…at least that is what the Obama Administration would have you believe when you look at their proposals for increasing taxes on the “wealthy”, all in the name of reducing the national deficit. After all, the rich can afford it, right?
- The “New Era of Responsibility” will increase the tax rates for those earning over $250,000 a year as a married couple, to 36% and 39.6%. Rates are currently at 33% and 35%.
- Tax payers making over $250,000 per year will be limited on the itemized deductions they will be allowed to take on their returns. In essence, anyone that falls in a tax bracket higher than 28% won’t be able to take advantage of programs, such as mortgage interest deduction. By the way, the estimated $318 Billion that this provision will bring in, will go to funding the nationalization of health care. Thank you “super rich” for giving health care to everyone. (heavy sarcasm intended)
- The tax rate for capital gains and dividends for those earning over $250,000 per year will increase to 20%, currently taxed at 15%. I guess the White House believes that the wealthy can afford another 5%, on top of all the other tax increases they will be slapped with.
Now many people ask me why I defend the wealthy. Let me just tell you that I am not wealthy, falling into the middle class as I have always lived. But this is America, and I dream of becoming wealthy some day, and some day, all of this could effect me. It is also a well known fact that the wealthy in America provide the jobs and the financial backbone which keeps this country going. Raising taxes on them causes them to cut back on investing, take business overseas, or cut jobs, etc. Not something we really need right now in a failing economy.
But the silver lining on all of this is the fact some Democrats in Congress do not like parts of Obama’s plan, and could force the President to rethink his taxing of the wealthy. The Wall Street Journal reported yesterday that some Senators question the limitation of deductions as it could further depress the housing market. After all, if you can’t deduct your mortgage interest, maybe a wealthy buyer won’t consider buying at all.
Others question using the extra money towards health care, something that has nothing to do with tax rates, etc. Robbing from Peter to give to Paul, so to speak. I guess the main issue here is that in the rush to fix the economy, the White House is throwing not only the kitchen sink into the mess, but the plumbing as well. Hey, if the wealthy can “afford” to give more of their hard earned money, as long as it contributes to the “greater good”, it is OK, right?