Interesting poll. 4 in 5 feel tax cuts help 'someone else' Associated Press WASHINGTON - Four in five Americans in an Associated Press poll say they feel that tax cuts generally benefit someone else, a sentiment they hold even after 86 million tax rebate checks worth almost $40 billion were mailed last year by the Bush administration. A substantial majority, 72 percent, also said they would vote for a congressional candidate who supports a balanced budget over one who prefers tax cuts, according to the poll conducted for the AP by ICR of Media, Pa., a few weeks before the annual mid-April deadline for filing taxes. "I don't think tax cuts are helping any of us very much," said Betty Perry, a 75-year-old retiree from Spokane, Wash. "I don't know if we ever see them." The number who said tax cuts generally benefit somebody else, 80 percent, is higher than the 61 percent who said in a September 2000 survey that they felt that way about "targeted tax cuts." During the presidential campaign, George W. Bush repeatedly said tax cuts should include everyone, and the administration worked hard to draw the public's attention to last year's mailing of tax rebate checks. The public also is decidedly more sympathetic to congressional candidates who place a higher priority on balancing the budget than they do on cutting taxes -- with three-fourths preferring the budget-balancers and only a fourth supporting the tax-cutters. "As the (baby) boomers get toward their older years, Social Security and Medicare are going to become more important to us," said Dave Tipple, 52, a graphic designer from Columbus, Ohio. "If we keep deficit spending, it will put all that in jeopardy." Congressional leaders apparently are aware of public sentiment on the issue. GOP leaders expressed worries this winter about the reaction of voters in November if lawmakers do not pass a balanced budget. Both parties are looking for approaches that would balance the budget, while dealing with numerous spending pressures. A year ago, a third of Americans thought their taxes would not go down at all as a result of the tax cuts proposed by President Bush. More than half say now their taxes will not go down at all even after Congress passed tax cuts. The telephone poll of 1,008 adults was taken March 22-26 and has an error margin of plus or minus 3 percentage points. Half the Republicans say they expect their taxes to go down, while a third of Democrats and about four in 10 independents feel that way. Republicans were three times as likely as Democrats -- by 27 percent to 8 percent -- to say tax cuts were aimed more at them and not someone else. Just over one in 10 independents felt that way. "They're going in the right direction if they're cutting taxes," said 42-year-old Monique Maddox, an insurance agent from Cumming, Ga., who usually votes Republican. "If it's a true tax cut, it would help people." Lee Long, a 29-year-old highway department worker from Sparta, Mo., said he wants politicians to strike a balance between cutting taxes and balancing the budget. "I think they've got to do both," he said. "They've got to keep the budget in balance, but they've got to help the people now and then." Six in 10 expect to get a tax refund this year, about the same number who expected one in AP polls in recent years. Additionally, just over half said they were unwilling to give up deductions to simplify the tax system, while a third were willing to give up some. About six in 10 adults from ages 18 to 44 were willing to give up deductions, while just over four in 10 adults over 45 were willing to make the trade-off. "I would trade some deductions if they gave me the option," said Tipple, the Ohio graphic designer. "A flat tax would be the best thing that ever happened." Despite efforts to give everyone a stake in tax cuts, the public apparently still has doubts about who's getting the most help, the poll suggests. According to Christina Ledbetter, a retiree from Franklin, N.C.: "There always seems like there is a loophole for people who really don't need the tax cut."
I actually feel that they are helping me, I'm getting an extra $100 or so a month since the first of the year. However, I'd be very happy and satisfied if the cuts had never gone into place, or they take them away now, as long as people who could really use the extra money got it.
I would love to see Congress get a real budget and to give up on entitlements. I would love to see us go to a VAT tax of 17% like Dick Army suggested. At least that is a voluntary tax, and does not effect essentials like Food and clothing. But then that would require some foreward thinking politicians and there just aren't enough of them around these days. DaDakota PS. I think the tax cuts benefited my family.
Personally, the tax cuts didn't help me at all. I wonder sometimes about the VAT tax. I could see that it would be relatively fair because you pay tax on whatever you purchase, but what about services? Would every service require that you pay tax as well? Do you pay tax for a doctor's checkup or tax on labor for home repair or car repair? Would you pay tax if you bought something used from an individual? How could you possibly track it? It seems that a VAT tax would be particularly hard on poor people. Clothing and food exemptions are fine but what about doctor visits or transportation costs? What about taxes on day care or books for school or rent? For those of us who could afford a 17 percent sales tax, I can see it. But, what if you can barely afford 8.25 percent? What if your refund check is the only way you can afford a down payment on a used car? If you start adding taxes to things like healthcare, books, transportation and rent, you may be making the problems for people worse rather than better. Also, would you charge taxes on a corporate merger? Could a company circumvent the taxes they'd have to pay for say, legal services, by hiring an attorney? If they did, wouldn't that have an adverse effect on federal, state and local budgets? Would you pay taxes when you bought shares in a company - that is a commodity afterall. Just a lot of questions to answer.
