Bush Offers Greater Tax Relief For Lower-Income Taxpayers
September 5, 2000
Tax experts report that presidential candidate George Bush's across-the-board tax cut package promises substantially greater benefits for those at the lower end of the income scale than it does to wealthier taxpayers -- regardless of the claims of his rival that it "favors the rich at the expense of the poor."
Here's how Bush accomplishes that:
- The very lowest earners, those who make enough money to have to file tax forms, but not enough money to pay, will benefit from Bush's plan to return some 2-3 percentage points of Social Security taxes so they can invest in individual retirement accounts -- representing a tax cut of 16 percent to 24 percent for those 30 million return-filing, nonpaying earners.
- By offering a reduction in the bottom tax rate from 15 percent to 10 percent and doubling the child credit from $500 to $1,000, the Bush cut would leave six million two-parent, two-child families with incomes of less than $35,000 owing zero in taxes -- while the same family earning between $40,000 and $50,000 would see an average reduction of 55 percent.
- Higher income families would not get near the same percentage reductions -- only 30 percent on average for those in the $50,000 to $75,000 income category, 18 percent in the $75,000 to $100,000 income group and only 10 percent in the over $100,000 group.
Analysts point out that everyone benefits since the cuts are across-the-board, rather than targeted at a handful of favored groups. Under Al Gore's plan, people would either have to have a child in day-care or in college, be a beneficiary of an estate, have an ailing parent or be married in order to receive any tax relief.
Source: Editorial, "Truth on Tax Cuts," Wall Street Journal, September 5, 2000.
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