Budget Contains Middle Class Tax Increase
While there's the $1 trillion dollars the government likely won't see from allegedly taxing the rich, contrary to Obama's claims, he will eventually be taking money out of middle class pockets.
If one reads enough budget stories, it seems the rich aren't the only ones who will have their taxes raised by Obama. And middle income working Americans won't be able to get around it as the wealthy probably will. By sunsetting this provision below, workers making less than $95,000 will lose $400 bucks out of their pocket each year going forward. They know where the bulk of the money is and that's always where they invariably go to get it in the end.
The $3.8 trillion budget request rolled out by the White House on Monday would renew the Making Work Pay tax credit for fiscal 2011, but then would have it sunset.
That’s a switch from last year, when Obama’s budget called for making the tax credit permanent. The cut costs the federal government about $63 billion in annual revenue while putting up to $400 in the pockets of workers making less than $95,000. It was approved for the first time in last year’s $787 billion stimulus package.
An administration official said the tax credit reflects changing realities in Congress on climate change legislation.
I guess this could be called “Gorebal ‘Warming’ uber alles.”
An administration official said the tax credit reflects changing realities in Congress on climate change legislation.
Um, what?
“An administration official said the tax credit reflects changing realities in Congress on climate change legislation.”
Huh?
What does climate change legislation have to do with raising income taxes on the middle class?
Where do I sign a recall petition for this prick we elected?
My guess – Obama has a place holder in the budget for climate change legislation next year. It’s being touted as revenue neutral. By sunsetting this tax credit this year, he doesn’t have to do it next year. That would provide more revenue to allow the claim of the global warming bunk being revenue neutral. That’s a guess, anyway.
The change is not in the atmospheric climate. It’s in the political climate.
Dan, it’s even worse.
According to Reuters [http://news.yahoo.com/s/nm/20100201/bs_nm/us_budget_backdoortaxes ], taxes are going up across the board for everyone because the budget allows all Bush-era tax cuts to expire. It’s just another broken campaign promise, but will the media hold Obama accountable? Here are some of the details from Reuters:
“If the provisions are allowed to expire on December 31, the top-tier personal income tax rate will rise to 39.6 percent from 35 percent. But lower-income families will pay more as well: the 25 percent tax bracket will revert back to 28 percent; the 28 percent bracket will increase to 31 percent; and the 33 percent bracket will increase to 36 percent. The special 10 percent bracket is eliminated.
Investors will pay more on their earnings next year as well, with the tax on dividends jumping to 39.6 percent from 15 percent and the capital-gains tax increasing to 20 percent from 15 percent. The estate tax is eliminated this year, but it will return in 2011 — though there has been talk about reinstating the death tax sooner.
Millions of middle-class households already may be facing higher taxes in 2010 because Congress has failed to extend tax breaks that expired on January 1, most notably a “patch” that limited the impact of the alternative minimum tax. The AMT, initially designed to prevent the very rich from avoiding income taxes, was never indexed for inflation. Now the tax is affecting millions of middle-income households, but lawmakers have been reluctant to repeal it because it has become a key source of revenue.”
But wait, there’s more!
“Middle-class families also will find fewer tax breaks available to them in 2010 if other popular tax provisions are allowed to expire. Among them:
* Taxpayers who itemize will lose the option to deduct state sales-tax payments instead of state and local income taxes;
* The $250 teacher tax credit for classroom supplies;
* The tax deduction for up to $4,000 of college tuition and expenses;
* Individuals who don’t itemize will no longer be able to increase their standard deduction by up to $1,000 for property taxes paid;
* The first $2,400 of unemployment benefits are taxable, in 2009 that amount was tax-free.”
“An administration official said the tax credit reflects changing realities in Congress on climate change legislation.”
This is easy to understand.
BHO’s econ hacks (Romer, et al.) were planning on getting $X trillion from cap-and-tax. The “changing reality”, now that his peers are publicly mocking BHO for pretending that climate change is an issue, is that cap-and-tax is no longer viable legislation. So the (required) projected revenue will simply have to come out of the Taxpayers’ pockets more directly.
“What does climate change legislation have to do with raising income taxes on the middle class?”
Because Obama’s old budget assumptions included realizing about $650 billion from Cap ‘n’ Tax. That loot won’t be forthcoming now.
This is bogus. If the Obama administration proposes and signs a tax cut, and then they allow that tax cut to expire, that isn’t a tax increase. RE: “He will eventually be taking money out of middle class pockets.” Nonsense. If you say that middle class taxpayers will pay taxes, then he will be taking money out of their pockets RIGHT NOW. If you’re talking about new taxes, they don’t exist: he lowered taxes for working families, and he is going back on his promise by making it temporary. [I'm socked - SOCKED - that a politician would fail to keep his promise.]
Now, that having been said.
NealK has the real story. This budget has plenty of real tax increases that are going to hit working families. If Libertarians and Conservatives want to attack President Obama for raising taxes on working families in the middle of the worst economic crisis since the Great Depression, that is where they need to start hammering.
Let’s get real.
Reuters just pulled their story. Rahm must have made a phonecall.
“The story Backdoor taxes to hit middle class has been withdrawn. A replacement story will run later in the week.”
http://news.yahoo.com/s/nm/20100202/bs_nm/us_budget_backdoortaxes
Hello….just read the proposed Budget.
Healthcare AND Cap & Trade are both in there! This budget assumes BOTH are passed into law. The Administration is up front about Healthcare being in there but Cap & Trade is better hidden (numbers wise) but a fair amount of discussion of it is contained on Pg 30 of the Budge release.
MT raises an interesting point. The budget not only assumes that healthcare reform passes, but that it reduces the deficit as planned! LMAO! That’s right, as bad as President Obama’s budget is, there are $180B+ in **SAVINGS** created by healthcare reform. They actually believe their own lies, or they simply are piling one set of lies on top of this set of lies.
@CommonSense02 – I just saw that too. Business Insider reported the withdrawal here: http://www.businessinsider.com/reuters-takes-down-story-linked-by-drudge-report-2010-2
Quoting Business Insider:
“According to a Reuters rep, the was withdrawn ‘due to significant errors of fact.’
‘The story was wrong on multiple points and should not have gone out,’ she emailed us. A formal withdrawal will issued will address specific points that were incorrect later today.’” [Missing words/bad grammar in original]
Hmm. Another victory for those layers of editors and fact-checkers. Having not read the budget myself (because, you know, I have a job and a life), I can’t say what the “errors of fact” might have been. If the article is wrong in every material respect, then I guess that’s good, or at least not quite as bad. It would upgrade the proposed budget from brazenly, two-middle-fingers-in-your-face awful to just plain awful.
Suddenly, we’re all rich