent 119 million working Americans. I'm not sure what percentage that represents of the entire workforce, but it must be a very large majority. And all of them got tax cuts of between 20% and 47%.

Wow. Really?



Erm...Is any of this correct??

[Finder]

1. Many I know that make under 30g did not see any cut.

So although the above may be factual, it is not exactly representative.

[Egalitariat]

4. There is no way your statement is true...

Unless they were paying no taxes before the tax cuts; I agree you can't cut 0%. The amount of earnings subject to the lowest two brackets increased -- which is a good thing AND the standard deductions went up.

The focus should be that the richest people got the biggest tax cuts -- not who got what at the fiscally insignificant bottom of the bracket.

[Yupster]

8. The 10 % tax bracket

would have cut this person's taxes if nothing else happened. They would pay 10 % instead of 15 %.

If they had kids, their standard deductions would have gone way up.

No brackets went up to counteract those cuts, so this person couldn't pay more.

Now they could have made more money or they could have lost their deductions, or they could have stopped contributing to their 401 (k)or other things could have happened, but if they had two normal years and made the same amount each year, their taxes would have gone down with the 10 % bracket alone.

It wouldn't be a major reduction because they wouldn't be paying much tax in the first place.

This family would probably pay way more in FICA than in income tax, and the FICA rate hasn't changed in years.

[Deja Q]

2. I make under $50k. And noticed FICA, et al, creeping up. Besides,

:shrug:

Besides, what's half the tax on $20k for those people anyway? Does it even make a dent in their expenses list?

[Yupster]

I don't think the FICA rate

has changed in years.

[Yupster]

9. I don't think the FICA rate

has changed in years.

[globalvillage]

3. Does the NYT article refers to tax on investment income only?

It would appear that it does from the title of the NYT article referenced. If the NYT is talking investment income, the WH website posting is very misleading.
Most people making $50K don't have a ton of investment income.
Or maybe they're just making it up.

More to the point:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=364x951876

[Chomp]

6. Yes, I noticed

the name of the NYT article and wondered about it too. But the WH wording is quite specific and clearly is not referring to investment income alone.

I just think that saying that 119m Americans paid between 20% and 47% less tax is either an extraordinary achievement or an extraordinary lie.

[unblock]

5. link to the nyt chart:

http://www.nytimes.com/imagepages/2006/04/05/business/tax.chart.html

notice that the investment tax gains when HUGELY to the super rich,which does change the picture quite a bit.

the under $50,000 group who, on average, was they taxes go from $909 to $435 includes a lot of the working poor who are actually getting the earned income tax credit, i.e., a negative tax. moreover, for these people who actuall have tax bills in that range, their biggest concern has never been the irs. payroll taxes have always hit this group harder. i would also note that the typical person earning close to $50,000 is paying a LOT more than $435.

one more point. while the chart shows that the benefits of the investment tax cuts are going disproportionately to the super rich, this actually UNDERSTATES the issue. due to favorable tax treatment now, those with capital gains are doing everything to realize them now, rather than spread them out over several years like they would under normal circumstances. this means that the capital gains taxes among the super rich in the next few years will be EVEN LOWER because they will realize less capital gains in those years.

[ThoughtCriminal]

7. Whitehouse.gov is OUR property

Why do we allow it being used for GOP bullshit?

[ThoughtCriminal]

10. Important - Tax bills declined for investment income from

2001-2003 because the market tanked after Bush took over - Duh!