Under President George W. Bush Individual and Corporate taxes were lowered. What that means is there is less revenue coming into the U.S. Treasury, which in turn increases the U.S. deficit.
The tax cuts put into place during the Bush administration are due to expire on December 31, 2010 and revert back to the tax rates in effect under President William J. Clinton. If you’ll recall correctly that is when the U.S. had budget surpluses as far as the eye could see.
Republicans are adamant about extending the Bush tax cuts and they’ll give you any number of reasons why the cuts should be extended – it’s not good for the economy to raise taxes now, it will put small business owners out of business, and it will put all the rest of us in the poor house by raising taxes.
What they, and the media, is failing to tell you is an extension will do more than simply keep the tax rates at their current levels.
It will also keep capital gains tax rates at 5% and 15% (depending on AGI), instead of reverting back to 10% and 20%.
It will also tax dividends at ordinary income tax rates, instead of at 5% and 15%, which is the current rate.
It will also completely reinstate the estate tax at a high rate of 60 percent, with a $1 million dollar exemption. The estate tax was completely eliminated in 2010 by the Bush tax cuts.
Who do you think is going to benefit from the above? It isn’t going to benefit the average working person, it’s going to benefit the people that have the type of income that you’d like to have.
The media isn’t telling you about these other changes because members of the media earn the kind of money you’d like to earn, and seem more than willing to sacrifice honest reporting for paying fewer taxes on tax day