2003 Tax Cuts: Looking Back
The 2003 tax cuts under George Bush gave the highest percentage tax cuts to the lowest brackets and much lower percentage cuts to the highest bracketsPercentage Cut on (highest bracket)(39.6% before)-(35% after) 11.61% Percentage Cut on (lowest bracket) (15% before)-(10% after) 33 1/3%
The 2000 tax tables contained 5 brackets before George Bush took office. The tax cuts were phased in from 2000 to 2003. By 2003, there were 6 brackets, so since not all brackets can be compared, we will instead make comparisons on dollar amounts. For instance we will compare the percentage cut for taxpayers in the lowest bracket earning for example $10,000 and taxpayers making $400,000-in the top bracket, about $90,000 above the amount in which a taxpayer reaches the top bracket. Because a person who pays $96,201 in the first stages of the upper brackets pays nine hundred sixty times more than someone who pays $100 dollars, his dollar amount of deduction will dwarf that of someone paying so little but the percentage is still much fairer to the lowest bracket taxpayer Cuts in Dollars $96,201 amount paid on $311,950 at 39.6% $84,184 amount paid on $311,950 at 35% Tax $96,201 divided by Am't of Reduced Tax $12,017 $12,017-amount of cut divided by $96,201, previous tax =12.49% Do we make a hero of one who pays $100 to pay the nation's expenses and a villain out of one who pays $84,184, even after giving a much better percentage cut to the taxpayer paying a tiny amount to begin with. Even though the higher bracket taxpayer reduced his payment by $12,000 he is still left with a tax bill of $84,184 compared to $100 for someone who was paying $150
 Custom Search All data below based on taxable income Married Filing Joint Return 0 dependents Before Bush tax cuts 6537 up to 43850 28% x 6150=1722=$8259 Taxes on $10,000=$1,500--After Cuts =$1000 Savings $500 Taxes on $20,000=$3000--After Cuts=$2300 Savings $700 Taxes on $30,000=$4500--After Cuts=$3800 Savings $700 Taxes on $40,000=$6000--After Cuts=$5300 Savings $700 Taxes on $50,000=$8259--After Cuts=$6800 Savings $1459 Taxes on $60,000=$11,100-After Cuts=$9020 Savings $2080 Tax on 14000=$1400 Tax on 36000=$5400 Total tax $6800 Income Redistribution, Tax Hikes Top Democratic Agenda By Donald Lambro Thursday, April 24, 2008 Full article Donald Lambro Excerpts: WASHINGTON -- Barack Obama and Hillary Clinton are coming under fire from some rather unusual quarters, and these critics are challenging their plans to hike taxes at a time when the economy needs all the stimulus it can get. These critics are also raising the r-word -- as in redistribution of incomes -- a political killer in any election cycle but especially in an economic downturn that is squeezing salaries across the board. The incoming fire isn't just from Republican John McCain, who thinks raising taxes in a sick economy is sort of like the 18th-century practice of bleeding. Criticism is coming from the news media and from academia. By PAUL RYAN, JEB HENSARLING, JOHN CAMPBELL & MICHELE BACHMANN The above three representatives of congress are proposing a simpler and fairer income tax. Some of the features are below: If taxpayers so choose, they can continue to use the present system as it is, including all deductions. Under this plan, they could opt to have a much more simple and transparent choice which has just two income rates-10 per cent for joint income below $100,000 and 25% for income above. This plan would have no special preferences (presumably meaning none of the present deductions, credits or anything classified as loopholes) but would have a generous standard deduction of $25,000 for joint returns and also have a personal exemption of $3500. A family of four would pay no taxes on income up to $39,000. This is eminently sensible. As far as producing revenue, the authors say: "We designed the simplified system to be similar to today's tax code in terms of how it distributes the burden across income groups. Thus, as with today's system, roughly 70 percent of its taxes are paid by the top 20 percent of earners. These are the most important features. The country should be insisting on this or something very close. It will take tremendous work to get congress to enact something like this, because their power comes above the good of America. Taxes that get added in to the monstrous and inefficient federal government do great harm. The four major U. S. tax cuts in individual tax rates, which put that money back into the private sector, all saw revenues to the government soar and saw the share of the total burden, paid by the rich, also shoot way up. President John F. Kennedy said this: In short, it is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now. -President John F. Kennedy New York Economic Club December, 1962 Lyndon Johnson and the congress gave us a 10% surtax on income in April 1968. It contributed significantly to the 1969-1970 recession. Congress rushed to end it early in 1970. In the meantime investment spending dropped by 7%, After getting rid of the surtax, investment spending made a solid comeback. If congress lets the Bush tax cuts expire, capital investment will be hurt far worse. From 1988-1990, Japan enacted many of the worst anti-capital features of the U.S. Tax Reform Act of 1986. Japan instituted its first