Bush Tax Cuts Heavily Favor Rich, CBO Says -Reports Fri Aug 13, 2004 03:01 AM ET NEW YORK (Reuters) - President Bush's tax cuts have transferred the federal tax burden from the richest Americans to middle-class families, with one-third of them benefiting people with the top 1 percent of income, according to a government report cited in newspapers on Friday. The Congressional Budget Office report, to be released Friday, is likely to fuel the debate over the cuts between Bush and his Democratic challenger in November, John Kerry. The report said the top 1 percent, with incomes averaging $1.2 million per year, will receive an average $78,460 tax cut this year, and have seen their share of the total tax burden fall roughly 2 percentage points to 20.1 percent, according to The New York Times. In contrast, households in the middle 20 percent, with incomes averaging $57,000 per year, will receive an average cut of only $1,090, the newspaper said, citing the CBO report. Taxpayers whose incomes range from $51,500 to around $75,600, saw their share of federal tax payments increase, according to CBO figures cited by The Washington Post. The calculations, requested by congressional Democrats, confirm the long-held view by independent tax analysts that the tax cuts, enacted in 2001 and 2003, have heavily favored the wealthiest taxpayers, the Times said. Bush has said the cuts provided crucial support to the U.S. economy after the Sept. 11 attacks and the three-year decline in U.S. stocks. But Kerry, who wants to roll back the cuts for households whose incomes top $200,000 per year, has said the cuts did little for the economy, and helped cause the federal budget to swing from a more than $100 billion surplus in 2001 to a projected deficit exceeding $400 billion this year. The newspapers, citing the CBO report, said about two-thirds of the benefits from the cuts went to households in the top 20 percent, with an average income of $203,740. People in the lowest 20 percent of earnings, which averaged $16,620, saw their effective tax rate fall to 5.2 percent from 6.7 percent, though their average tax cut was only $250. http://www.reuters.com/newsArticle.jhtml?type=topNews&storyID=5966738&src=rss/topNews§ion=news
How has the tax burden shifted since the Bush tax cuts? The Congressional Budget Office just released these figures -- the percentage change in the tax burden by average income: $1,100,000: -2.1% $182,700: -0.9% $75,600: +0.8% $51,500: +0.2% $34,200: -0.1% $14,900: -0.1% "...by far the vast majority of my tax cuts go to the bottom end of the spectrum." -GWB 2/15/00
Chump, I assume that these are the mid-points of an income range? Any more details? Man, the largest jump, the only jump, in the tax burden falls squarely on the middle class. I find the fixation with the "tax cuts" for the wealthy, by our middle class Republican friends here, similar to the fixation Southern white working class folks had with slavery... "Hell no, I can't afford one but, by golly, I'll defend to the death my right to own a slave if I ever make enough money!" Yes, I know the Civil War was primarily a fight over states rights, but I still think the analogy is a good one. What in the heck are you Republicans excited about when it comes to George W. Bush and his tax cuts? It ain't doin' ya much good, people. Not much good at all. And Kerry isn't going to take away the middle class cuts... if for no other reason than that Democrats won't let him! And he promised not to. I think I'll take his word on that at face value. I didn't hear him say, "Read my lips!"
Numbers can look any way you want them to. Everyone who made the same amount of money and paid Federal taxes received a tax break under George W. Bush's Tax Plan.
If you actually look at the numbers, they say that the middle class got a net tax INCREASE while the upper income folks got an average 2% DECREASE. How in hell are you going to try and spin that?
I'm in that range. The last two years I've paid an average of $2100 more in taxes. In the last 10 years (except for getting married in 1997) I've never changed my filing status. Before 2002 I always got a refund.
