Rubio is a "no" on tax plan without increased welfare

[Superfluous Man]

I keep seeing stories that this tax plan will result in a lot of low income and middle class people paying more in taxes though, on account of the loss of their deductions.

Rubio's approach is the wrong one. But they still should have made bigger cuts at the low end to offset the losses of deductions.

 

[Brian4Liberty]

I keep seeing stories that this tax plan will result in a lot of low income and middle class people paying more in taxes though, on account of the loss of their deductions.

Rubio's approach is the wrong one. But they still should have made bigger cuts at the low end to offset the losses of deductions.

Zero income tax up to $300,000 per year might be good. That will take care of the poor and middle class.

No individual income tax rate should be more than the corporate tax rate.

 

[angelatc]

I keep seeing stories that this tax plan will result in a lot of low income and middle class people paying more in taxes though, on account of the loss of their deductions.

But they still should have made bigger cuts at the low end to offset the losses of deductions.

WaPo said that 85% of people in all quintiles will see lower taxes. They increase the personal exemption to offset the loss of deductions.

Here's a calculator: http://taxplancalculator.com/calc

Important changes:
-- medical deduction NOT ended
-- student loan deduction NOT ended
-- tuition waivers NOT ended
-- mortgages capped at $750k for
deduction; current homeowners
grandfathered in
-- child credit made more refundable
-- rates lowered (see details to left)
-- state/local deductions now allowed up
to 10k (property, income, or sales)
Other notes:
These do not change from current law:
-- social security earnings not changed
-- business owner expensing not changed
-- EITC not changed

 

[Brian4Liberty]

Rubio's tax credit and Rand's interest deduction are not remotely similar. And I am pretty sure you know that. I don't agree with it just like I don't favor being able to deduct mortgage interest. I favor a no deductions and a flat tax. But would you say allowing mortgage interest to be tax deductible is welfare? It is a one for one analogy.

I mean Rothbard and that crew are pretty big on these kinds of deductions. I don't even view it as unprincipled.

Agree. Once you start playing the deduction game, it will be corrupted. It creates incentives and decentives, usually with the goal of economic or social engineering. It always leads to cronyism and favoritism.

It also highlights an essential difference between corporate taxes vs. individual taxes. Even if they were the same rate, a business gets write-offs and deductions that an individual will never get.

 

[Zippyjuan]

Zero income tax up to $300,000 per year might be good. That will take care of the poor and middle class.

No individual income tax rate should be more than the corporate tax rate.

$300,000 a year puts you in the top three percent. http://money.cnn.com/calculator/pf/income-rank/index.html

 

[Madison320]

In a free market, everybody is out to get as much as they can for themselves. If the company owners can keep the money and avoid giving it in the form of wages, they will. It isn't about "spreading the wealth around".

I remember when Ender said, many times, that Zippy is not left wing.

 

[Madison320]

Zero income tax up to $300,000 per year might be good. That will take care of the poor and middle class.

Sarcasm?

 

[Brian4Liberty]

$300,000 a year puts you in the top three percent. http://money.cnn.com/calculator/pf/income-rank/index.html

So that would protect the middle class.

Too high? Where would you cut it off to properly redistribute the wealth?

Sarcasm?

Well, if we need to raise it so that it only taxes the top 1%, I'm fine with that. Original intent and all...