Millionaires benefit most from the Bush tax cuts

As part of the Americans for Tax Fairness Coalition, there are a common set of values and principles that Washington CAN!  supports around fairness and equity in our tax structure:

  • America needs an economy that grows jobs and works for all. Our nation has urgent needs, including creating sufficient jobs, investing in education and making college affordable, rebuilding our deteriorating infrastructure, shoring up Social Security and Medicare for the long term, reducing poverty and protecting the most vulnerable, and reducing the federal deficit in a balanced way as the economy recovers.
  • Everyone must pay their fair share. We need to reform our tax code so it raises adequate revenues to meet critical needs in a fiscally responsible manner — starting with wealthy Americans paying their fair share. This includes ending the Bush tax breaks for the richest 2 percent of Americans.
  • Put American jobs first by closing corporate tax loopholes. We also need to eliminate tax breaks and subsidies that allow some corporations to pay very limited amounts of taxes, or avoid paying taxes altogether, while encouraging multinational corporations to ship jobs overseas. Corporations’ share of federal taxes has declined dramatically over the years; therefore, any corporate tax reform should require the corporate sector to contribute more in federal income-tax revenue than it does now, not less.

 After a two year extension the Bush tax cuts are set to expire on December 31, 2012. When paired with the planned across-the-board cuts to military and domestic spending (called sequestration) scheduled to take place in January of 2013, the debate is likely to continue to play out as we move forward.

Bush tax cutsWe can no longer afford to lavish tax gifts on those who don’t need them. As shown in the graphic, for people making an annual income of over $1 million, the average Bush tax cut is $143,000. In contrast, people making $50,000 only receive a tax cut of $1,000. Asking everyone else to work harder and pay more in order to keep up tax perks for the rich is a road to fiscal and national ruin.

That’s why we’re demanding that Congress end the Bush tax cuts on the top 2% (families that make $250,000/year and above) to ensure that everyone does their part to get our country back on track.

Why should we end the Bush tax cuts on the top 2%?

  • Ending the Bush tax cuts on the top 2% would raise $829 billion over the next 10 years
  • The Bush tax cuts give a $143,000 tax break, on average, to someone who makes more than $1 million a year. Tax cuts should not go to those who need them the least. 
  • So that the wealthy are paying their fair share to help reduce the deficit, invest in health care and education, and fix the economy

Despite this, Republicans in Congress are trying extend the Bush tax cuts to the top 2%, ensuring that the wealthiest continue to reap the benefits of our unjust tax structure.

Think of it this way: if Medicare costs a dollar and we let the ultra-rich pay 4 cents less, who makes up the rest? Either the middle class pays in higher taxes or seniors pay in higher health care costs.

To take the argument a step farther: a targeted middle class cut would actually require two things: 1) the expiration of Bush Tax Cuts for those making over $250,000 and 2) the increase of the Individual Income Tax for the richest tax brackets. This is not only do-able. It’s been done before in a time very much like ours.

We need to oppose all attempts to preserve the Bush Tax Cuts for the rich. Likewise, we should stand up for a targeted middle class tax break. The richest Americans can and should pay the rates outlined in H.F. 1124, Rep. Jan Schakowsky’s bill to raise income tax rates on millionaires and billionaires exclusively.

It’s time for those who have done well in America to do once again well by America.

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