Return of the tax families

[LSK]

The selling strategy for the first Bush tax cut relied heavily on “tax families” — photogenic families who would supposedly be the big beneficiaries of the tax break. In fact, they were mainly beneficiaries of the child tax credit and the “cutout”, the reduction of some peoples’ rates from 15% to 10% — and they were carefully chosen to give a misleading picture both of how the typical family would fare and who the real main beneficiaries were.

Well, there they go again. This is from the “fact sheet” on Bush’s stimulus proposal.

The President’s tax cuts are set to expire in less than three years. If Congress allows that to happen, we will see an end to many of the measures that have helped our economy grow - including the 10 percent individual income tax bracket, repeal of the Federal death tax, reductions in the marriage penalty, the expansion of the child tax credit, and reduced rates on regular income, capital gains, and dividends. This would mean that:
? A single mom with two children and $30,000 in earnings would see her taxes go up by 67 percent.
? An elderly couple with $40,000 in income would see their taxes go up by about 155 percent.
? Twenty-six million small business owners would see their taxes increase by nearly 17 percent - or about $4,000 on average.

That single mom and elderly couple are both carefully chosen, to be families with just enough income to pay a bit of taxes now; I can’t quite figure out the dollar amounts, but those huge percentage increases surely represent pretty small sums of money.

And bear in mind that none of the Democrats are proposing to eliminate the child credit or the cutout, which I’m almost sure are the basis for both of these examples.

Wouldn’t it be nice if, just once, the Bushies could refrain from trying to con the public?

http://krugman.blogs.nytimes.com/2008/01/18/return-of-the-tax-families/