Clinton’s tax plan lowers the deficit … until you add the “and spend.” Talk about a complex tax system, and by the way more Americans will be affected by the estate tax too.
😡 First keep these facts in mind. The top 1% of tax payers pay 38% of all income taxes yet only have a 20% share of total AGI. – See more at: http://www.financialsamurai.com/how-much-money-do-the-top-income-earners-make-percent/#sthash.j8BRjKSp.dpuf
😡 An estimated 45.3% of American households — roughly 77.5 million — will pay no federal individual income tax, according to data for the 2015 tax year from the Tax Policy Center, a nonpartisan Washington-based research group. April 18, 2016
The political left has found effective buzz words; “fair share” implying that some Americans don’t pay their fair share without even defining the term. That notion plays well with many under informed Americans who probably think they pay more than their fair share. It’s also an easy way to mislead people into thinking they can forever have more simply by finding others to foot the bill. Look at the promises Clinton is making, especially the last three paragraphs in the following quote. She also claims government will create millions of jobs. What do you think happens in the long-term when government creates jobs?
She will do all she claims funded by 0.02% of American taxpayers (sort of) and corporations.
Restore basic fairness to our tax code. Hillary will implement a “fair share surcharge” on multi-millionaires and billionaires and fight for measures like the Buffett Rule to ensure the wealthiest Americans do not pay a lower tax rate than hardworking middle-class families. She’ll close loopholes that create a private tax system for the most fortunate, and she’ll ensure multi-million-dollar estates are paying their fair share of taxes.
Close corporate and Wall Street tax loopholes and invest in America. Hillary will close tax loopholes like inversions that reward companies for shifting profits and jobs overseas. She will charge an “exit tax” for companies leaving the U.S. to settle up on their untaxed foreign earnings. She will close tax loopholes that let Wall Street money managers pay lower rates than some middle-class families. And she’ll reward businesses that invest in good-paying jobs here in the United States.
Simplify and cut taxes for small businesses so they can hire and grow. The smallest businesses, with one to five employees, spend 150 hours and $1,100 per employee on federal tax compliance. That’s more than 20 times higher than the average for far larger firms. We’ve got to fix that.
Provide tax relief to working families from the rising costs they face. For too many years, middle-class families have been squeezed by rising costs for everything from child care to health care to affording college. Hillary will offer relief from these rising costs, including tax relief for Americans facing excessive out-of-pocket health care costs and for those caring for an ill or elderly family member.
Pay for ambitious investments in a fiscally responsible way. Hillary believes that we can afford to pay for ambitious, progressive investments in good-paying jobs, debt-free college, and other measures to strengthen growth, broaden opportunity, and reduce inequality. Hillary will use the proceeds from ensuring the wealthiest and the largest corporations pay their fair share to pay for these investments without adding to the debt. Source: hillaryclinton.com
The method to achieve:
Today at an organizing event in Waterloo, Iowa, Hillary Clinton unveiled a new surcharge on multi-millionaires to ensure these taxpayers pay their fair share so we can invest in creating good-paying jobs and raising wages for the middle class, not just those at the top. Expanding on the central idea of the “Buffett Rule,” she called for imposing a four-percent “Fair Share Surcharge” on Americans who make more than $5 million per year – a measure that would only affect the top 0.02 percent of taxpayers. The remaining 99.98 percent of taxpayers would be unaffected. Clinton has pledged that she will not raise taxes on middle-class families and has already proposed tax relief for college and health care costs.
Clinton’s “Fair Share Surcharge” is a direct way to guarantee that effective tax rates rise for the taxpayers most likely to avoid paying their fair share through tax gimmicks and exploiting loopholes. Clinton’s proposal would force Americans making more than $5 million per year to pay an effective rate higher than middle-class families, along with other measures she has proposed to close loopholes such as the “Buffett Rule.” Source: hillaryclinton.com
What Clinton doesn’t mention is that what she could collect probably won’t pay for all her promises and more important, she fails to explain the probable consequences; like her programs would be permanent and growing in cost, but the taxes collected would be variable. Various organizations have evaluated the tax proposals, but not the overall impact given the new spending on her yet to be defined “ambitious investments” or tax cuts and health care subsidies. Consider the following.
Analysis by The Tax Foundation
Hillary Clinton would enact a number of tax policies that would raise taxes on individual and business income.
Hillary Clinton’s plan would raise tax revenue by $498 billion over the next decade on a static basis. However, the plan would end up collecting $191 billion over the next decade when accounting for decreased economic output in the long run.
A majority of the revenue raised by Clinton’s plan would come from a cap on itemized deductions, the Buffett Rule, and a 4 percent surtax on taxpayers with incomes over $5 million.
Clinton’s proposals to alter the long-term capital gains rate schedule would actually reduce revenue on both a static and dynamic basis due to increased incentives to delay capital gains realizations.
According to the Tax Foundation’s Taxes and Growth Model, the plan would reduce GDP by 1 percent over the long-term due to slightly higher marginal tax rates on capital and labor.
On a static basis, the tax plan would lead to 0.7 percent lower after-tax income for the top 10 percent of taxpayers and 1.7 percent lower-income for the top 1 percent.
When accounting for reduced GDP, after-tax incomes of all taxpayers would fall by at least 0.9 percent.
CONCLUSIONS by the Tax Policy Center
Hillary Clinton has proposed a number of tax changes that would raise revenues and make the tax system more progressive, primarily by raising taxes on higher-income individuals. The proposals would tighten the system of international taxation by reducing avenues for tax avoidance, which contrasts with other prominent proposals that would eliminate taxation of foreign income.
The proposals also include various incremental reforms that are mostly aimed at closing loopholes and eliminating subsidies for fossil fuels. However, the proposals would make the tax system more complex—most notably by adding three variants of a minimum tax to the already complex individual alternative minimum tax. And the proposals would raise marginal tax rates on labor and capital, thus reducing incentives to work, save, and invest among high-income households.
The proposals would increase federal revenues by $1.1 trillion over the next 10 years and would therefore reduce future deficits and slow, somewhat, the accumulation of public debt. However, the campaign has indicated that it plans to announce other proposals including a tax cut for low-and middle-income households, so the overall effect of Clinton’s proposals on the deficit, the distribution of tax burdens, and the economy are yet to be determined.
So exactly what is a fair share of ones income that should be confiscated by government, and then with what’s left after the bureaucracy does its thing, transferred to other Americans?