If tax rates expire Palm Beacher's won't have nearly as much to complain about as their servants
By Dian Vujovich
Let me see if I’ve got this right: On Saturday, the Senate blocked a vote to extend the Bush-era income tax rates. Apparently, the primary reason was two-fold: The spoiled brat behavior of one group of Congress people who have openly vowed not to go along with anything the President of the United States suggests, period. And, because what was being proposed didn’t include all tax brackets—passing it would have increased the highest rate.
For the record, I’m not sure which is the correct order of those two points. But one thing is certain, while the wealthy may be complaining and concerned about a higher tax bracket it is their hired help, and lower income households, who would be hit the hardest.
Before going forward, a little history reminder. The law W passed in 2001 that changed our tax brackets was done because he wanted to spur our economy and promote growth in it. Hum
It was named the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) and one might say about as much spurring and growing of our economy went on during his years as President as the number of weapons of mass destruction found during the war he waged.
But put EGTRRA’s impact aside, keeping any of W’s tax rates in effect is going to cost us— as in the amount of revenues received from taxpayers to run our government. That’s important to consider. But let’s not look at it right now. Instead, let’s just do some simple math.
The tax rates we’ve been using since W signed the Act range from a low of 10 percent to 36 percent with intermediate stops along the way up to that highest bracket.
Allowing W’s tax bracket rates to go kaput means a change in rates. The biggest increase in that change, however, isn’t the one impacting the wealthy. The highest tax rate would jump from 36 to 39.6 percent. That’s only an increase of 10 percent.
I write “only” because it’s the little gal and gal who would really get sucker-punched in the deal.
How’s that? Like this: The biggest hike in tax rates hits the poorest of American’s because the lowest income tax rate would jump from 10 percent to 15 percent. That’s a 50 percent increase! Do the math.
That’s absolutely crazy. Why would the people whose income qualifies them to fall into the lowest tax bracket have to pay the highest percent of their income to Uncle Sam?
It’s looking more and more as though the individuals we’ve elected to represent us in Washington can’t do simple math. Or if they can, must have a thing against the unrich and get off on punishing that group for being, well, unrich.
If the current tax rates aren’t extended, better be careful how you tell the hired help you are W2ing.
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