The voices of Tax Policy Center's researchers and staff
TPC shows how President Obama would redistribute income from the rich to the poor. The President will release his budget next week, and with it, a tax plan analyzed by the Tax Policy Center. TPC’s Howard Gleckman explains that under the plan, after- tax income would increase by about $175 in 2016 for households making $25,000 or less in expanded cash income. After-tax income would drop by about $29,000 for households making $663,000 or more. The very, very rich, who make at least $3.4 million a year, would see their after-tax income cut by about $168,000, on average. Middle-income people would see relatively little change in their average tax bill, though there would be winners and losers.
Retirement “loopholes” reflect acts of an extravagant Congress. President Obama’s new budget would close the “loophole” that allows the very rich to stash huge sums of money in tax-favored retirement plans. Under Obama’s plan, once those plans hit $3.4 million, contributions would have to stop. But many of these giant IRAs are not the creation of unintended loopholes at all, TPC’s Steve Rosenthal explains. Congress has explicitly and dramatically expanded both individual and employer-sponsored retirement plans in recent years, often without income limits. “Labeling large IRAs and retirement plans ‘loopholes’ mischaracterizes Congress’ generosity (or profligacy).”
Who needs deflate-gate when you have tax exemptions? Just in time for the Superbowl, Utah’s Republican Representative Jason Chaffetz has again introduced legislation to take away tax-exempt status from both the National Football League and the National Hockey League. The NFL and NHL are classified as trade organizations and are tax-exempt, unlike Major League Baseball or the National Basketball Association. The Joint Committee on Taxation said last year that repealing the exemption would raise about $109 million in revenue over a decade.
Who needs SCOTUS when you have public opinion? In March, the US Supreme Court will hear the case against Affordable Care Act tax subsidies available through federal health exchanges. Meanwhile, a Kaiser Family Foundation tracking survey finds that a majority of those polled—64 percent—want Congress to pass a law guaranteeing such subsidies if the Court rules against them. Of people in states with federally-run exchanges, 59 percent said their states should establish their own marketplaces if the justices rule against subsidies through federal exchanges.
And for those who need a good data tool… TPC’s State and Local Finance Initiative has a new one that allows for comparative, single state, or time series analyses of data from the Census of Government’s State and Local Finance series. Data include detailed revenue, expenditure, and debt variables for the US, each of the 50 states and the District of Columbia for 1977 through 2012. The data are available by type of government and present state aggregates of finance data for the selected level of government. Users can view the data along different dimensions, in real or nominal dollars, and on a per capita or fraction of personal income, general revenues or total expenditures basis.
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Posts and Comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.