Taxes - Bush Tax Cuts and Kerry's Agenda
Bush talks about giving money back to the people through tax cuts, in an effort to rebuild the economy. Kerry talks about taxing the rich in order to pay for national services like healthcare. Or as Kerry puts it, "make the rich pay their fair share." First, let's look at what has been done by the incumbent.
Bush, has made a some large tax cuts during his 4 years. Most critics claim these tax cuts are aimed at the rich. To understand if this claim is true, you must first understand the tax system. Federal income taxes in the US are paid based on the amount of income you make. The income is then taxed at different percentages for each bracket the IRS has defined. Those taxes can then be offset by tax deductions and tax credits, which are given based on a variety of criteria. The lowest tax brakcet during the Clinton administration was 15%. The Bush tax cuts dropped the lowest tax bracket from 15% to 10%. Since, the lowest tax bracket was changed, this obviously helps all taxpayers. However, the lowest tax bracket accounts for so little of rich wage earner's income that it is insignificant. The top tax bracket, which is the most significant for rich taxpayers moved from 38.6% to 35%. That amount is 3.6%, which is quite the 5% of the lower tax bracket. Also, the lowest tax bracket dropped by 33% overall, where the top tax bracket only changed by 9%. Most people might scoff and say that it equates to a lot less taxes paid for rich wage earners, but then they'd be overlooking the fact that by changing the lower tax brackets by so much has actually removed 7.8 million families from paying any taxes at all. You see, what was overlooked is the fact that the lower wage earners get lots of tax credits like the child tax credit which was doubled from $500 to $1000 by the Bush tax cuts. See here for more information.
Now for the shocking facts. When taxpayers go to file their 2004 taxes before April 14, 2005, 33% of them will have no tax liability. In other words, roughly 44 million taxpayers will have given the federal government no part of their income for the 2004 tax year. Hard to imagine? Then you need to learn more about who really pays taxes, and stop listening to one-liners from the media and politicians. A great site to learn more aout who is paying the taxes is the Tax Foundation.
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