Beware of tax law changes

gop.jpg That damned cowboy is president now.–Mark Hanna

Republicans may be leaning toward fair tax, flat tax or consumption tax plans. These ideas have one thing in common–they shift the tax burden from the rich to the rest of us.

Today, income taxes are progressive–taxpayers pay at higher rates on income above some limits. Accordingly, the burden of taxes in principle falls more heavily on those most able to pay. Historically, marginal tax rates–the rate on incomes above a threshold–have been more than 90 percent. Today they are much lower. An end to progressive income taxes would greatly benefit the rich and lay a heavy burden on the rest.

Beware of these:

  • Flat Tax–Rich and poor pay at the same rate regardless of income.
  • Fair Tax–Flat tax with extra benefits for the poor
  • Consumption tax–taxes on what you spend rather than what you earn.

Republicans propose to lower or eliminate business taxes further shifting the burden of taxation from the rich to the rest. Watch out for Rep. Reed to embrace one of these plans.

Republicans propose to lower or eliminate estate taxes paid only by the rich and super rich. This would accelerate the accumulation of inherited wealth by the wealthy. Donald Trump has endorsed this idea which would benefit his family greatly. Watch out for Rep. Reed to embrace one of these plans.

https://www.bna.com/tax-rewrite-players-n73014450000/

http://www.taxpolicycenter.org/statistics/historical-highest-marginal-income-tax-rates

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About whungerford

* Contributor at NewNY23rd.com where we discuss the politics, economics, and events of the New New York 23rd Congressional District (Allegany, Cattaraugus, Chautauqua, Chemung, (Eastern) Ontario, Schuyler, Seneca, Steuben,Tioga, Tompkins, and Yates Counties) Please visit and comment on whatever strikes your fancy.
This entry was posted in Reed's Views, Taxes and tagged , , , , , . Bookmark the permalink.

2 Responses to Beware of tax law changes

  1. Deb Meeker says:

    How would a consumption tax hurt the middle class and help the rich? I’m not doubting if Republicans are considering it, it’s most likely detrimental, but please elaborate on its pitfalls. Thank you.

  2. whungerford says:

    Consumption taxes are highly regressive–wealthy people generally spend only a fraction of income on goods and services.
    https://en.wikipedia.org/wiki/Consumption_tax

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