By way of this chart, Citizens for Tax Justice makes an important point about President Obama’s plan for extending the middle-income Bush tax cuts:
We talk about the Bush tax cuts as if there is one set that applies to people with income under $250,000 and another set that applies to people with income over $250,000. But that’s not quite the case. The “middle-class” Bush tax cuts apply to all taxable income under $250,000; if your taxable income is $1 million, then you’ll receive a tax cut on the first $250,000. Under the Obama plan, everyone receives a tax cut.
The argument is over whether there should be an additional tax cut for income over that amount. According to CTJ, the Republican plan would triple the tax cut received by the richest 1 percent of taxpayers. Obama says that this isn’t worth the expense, while Republicans disagree and will not pass middle-income tax cuts unless they’re joined by an extension for upper-income cuts. Whether or not you see the GOP’s position as justifiable depends entirely on whether you think the rich deserve an even larger share of the nation’s income.
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