Uncivil Rights

A few things from “On the Move” #88, February 2005, from Illinois Council 31 – American Federation of State, County, and Municipal Employees.

From Henry Bayer – “Taxes, What we need is a fairer system, then it might not be so hard to raise revenues”

The unfairness of our tax system is not confined to the state of Illinois, however. Between 2001 and 2003, the effective federal corporate tax rate was reduced by 20 percent. Corporate taxes have fallen to their lowest level in more than 40 years.

Yes Henry, and those reductions in taxes by the Bush administration did a miraculous job reducing that recession from the dot.com bubble burst to a minimum. Oh, and then we had a small thing called a terrorist attack that cost this country and the economy billions of dollars. Oh, and then we had a small war in Afghanistan and Iraq. Those tax cuts kept this economy rolling; an economy which is gaining speed and strength every day.

If you thought that big business and its political allies would be satisfied by these huge breaks, you'd be wrong. Major corporations pushed a measure through the Congress allowing them to pay taxes on profits earned abroad at one-seventh the normal rate.

Tell me Henry, why should a company pay taxes here in America for the business it does overseas? The normal American tax rate on profits made abroad should be ZERO. The American companies doing business abroad are the ONLY companies that are taxed in their home country (America) AND in the host country. American businesses were unable to compete in foreign markets because the TAX playing field was not level. American companies needed those tax breaks to compete. Under your astute thinking, American companies would pay full taxes, here and abroad and would therefore fail abroad, not only losing jobs there but HERE also. Good thinking Henry.

It's not just giant corporations that complain about their high taxes. Wealthy individuals, who even after getting the biggest chunk of Bush's recent tax cuts, echo the charge that they, too, are being overtaxed.

You'd never know from listening to the howls of the super-rich that much of their income is taxed at a lower rate than most of us pay on most of our income. Capital gains and dividends are taxed at a fraction of the rate of wages — a difference that overwhelmingly benefits high income earners, while we get only crumbs off that table.

Let’s see, why are wealthy people complaining about their taxes? It’s because they PAY THE MOST! It doesn’t matter what the rate is; the fact is the rich pay more taxes. 10% of $500,000 is $50,000; 50% of $50,000 is only $25,000. Rates DON’T MATTER, it’s the AMOUNT OF MONEY PAID IN TAXES!!! Money made from capital gains and dividends are taxed at a lower rate because the money used to earn capital gains and dividends have been taxed once already, and this money invested helps grow the economy and therefore increase taxes as well. Anyone can invest in the market, not just rich people, but I’ve never received a job from a poor person.

I can't see the point. Folks collecting capital gains and dividends certainly don't work harder for their income than those of us whose earnings are mostly wages.

Think again Henry. How did those people earn their money? They worked for it, made the correct decisions on life, saved money, and became able to invest. Don’t blame them for making the right choices in life.

While we continue to drift away from the principle that taxes should be based on one's ability to pay, governments at every level are scrambling to find resources for vital services. It would seem that the time is ripe to reverse the trend and bring greater fairness to the tax system, while making sure we raise enough revenues to fund vital services.

How about the government NOT spending MORE than the amount of taxes it collects? Perhaps we should look at YOUR definition of “vital services”? As you increase taxes on the rich, the rich will reduce their “ability” to pay. We should make the tax system more fair by instituting the Fair Tax Plan.

For starters, the President insists that the tax cuts passed in his first term, which went disproportionately to individuals making more than $300,000 annually, and which are responsible for one half of the $420-billion federal deficit, must be made permanent.

Yes they should be made permanent. Again, I have never received a job from a poor person, but I have received a job from a rich person that was able to KEEP MORE OF HIS OWN MONEY which enabled him to invest in his business, expand that business to the point of HIRING MORE PEOPLE. You may also want to check out how much our country’s SAFETY (as in Homeland Security and the war in Iraq and Afghanistan) is part of that deficit.

Secondly, despite the need for more revenue to fund education, health, and other important programs, the president says that any changes in taxes must not result in any net revenue increase.

More money for schools? How about fixing the problems with schools FIRST then analyze the need for and amount of funding? I don’t believe I should pay for someone else’s health care because they “can’t” afford health insurance. All other entitlement programs should be eliminated.

If we're talking about shifting the tax burden but raising no more money, it means some folks will pay more taxes while others pay less. And guess what? Under all the tax schemes being considered by the administration and its allies, our tax system would become even more skewed in favor of the well-to-do.

Let’s be truthful. The rich and wealthy, though they may have their tax rates cut, will still pay more taxes than the other groups even if the amount the others pay goes up. Remember, it’s not the rate; it’s the AMOUNT paid in taxes that count. Overall, why shouldn’t the MAJORITY of people pay the MAJORITY of taxes? Obviously, the MAJORITY of people will utilize the MAJORITY of these “vital services” you claim we so desperately need?

For instance they're looking most seriously at a national consumption tax. But the less you make, the more of your income is spent on consumer goods, like food, clothing, gasoline or other daily necessities. So the less you make, the higher percentage of your income will go to taxes. In this manner our unfair tax system, in the name of reform, becomes even more unfair.

This is a lie, Henry. It is a lie, or you don’t know what you’re talking about; either one is reprehensible. Either you are trying to deceive your readers, or you haven’t read the proposal for the Fair Tax Plan. Every person working will receive their entire pay check, no deductions. Every family will receive a rebate for the taxes paid for the “necessities of life”. The taxes you actually pay depend on your spending habits; you control the amount of taxes you pay. The wealthy will continue to pay the biggest burden while the poor will their fair share on those expenditures OUTSIDE of the necessities of life.

Every change in the tax code should meet two tests: "Does it raise the revenues needed for essential services?" and "Do those with the most ability to pay bear their fair share of the burden?" The Republican tax plans fail on both accounts.

The Republican tax plan is just fine, thanks.

Cross Posted at Blogger News Network