capital-gains tax and greatly restricted tax-favored saving incentives for everyone below retirement age. It raised land taxes twice. These hits to capital devastated stock prices, land prices, the solvency of banks, and clobbered investment. It took Japan 15 years to recover. If Congress does this, expect similar results, maybe worse. We need further rate cuts and control on the out of control spending of the last 7 years. Enough damage will be done if the present cuts are not extended: the discussion to raise taxes is insane. Deficit Continues To Plunge Look at the latest good news due to the 2003 tax cuts. The Congressional Budget Office has released its preliminary estimates for Fiscal Year 2007 for the fiscal year just ended. The federal budget deficit fell again, by 35% to $161 billion. Since 2004, deficit spending has fallen by $251 billion, one of the most rapid declines in U.S. history. The deficit as a share of the economy is down to 1.2%, or about half the average of the last 50 years. Disgusting class warfare continues to be the order of the day among Democrats. Of course deception, denial and spin have become so ingrained in the Democratic modus operandi, one no longer expects an examination of facts from Democrats. The budgets they are proposing would no doubt slow the economy before too long, which of course would slow job creation and all the following negatives. Who would be hurt first, the least skilled and the least educated. Democrats endlessly throw around the words working families and middle class families, but bet your house, that if Democrats do not extend the Bush tax cuts, those working families will be the first ones hurt. Among the lower income taxpayers that benefitted from the Bush tax cuts, were those making Adjusted Gross Income of $40,000 That's $40,000 before taking deductions and exemptions. The average tax cut for that modest income was $1133, which happen to be a cut of 96%. That money was the taxpayer's to keep every year since then. Here is what will hurt millions of working families if Democrats have their way. An increase of $ 500 per child Small Business 13% increase Capital Gains tax increase 33% increase, which will hurt most of the 80 million workers who have 401 K'S. Death Tax AKA Estate Tax a 55% increase. Dividends a 164% increase. All this with a government that has been wildly out of control for decades. The deficit which was recently as high as $443 billion has now been revised further downward from the projected figure for this year of $248 billion, to $205 billion. That represents 1 1/2% of GDP, and one of the lowest figures in the industrialized world. This deficit is also lower than it's been in 24 of the last 30 years. Against truly overwhelming, consistent, long-range proof that lower tax rates increase the incentives to work, save and invest, the Loony Left is still in denial as to how the economy grows as a result of those lower rates and what follows. What follows is businesses start hiring more workers, and those workers have more to spend, so they do just that. A broader work base increases revenues to government, employers invest more, expand facilities more, expand inventories more, all because that money is circulating in the private sector efficiently, not in some wasteful unproductive government program. By 2005 when the 2003 tax cuts were becoming their most effective, revenues to government shot up a whopping 15%. The increase in 2006 was also quite hefty, increasing by 12%. This year the projection is for another 7% increase. Yet the denials continue from the Left. These are just a few of the facts relating to the benefits of those tax cuts. In the coming days many more facts backing up the benefits of the tax cuts and why we must get congress to extend them before they expire in 2010, will be presented here.
Below is the pattern of the 2003 Tax Cuts Liberal think tanks and many Democrats spend much time lying about these cuts. One of the deceptions involves the 43 million taxpayers who have jobs but pay no federal income taxes. Convoluted thinking and much 1984 type doublespeak have been used to bring about the deception, using these people who pay no taxes. Below are actual numbers and the exact pattern to show whose taxes were cut and by how much. Bear in mind, these are nothing more than reduced future payments, no one actually receives anything. The reductions represent cuts as a percentage of the taxpayer's former liability. A person with Adjusted Gross Income of $40,000 had a cut of $1133 or 96% A person with Adjusted Gross Income of $50,000 had a cut of $1133 or 42% A person with Adjusted Gross Income of $67,000 had a cut of $1133 or 22% A person with Adjusted Gross Income of $150,000 had a cut of $2247 or 10% A person with Adjusted Gross Income of $200,000 had a cut of $3077 or 9% 3 million of the lowest income net taxpayers were completely removed from the tax rolls. The remaining 91 million had an average reduction of $1126 6 million women with children had an average reduction of $558 12 million elderly had an average reduction of $1401 34 million families with children had an average reduction of $1549 21 million married couples (42 million taxpayers) had an average reduction of $1786 2003 Tax Cuts The Numbers For Years
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