payroll taxes

Income Taxes Lowest Take Since 1950?

Submitted by on

Income taxes are at their lowest since 1950, their share of the total economy that is, according to AP article.

As a share of the nation's economy, Uncle Sam's take this year will be the lowest since 1950, when the Korean War was just getting under way.

And for the third straight year, American families and businesses will pay less in federal taxes than they did under former President George W. Bush, thanks to a weak economy and a growing number of tax breaks for the wealthy and poor alike.

Yet, is it fair to compare tax revenues from before the great job slaughter of the last three years? Isn't it even less fair to compare tax revenues to percentage of GDP, when more and more Americans are not sharing in the booty?

From the CBO director's blog, we can see that personal income tax revenues increased 10% from this time last year.

Receipts for the first four months of fiscal year 2011 were about $64 billion (or 9 percent) higher than receipts during the comparable period last year, CBO estimates. Nearly all of that increase was from individual income and social insurance taxes, which together rose by $60 billion (or 10 percent).

Withholding from employees’ paychecks for income and payroll taxes increased by $45 billion (or 8 percent), at least partly reflecting higher wages and salaries; the increase would have been slightly larger but for the Making Work Pay tax credit, which was in effect in 2010, and the temporary payroll tax reduction, which started in January 2011.

Tax Stocking Stuffers for Corporations

Submitted by on

We already know the rich and corporations got quite a haul in the tax bill. USA Today outlines some business tax credits as if the tax breaks under the great giveaway tree aren't enough.

The massive new tax bill signed into law by President Barack Obama is filled with all kinds of holiday stocking stuffers for businesses: tax breaks for producing TV shows, grants for putting up windmills, rum subsidies for Puerto Rico and the Virgin Islands.

There is even a tax break for people who buy race horses.

This is the most outrageous one, a tax break for corporations who invest overseas. Remember all of the rhetoric about banks not funding investment and growth in America, not loaning to businesses? This is the opposite, our Congress just made it pay to create economic growth abroad!

There is a generous tax break for banks and insurance companies that invest overseas, a tax credit for railroad track maintenance, more generous write-offs for upgrading motorsport race tracks,

I kid you not! Here is what this does. It's an exemption that allows banks, insurance companies and other financial firms to shield foreign profits from being taxed by the U.S. through 2011. Cost: $9.2 billion.

Did you think in 2008 you would read this headline, "Democrats about to pass Bush Era Tax Cuts"?

Submitted by on

Democrats control the Senate. So, did you ever imagine this headline from Business Week, Senate Set to Pass $858 Billion Bush-Era Tax Cut Measure Today:

The U.S. Senate today is poised to pass President Barack Obama’s $858 billion proposal to extend Bush-era tax cuts for all income levels, cut payroll taxes and extend expanded jobless benefits.