Thursday, April 15, 2010

Happy Tax Day!

And cheers to celebrating lower taxes for the middle class! While the whiter, wealthier, and supposedly better educated teabaggers go out and protest better health care for more Americans and progress toward economic recovery, we can take heart in some great new statistics that Desert Beacon caught this morning.

1) Taxes on the American middle class haven't been this low in decades. You don't have to believe me, try the BizJournal report: "With the new tax cut, the median family's federal income taxes will equal just 4.6 percent of its income in 2009. That is lower than in any year since 1955 (the first year for which these data are available) except for 2008, when another stimulus-related tax cut was in effect." A person might want to squawk about increasing property taxes or local/state sales taxes, but the facts are the facts, and the Obama Administration's tax cuts mean that FEDERAL income taxes are now the lowest on record since 1955, with the single exception of one year in the interim.

2) Even though only 12% of those polled in one survey thought they were getting tax cuts this year the “Making Work Pay” tax credit gave most working people a $400 refundable tax credit. This credit is worth $800 to most working married couples. More than 94 percent of all working families and individuals received this tax cut. [CTJ pdf] But wait, as they say on the infomercials, there's more: "Changes to the $1,000 per-child tax credit and the earned-income tax credit gave an average of $872 each to 12 million, mostly low-income working families with children." [CTJ pdf] The only group not seeing major tax cuts under this Administration's tax policies are the top 1% of all income earners in the U.S, and even then about 29% of those people can expect a tax liability reduction. 56% of the Bush tax cuts went to the top 5% of all income earners in the United States.

3) Directly related to the decrease in the middle class tax liability is the fact that the average tax refund has increased this year. "Americans who have filed their taxes have discovered that the average refund is up nearly ten percent this year – to an all-time high of about $3,000. This is due in large part to the Recovery Act. In fact, one-third of the Recovery Act was made up of tax cuts – tax cuts that have already provided more than $160 billion in relief for families and businesses, and nearly $100 billion of that directly into the pockets of working Americans." [WH]

4) The Treasury Department is now authorized to close loopholes that allowed millionaires and billionaires to hide income from the government in secret off shore accounts. [NYT] "Individuals have stashed an estimated $1 trillion in offshore accounts, the government says, allowing them to avoid up to $70 billion in taxes each year. The federal government estimates that abusive offshore schemes by corporations cost our Treasury an estimated $30 billion in tax revenue as well." Title V, Section 501 of H.R. 2847 make this very specific: "Amends the Internal Revenue Code to revise and add reporting and other requirements relating to income from assets held abroad, including by: (1) requiring foreign financial and nonfinancial institutions to withhold 30% of payments made to such institutions by U.S. individuals unless such institutions agree to disclose the identity of such individuals and report on their bank transactions; and (2) denying a tax deduction for interest on non-registered bonds issued outside the United States. " In short, the millionaires and billionaires can no longer stash their funds in foreign banks and avoid paying their fair share of our overall tax burden.

I'll have more for you later, when I'm at Progress Now's Tax Day Rally. And btw, I'll be live-tweeting from there today @atdleft... So follow me, peeps! :-D

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