Originally Published: December 13, 2017 5:53 a.m.
The latest letter to the editor written by Susan Lanning about taxes is probably the biggest distortion ever written. The letter shows Ms. Lanning’s total lack of knowledge/expertise about our federal tax system. First of all the federal tax system does not tax wealth.
Also let’s talk about deficit spending. During the 8 years of the previous president we added $10 trillion to our debt. The Republican plans can only add 1.5 trillion over 10 years. The Reagan/Bush tax cuts added to the treasury. They created full-time jobs not part-time jobs.
Ms. Lanning and others say the wealthy will benefit the most. Not true. By percentage high income wage earners receive the smallest percentage of the cuts. In the Republican plan, high-wage earners in blue states with the reduction or elimination of itemized deductions may have a tax increase.
Now let’s see if a middle class family with two children and an adult dependent son or daughter in college get a tax cut. The middle class tops out at $125,000 AGI. So for this example a family with an AGI of $114,000 minus $24,000 standard deduction taxable income of $90,000 tax liability of $10,800 minus $3,200 2 children minus $300 adult son/daughter final tax liability of $7,300. Effective tax is 6.4 percent. I guess we call that a middle class tax cut. The purpose of the tax reform is to broaden the tax base and with the business end boost employment/wages. Given our near full employment and expansion of business under the cut employees will be able to demand higher wages.