The Rich to Pay More in Taxes

World News

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A new tax system proposed last week will increase overall taxes by 6 to
10%. Those who earn $500,000 or more will be hit hardest by the tax
bill proposed by House Ways and Means Committee Chairman Charles Range.
There are a number of reasons why Charles Range proposed the tax bill
and it appears to make sense. The change may reflect the overall new
realities of the economy and the demographic responsibilities of the
rich.The Changes:Those who earn a million dollars or
more currently pay 18% of all federal taxes but that number will rise
to 20%. Likewise those who earn $500,000 to $1,000,000 will move from
6.7 % to 7.1%. Those who make between $100,000 to $200,000 will see a
drop from 25.4% to 24.3%. Most of the 86 million households would get a
tax cut in 2008 and 3.6 million households will pay more taxes. Lower
income houses will get more tax credits and the Alternative Minimum Tax
may be repealed (AMT). The AMT was originally designed to encourage the
wealthy to pay their taxes and while using the AMT a person cannot get
the advantages of a number of different tax bills. However, as
inflation has degraded the dollar and people earn more dollars the AMT
is not affecting millions of middle class Americans. Getting ride of
the AMT and offsetting with additional taxes on the wealth will open
some middle class Americans up to these tax breaks. If Range’s
Bill actually gets passed we won’t see any major changes until 2009.
Upon that year much of what we currently know about our tax world may
change dramatically and the pressure on the Middle Class will be
reduced. The new tax proposals are likely to be seen by the super
wealthy who controls the government administration and public offices. The Reasons: The
demographics of the country have changed significantly. There are more
current millionaires and new millionaires produced each year then in
any other country. At the same time the Middle Class is on the decline
due to inflation risks, the loss of manufacturing and the effects of
globalization. The top 1% of the country has 38% of the net worth in
the country while the bottom 50% have less than 5% of the net worth. The
huge disparities in the economy show that the wealthy are becoming
richer and much of the rest of the country is becoming poorer. As
inflation raises the income of the middle class is being eaten up. In
addition, the middle class which doesn’t have access to millions of
dollars can’t open up stores, businesses and other money making
propositions. The new tax bill makes sense when we consider
that the wealthy have an unfair advantage and own a major percentage of
the economy’s wealth. Therefore, the wealthy are simply paying more of
their fair share and can’t hide behind offshore accounts, tax breaks
and their government influence to skip on their responsibilities.

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