Monday, December 16, 2002

Tax the poor!

In a must-read article in the Washington Post, champions of a revised tax system give their reasons for increased taxes on the poor and middle-class. It's wild, and not confined to cranks outside the government. Here are some highlights:
  • As the Bush administration draws up plans to simplify the tax system, it is also refining arguments for why it may be necessary to shift more of the tax load onto lower-income workers.

  • The Treasury Department is working up more sophisticated distribution tables that are expected to make the poor appear to be paying less in taxes and the rich to be paying more.

  • ... outgoing White House economic adviser Lawrence B. Lindsey [said] the 12.4 percent Social Security levy should not be considered when tax burdens are calculated.

  • J.T. Young, the deputy assistant treasury secretary for legislative affairs, lamented in a Washington Times opinion article: "[Higher] earners cannot produce the level of revenues needed to sustain the liberals' increasingly costly spending programs over the long-term. . . . If federal government spending is not controlled, then the tax burden will have to begin extending backward down the income ladder."

  • Rep. Jim DeMint (R-S.C.) has argued for two years that the nation is entering a dangerous period in which the burden of financing government is falling on too few people.
    • DeMint and his allies have called for a national sales tax to replace the income tax. For those below the federal poverty line, sales taxes paid would be refunded, but under the system, at least they will have seen the cost of government, he said.

    • The working poor would accept a higher tax burden because they would be relieved of the need to file a tax return.
UPDATE: This scheme seems more like a bargaining position than anything real. Perhaps advocates are hoping that when Bush's additional cuts for the rich are debated, opponents will say, "Okay. At least they're not raising taxes on the poor."


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