VAT are great in theory, but not very realistic or easy to implement in practice. The tax rates would have to be pretty steep, I think, to make it work. Europe and other places have national VAT, but I think they also have income taxes. If you want to reform and lower individual tax rates, I think one place to start is dismantling what is now known as "corporate welfare". That would actually, in effect, be a small VAT, because those companies would pass on the costs to consumers.
Anybody who doesn't like the extra money they receive from tax cuts can send that money directly to me. Anobody who is not getting extra money either doesn't pay taxes or needs a better accountant.
This always reminds me of a debate I had with a guy once. He told me what a staunch supporter of the flat tax he was and went on and on about how we should take out all the deductions and just have everyone pay a flat percentage of whatever they bring in during the year. For some reason, talk turned to the Home Interest Deduction, and suddenly this guy wasn't so staunchly for the flat tax anymore. He went into a long bit about how keeping the home interest deduction was vital to the well being of the country and so on and so forth. So essentially, the guy was for the flat tax for everyone else's deductions. But when it came to cutting out his big deduction, he could somehow justify how his should be kept while others are taken away (at that point, I should've said something like "Don't you think everyone could come up with a very well-reasoned defense of whatever deductions they take?", but I was tired of the whole thing by then). And there are loopholes that get individuals who should not be paying taxes in any given year but have to under the alternative minimum tax (including folks who did not receive cash, but rather stock options -- stock options that could be worthless now, by the by. Still gotta pay taxes on 'em, though, in some cases). I hate this whole attitude anyway. What difference does it make to me if someone else gets a credit or break for whatever they get a credit or break for? It all stems from a perception that companies and wealthy individuals pay little or no taxes (which is untrue) rather than from an actual accounting of who does and doesn't pay taxes. Is the system perfect? Of course not. But it sure seems like the average person has a tremendously warped sense of the income tax system and what people and companies do and don't pay. From what I've seen, people generally think companies and wealthy people pay a lot less taxes than they actually do.
Also going back to that last quote I quoted, I would question the idea of "need" in terms of tax cuts and whether need should enter into it at all. A company may well be able to afford to pay all the taxes it does. It could possibly even afford more. But for every dollar that company doesn't pay, that may well be a dollar they put into expanding their business or hiring another worker or not raising the price of their product, thereby allowing more people to buy it... and so on. So sure, they may not need a tax cut in the truest sense of the word. But it may well be better for the country if they get that tax cut. It's just like with anything else. A company may well could afford to pay 20% interest on its loans, but if it pays 6% instead, perhaps they can expand faster and create more growth and jobs and whatever. They don't "need" the rate to be as low as 6% to survive, but it's a lot better for everyone if they pay that instead of the 20%. It just always seems like people aren't happy with what they have or what they could accomplish or what they get. They aren't happy unless they are brining someone else down. You could give them $1,000, but they'd be angry that someone else got $5,000.
I wonder how many of the, 4 in 5, people would be willing to give the rebates back. How about 0 in 5? Whiners. I personally, would prefer the VAT tax. However, the most fair thing to do, would be to have a flat tax (I'd like a 10% personal income tax) on both personal & business income, with zero deductions. You'd also need to have a point, for personal income, where you didn't have to pay taxes. In other words, anyone that makes $12,000 or less a year, would be tax free. Now, $12,000 wouldn't necessarily be the cut off point, but what ever point was decided upon, it should be a firm number that wouldn't change, no matter how many family members you have. If someone has too many children to feed, then set up special assistance programs for them. Businesses should also have a flat tax (albeit, higher than personal taxes), with the only deduction being on the number of new jobs created for the year. In other words, how many new jobs the company created over the most it's ever had. If they had 1,000 employees & laid off 200 this year, then hired 300 the next, they would get a deduction for creating 100 new jobs. The next deduction would come when they went over 1,100 employees. You'd probably have to put penalties in, to prevent companies from hiring a bunch of people for the deduction & then turning around & laying them off. There should be a minimum amount of time, before the company could drop below the total number of employees & still get the deduction. Somewhere between 6-12 months.
In the UK we have 20% income tax (you don't pay on the first £4,000 or so but it is graduated up to 40% for high earners). We also have 17.5% VAT. Income tax is, by a mile, the fairer tax.
