Friday, November 12, 2010
Top Earners May Face Big Hit
Citizens who itemize their deductions need to worry. A new tax plan will eliminate certain tax deductions and investment breaks in order to generate moretax revenue. Mortgage interest rates and capital gains rate may be altered for higher tax revenue. If this plan becomes a reality, the overall tax revenue will increase by $751 Billion by 2020. The plan's most basic purpose is to eliminate tax expenditures, the accumulation of deductions, credits and other tax benefits that Congress had adopted over the years for individuals as well as companies. Maybe this plan is not the best plan to introduce especially before elections.
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5 comments:
It will be interesting to see how this plays out politically. Will new 'tea party' inspired congressman and women react adversely to this... even if it is meant to cover the deficit? I think this demonstrates an inconsistency in their message that they need to resolve before 2012.
There is a big debate among how to eliminate the federal deficit, between the conservatives and the democrats. The democrats want to extend tax cuts to everyone but the top 2% and the conservatives want tax cuts for everyone. Unless they reach some sort of agreement then taxes will go up for everyone after this year. It will be interesting to see other attempts to keep taxes low and reduce the deficit..
I think the best way to cut the overall deficit is too get rid of the tax break. The United States has a huge debt and the $751 billion will really help decrease that. Like Scott says, it will be interesting to see what happens with this issue.
The "trickle-down theory" is questionable at best in its effectiveness at stimulating growth. Instead of making the rich richer, let's redistribute wealth a bit and eliminate the tax deductions. This will also help the US pay back the ever-increasing national debt.
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