The second statement is irrelevant to your tax rate. The fact that you overestimated your taxes and withheld more than necessary and, therefore, received a refund of the amount paid in excess of your tax liability doesn't have any real bearing on how much you actually pay in taxes. That said, the first part is not good. If anyone wants to look at the actual report, it's online at the CBO's website: http://www.cbo.gov/showdoc.cfm?index=5746&sequence=0
There's not spin to it look at actual dollars paid. Everyone whp paid Federal Taxes and made teh same amount of money paid less unless the Bush tax cuts. You can do your standard deviation or percentage of sum or whatever other means you want to, bottom line is everyone paid less.
Now what changed in your income? Did you make more, have less withheld, have a not operating loss carryforward. or become self-employed?
No, that is obviously not the bottom line. I didn't pay less. I got exactly ZERO cut in my taxes until my son was born and that "cut" had nothing to do with Bush. The numbers don't lie and the numbers say that the rich got a reduction of 2% while the middle class saw their taxes rise a fraction of a percentage point. This goes along with the data from the beginning of the income tax where the rich have seen their tax rates drop by over 60% while the rest of us have seen ZERO reductions in our overall tax rate. Basically, the rich have the money to lobby the government so they are the ones who get the tax cuts.
Andy- Throw out the percentages. They are percentages of what was paid before. It's simple if the wealthiest 25% paid 85% of the taxes and a tax cut occurs accross the board then they would get around 85% of the benefit. Everyone got a tax break so teh middle class did not pay more. And I have no idea how you can argue you paid less, I'm a CPA and I will guarantee if you made the same amount of the money, made it the same way (W2 vs 1099 vs Rent, no NOL, etc Income), had the same withholdings, and had the same amount if itemized deductions (meaning you didn't sell your house or have unusual medical expenses) and you made enough to pay federal taxes that you got a tax break. If you can show something different, then your taxes were done incorrectly.
Andy to simplify when you get a chance look at your tax return for 2003 vs. 2000 or so. Just look at 2 lines: Line 40 - Taxable income Line 41 - Tax Both lines are about 1/3 the way down of the 2nd page of the 1040.
THROW OUT THE PERCENTAGES PUT OUT BY THE CONGRESSIONAL BUDGET OFFICE?!?!?! I am certain that the GOP WANTS people to do that, but when it comes down to it, those are the percentage differences between the tax rate now versus the tax rate before the cuts. The same thing has happened with virtually every tax cut since the progressive income tax was started. Since then, the wealthiest have seen their tax rate fall more than 60% and the rest of us have seen our tax burden remain the same or rise as they did when Reagan cut income taxes and increased payroll taxes. I have had exactly the same gross income since 2001 and I received exactly $0 in reduced taxes until this year, when I had a new dependant. I saw a substantial reduction then, but it was not due to the Bush tax cuts (maybe an extra $100 or so for the expanded child credit), it was due to the baby. I can't afford to buy a house and I paid a substantial amount of income taxes. You can make your claims over and over again, but it does not change the fact that I got ZERO tax cut in '01 and '02 and only got money back for '03 because of the baby. You may want to throw out the percentages, but you simply cannot do that without willfully sticking your head in the sand. Is it fair that the rich have seen their taxes slashed by over 60% since the income tax started while the middle class has seen NO reduction in tax rates since then?
BTW, because of the Bush tax cuts, I have also seen my tuition raised (since Texas got less money from the Fed and they slashed higher education funding by 25%) and have had my benefits decreased (for the same reason, I work for a college) even though my out of pocket costs for those benefits increased. The Bush tax cuts have been a disaster for me and my family and that doesn't even BEGIN to talk about how bad they will be for the country in the form of deficits as far as the eye can see.
but a tax cut did NOT occur "across the board", so your model is wrong as it relates to the real world by "favored", we're talking about the wealthiest and most able to pay recieving a higher proportion of the cut than what they contribute, so their overall tax burden is reduced. The middle class folks now have to carry a heavier burden to offset the reduction the rich folks got. People who struggle to pay for their kids college now have to pay a higher percentage of the tax burden thanks to Bush's tax cuts. do the people making 1.2 million really need an extra $78,460 ? or would that money be better used to fight terrorism and this elective war? voo-doo economics!
