Posted Wednesday, October 15, 2008
Senator John McCain just announced a proposal to slash capital gains taxes by fifty percent. Barack Obama says he'll cut income taxes for 95 percent of Americans. Which is best? Both candidates of course have lots of other proposals, from tax credits for health insurance to others for saving for retirement. On our program, we'll compare all of them and get some analysis on what they would mean for your family and for our country. Be sure to join us Wednesday morning at 9.
A lot of listeners called and wrote in to share their opinions about tax policy. Here are some of the emails we received:
People who want to keep the current, lower tax rate on capital gains always cite the fact that it is a tool that creates jobs. The tax cut has been in effect for several years and yet I have not heard one single statistic on the number of jobs the tax cut has created.
What it has done is create one of the widest gap between the "haves" and the "have nots" in our history.
Voters need clarification regarding Obama’s claim that he “will reduce taxes for all making less than $250,000 per year.” McCain charges that Obama’s program will lead to huge increases in taxes.
What will be the impact of a Democratic President working with a Democratic Congress to eliminate all tax cuts enacted under the Bush Administration? Is this what’s at the heart of McCain’s charge regarding greater taxes under Obama? Have the Bush Administration’s tax cuts had no value for taxpayers making less than $250,000?
With all due respect, you are repeating the same misinformation about the Bush tax cuts without looking at the facts.
From 1986-2004 the total share of the income tax burden paid by the top 1% of earners grew from 25% to 36% white the total share of the tax burden paid by the bottom half of earners fell from 6% to on 3%.
Also the percentage of income the top 1% of tax filers paid rose from 18% to 19% while the bottom fifth of tax filers paid dropped from 1% to zero.
Also, the top 1% saw their tax burden rise from 26% to 37%.
Let's be honest about the tax cuts and their effects without just repeating what the far left has been screaming about for years and not basing it on the facts.
One of your guests just made a very important point: every proposal has to go through congress. What I believe is going on is an attempt by both candidates to strip voters away from one another. Throw some sop to the elderly, something for the small business guy, something for the folks in default, something for everyone. They can talk and promise anything at this point with impunity because it's not going to happen.
My “small business” (sole proprietorship) nets about $100,000 annually. When combined with my wife’s very middle class wage, we pay about 48% of my net income to income taxes (25% Federal income, 15.3% Federal self-employment, 6% Ohio, 2% city). How can this be an acceptable system of taxation? Any help on the horizon for my family?
Bill, Willoughby Hills
I think that one simple way to frame this debate about taxes is to take note of which tax bracket each of our candidates falls in. John McCain is trying to give tax breaks to folks IN HIS OWN bracket, while Obama will be in the bracket which will be paying higher taxes under his plan. So, ask yourself -- who do you want running the country? Someone who is looking for tax breaks for himself, or someone who is willling to carry a lager burden because he has been so fortunate to be in that higher income bracket?
Karyn, Bay Village
Like many Ohioans, I am subject to AMT (Alternate Minimum Tax). Will either of the candidte's plans change the AMY?
Just checked the ElectionTax web site. It reports that Mr. Obama's program will increase my taxes more than $10,000 per year. Still, I intend to vote for him for various policy reasons including the following one.
Over the prior 8 years of Republican governance, my net worth have been diminished by 30% as a result the devaluation in the US dollar (which is associated with unfunded wars and tax rate decreases for the wealthy).
The bottom line: For me, Republican devaluation of the US dollar costs me more than prospective marginal increase in taxes.
Re: bus taxes - 35% currently - at one of the debates the issue of business taxes was brought up. McCain said that the U.S. had one of the highest if not the highest tax burden on businesses which is why businesses went out of the country with jobs. Obama responded that there were so many loopholes to the taxes that they ultimately became lower than most other countries? McCain never responded to that. Is it true?
As far as will any of the tax issues change or convince me to vote for one or the other - no. This is a one-issue election for me and this isn't the issue. But knowing how each candidate's tax policies will actually work helps me to inform others when tax issues come up.
It just occurred to me that the reduction by half in capital gains taxes for the next two years as proposed by John McCain would help his wife a lot. She is said to be a large holder of Budweiser stock, which is being bought by a Belgian company. I believe that this is supposed to occur some time early next year. If this is so, wouldn't John McCain's wife be a big beneficiary of a further reduction in capital gains taxes?
Karen, Broadview Heights
I’ve been wondering about the concept of a flat tax. It’s usually seen as favoring the wealthy, but I think I have a way around that. First, redefine income as any money coming in regardless of source – paycheck, interest, stock dividends, whatever. Money is money. Then peg the standard deduction to the federal poverty level, so it automatically adjusts every year and allows for greater deductions as family sizes increase. Corporations would be able to claim any full time employee in the US as a deduction, encouraging job growth here. What do your guests think?
Jerry, University Hts.
Isn't this just a shell game to some extent?
What the Feds give up, they cut from the States who then raise their taxes and fees or cut local subsidies so that cities then raise income and property taxes along with fees. FEES for services are the big unspoken cost, and they've skyrocketed under Bush.
Court Fees at all levels have also gone through the roof, INCLUDING BANKRUPTCY !
Could you get your guests to comment on the effect on "Small Businesses?"
As just mentioned, small business income can end up on the owner's 1040, but, to my knowledge, all of the regular business expenses are still deducted.
In other words, the business's taxes are only based on income AFTER all expenses have been deducted, including rent, health care, etc. This is far different from a "regular" person's 1040, where only a few things are deductable.
Jack, Ohio City
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