Certainly the Enron debacle has shaken faith in corporations paying their share of taxes. How pervasive the other Fortune 500 use international tax shelters and such I have no idea. Also, the very very rich do set up trusts and foundations with various fronts to avoid taxes. No one "likes" to pay taxes--most people want others to may more and them to pay less. But most people like having good public and higher education, safe streets, being protected from foreign invasion, getting cheap oil, having gradma's health and house bills covered, and getting future cancer treatments approaches funded. So of you may think government shouldn’t be involved in most of this—and you would be a small minority. My main peev with taxes is that part that goes for interest and not other kinds of services or expenditures. I was wondering if you could do the opposite--save so much money so that a surplus invested could in part pay for future government expenditures. I think Switzerland is kind of in this boat, but in talking with people somewhat in the know they think it really isn't feasible for an economy/government of our scale. ( 1. An argument like there wouldn't be anyone of size--citizens, foreign citizens/countries-- to pay back interest on our government surplus so to speak or 2. an argument where this would put government too involved in the markets and threaten basic elements to the market practices that created our grand economy). So maybe we can't go this route, but at least we could keep our debt to a minimal figure.
The tax cut hasn't even gone into effect fully yet. How do you know if it will help you or not?? All we've really experienced so far was the refund check...The rates get progressively better over time. Jury is still out...ask these people this question after 5 years. Better yet...outlaw withholding and make everyone write a check at the end of the year to the IRS (or quarterly payments)....then people get to actually see how much they pay in taxes. It's funny how people say, "I didn't pay taxes this year!" when they get a refund!! Ummmm...no....you paid!
I don't see much purpose in that MadMax, how hard is it to look down in Box 13 or whatever on a W2 and see how much you paid in taxes? I think given the current climate, it would be more informative if people got a list of all things the government pays for including Aunt Martha's medical bills, Grandpa Joe's weekly check, and nephew Johnny's subsidized student loans. In short I think people are far more aware of what they pay in taxes than they are of the services they receive--including most immediate benifits (social security, medicare) and hard to see benifits (having a military to protect individual's assets from foregn invasion and keeping oil cheap, having a SEC commision to try keep the market open and fair, funding medical advancements that otherwise would occur because pay offs are so delayed, having roads and national parks, etc, etc..
Value Added is a regressive tax, meaning it takes a greater percentage of a poor person's income than a wealthy person's income. I don't see how that's helpful to society or the economy. With a progressive tax like the FIT, you tax the people who can afford the tax more. For the same reason, I can't buy the flat tax. At least the flat tax is even on a % basis, so it's better than the VAT. But if you reduce the percentage of income tax taken from the top 1% or whatever of the country, you must increase the percentage taken from the rest of us. The only benefit I can see to a flat tax is closing the loopholes that have crept into the tax code over the years.
Owning a business dramatically changes the structure of how you deal with taxes. I never get anything back but I usually don't pay anything either. So, for me, it's all about the money I pay my CPA every year. Or it may just hide as much income as possible so it can get a giant refund to line the pockets of its board members like Enron did. Hottodie: So 80 percent of Americans are whiners for not thinking the tax cuts effect them but we aren't for complaining about our taxes being too high? It's an interesting debate. I wonder, how many people actually think about the taxes they pay every year. Max suggests that we should pay quarterly or yearly taxes to feel the burden. Anyone who owns a home or owns a business and feels like they will have a significan tax burden at the end of the year does, but does anyone really sit around during the day stewing over their income taxes? My father-in-law is a financial genius. He takes no deductions and never complains about his taxes though I'm betting he pays more every year than most of us put together. It's an interesting thing to worry over.
The tax cuts have helped me bigtime. I ate nothing but Ramen for the last week in November. I've only ate Ramen three times this year and I attribute about a third of my extra funds to the tax cuts. I believe in paying taxes to support the stuff Scar mentioned, but there are only about 10-15 things (rough guess) the federal government does that are a higher priority than not eating Ramen on a daily basis.
I personally, would prefer the VAT tax. However, the most fair thing to do, would be to have a flat tax (I'd like a 10% personal income tax) on both personal & business income, with zero deductions. You'd also need to have a point, for personal income, where you didn't have to pay taxes. In other words, anyone that makes $12,000 or less a year, would be tax free. Now, $12,000 wouldn't necessarily be the cut off point, but what ever point was decided upon, it should be a firm number that wouldn't change, no matter how many family members you have. If someone has too many children to feed, then set up special assistance programs for them. Beyond the fact that a VAT or Flat tax is really a regressive tax in terms of real-income (poor people pay a larger portion of real disposable income), there are a number of other problems with the tax. For example, our government uses tax incentives as an alternative to spending programs. The economic empowerment zones that Clinton started (or whatever they were called) basically gave tax breaks for development in run-down neighborhoods. Or, the education tax credits help drive people towards college. Those are all very positive incentives that are much simpler (and cheaper) than starting new government programs to accomplish the same things. Can't do things that like anymore with a VAT tax. Still could with a flat tax, but it really wouldn't be flat anymore.
