Tax Rebates Are Unfair to the Poor?

The BBQ Pit
1

I’m not against income taxes, or even progressive income taxes.

But I can’t stand it when people criticize tax reductions and/or rebates as “unfair to the poor,” on the theory that such reductions only benefit the rich.

Why? Think about it - the reason people with lower incomes don’t benefit from tax reductions is that they don’t pay much tax in the first place. I agree that poor people shouldn’t have to pay as much in taxes, and I’m not troubled at all that they are subsidized by the wealthy. But, if taxes are cut (for whatever reason) how in the world is that unfair to people who aren’t paying as much in taxes?

Look, if you think that taxes should be raised on the wealthy, and more money spent on the poor, just say so, and maybe I’ll agree with you (depending on how the money is to be spent).

But these arguments that tax cuts are unfair to the poor since they disproportionately help the rich annoy me.

2

It’s called a “rebate” for a reason. A rebate is:
from Dictionary.com
“a refund of some fraction of the amount paid”

So, no pay, no rebate. I don’t see what the issue is. I’m sick of hearing the “No fair!” cry, too.

Zette

3

Well . . .

x dollars is a much greater percentage of Joe Bluecollar’s income than Joe Millionaire’s.

4

Zette is right on. This isn’t “tax relief for the poor” it’s a rebate. If you paid only a little bit in, no reason why you should get more than a little bit back.

I understand that the benefit of said tax rebate may be bigger to those with the lowest income–it might represent a doubling of their biweekly income, for example. But that’s just math. It’s not what I understand the concept “rebate” to mean.

Here’s why we’re crying in the House of Cranky: we’ve had very uneven income over the past few years. Big bucks in the form of a lump-sum buyout a few years back and since then we’ve lived on savings. That means we paid huge, ugly, more-than-I’ll-ever-earn-in-a-year taxes once, whereas now our income is piddling and so are our taxes.

If I had to have that environment-wrecking tax-slashing buffoon in my White House, why oh why couldn’t it have been in our flush year?!?

5

‘Cuz you voted fer Clinton? That might have something to do with it. Sheesh, quitcher whinin’ about getting what ya asked for.

6

If we give rebates to people who didn’t pay tax, why include only Americans? There’s enough rebate money available to give each person in the world about $5 (excluding postage.)

7

Another bone to pick:

I frequently hear conservatives complaining about a so-called “entitlement mentality.”

Honestly, I am skeptical of these complaints – let’s face it, we all feel (at some level) that we’re entitled to certain goodies.

But when I see stuff like this, it makes me wonder:

(emphasis mine)

Umm, excuse me, but exactly why were you counting on a rebate?

I think it’s proper and wonderful that people with low incomes should pay very little in taxes, and still enjoy our nation’s roads, parks, etc. And if the government were to decide to send everyone a few (unexpected) bucks, even those who pay little in taxes, I wouldn’t have a conniption over it.

But why anyone should count on such a windfall is beyond me.

Now, granted the above quote is just from a congressman who’s posturing a little. But it’s still annoying.

8

What the fuck are you people talking about?

Yeah, it’s a rebate this year, but what it really is is a reduction in the percentage paid. Rich folk win two ways: they get a larger percentage reduction, and as part and parcel of that they also get a shitload more disposable income.

Even though its just a small percentage change, what Georgie just did was he unloaded a huge dollar amount of the tax burden onto the middle class, the people who make less fucking money, the vast majority of the readers here. The average joe will be paying a larger proportion of the tax dollars the U.S. takes in than they were before, and getting less government service for it. And when taxes go up again–and they will–they will continue paying more for less.

We get fewer services, lower quality, and a pittance, while the people who can afford to pay get [ul]more fucking money[/ul]. More fucking money to hire accountants to hide their assets from the government and more fucking money to purchase political influence, which is how we all just got ass-raped in the first place.

Oh, yeah. And this bullshit idea was sold to you in part because it will “encourage savings.” Yeppers. That two hundred bucks you get back, properly saved and adjusted for inflation, might be worth three hundred bucks by the time you retire. Congrat-u-fucking-lations. In the meantime, Biff and Muffy just got back a Porsche, and by retirement time, adjusted for inflation, it’s going to be a Ferrari, which they can drive on highways they will pay less for than they once did.

I’m sure as hell putting the bone thrown to me in to savings. I’m going to save the environment by giving fifty bucks to Greenpeace, I’m going to save people dying of AIDS by sponsoring a rider in the next ride, I’m going to save a woman’s right to choose by donating to the best lobbying group I can find, and I’m going to save the democratic process by donating to the Democratic party. Why? Because my fucking government sure as hell can’t be trusted to do any of those things right now.

9

Anybody else picture him banging his shoe on the table during that?

10

I will bury you!

11

This would be really funny, if not so scary.

12

Yeah, I might have been showing a little too much of my red back and my yellow belly there, Anthracite. Consider that last paragraph to be stricken–it’s really not relevant to this subject, anyway.

I shouldn’t be bothering with this, but it really, really steams me to see people getting screwed over and not even realizing it. This is the Leprechaun joke come to life.

What? You’ve never heard the Leprechaun joke? Bear with me a minute.

A guy walks into a public bathroom and steps up to the urinal. At the next urinal a little man in a green suit and hat steps up, unzips his pants, and whips out an enormous phallus.

The guy looks over, sees this little man in green holding his crank in both hands and says, “holy shit!”

“What, ya never seen a crank this long before laddie? I can give you one, too. I’m a Leprechaun,” says the little man.

“You’re serious, aren’t you?” says the guy.

“Sure, but you have to do something for me before I do,” says the little man, gesturing at the stall.

A minute later, the guy has his pants around his ankles and the little man is standing on the toilet giving him the reaming of his life.

“What’s your name, laddie?” asks the little man.

“AAH! Kevin!”

“And how old are you, Kevin?” asks the little man.

“Shit! I’m twenty-one!”

“Well, Kevin, don’t you think you’re a little old to be believin’ in Leprechauns?”

That’s exactly what Bush just did to most of us with his “tax relief”. Most of us are going to pay a few hundred bucks less, while the very most wealthy people out there are going to pay thousands, or even tens or hundreds of thousands less. Okay, they earned it. Fine.

In the meantime, gas prices are high again. What percentage of your income goes to paying the percentage tax on that gasoline? What percentage of Poppy Bush’s income goes to paying the percentage tax on that gasoline?

Same goes for heating oil, water and electricity, increased taxi and bus fares, the blown suspension on your car that you have replace because you have to drive on shitty roads because transportation funds are being cut. Mark my words: by cutting government services, everyone’s cost of living is going to increase. But that increase will be negligible to the wealthiest people.

Before Ron Reagan came to town, wealthy people were bitching because they were paying fifty percent of their income above a certain dollar amount in taxes while all the rest of us were paying half of that. Well, why the fuck aren’t we middle class folks indignant because we pay twenty percent of our income in flat taxes while wealthy people pay virtually none?

And why aren’t all of you out there livid that this was spoon-fed to you as “relief”?

You don’t still believe in Leprechauns, do you?

13

Um, Sofa?

How much do “the rich” pay in taxes?

Or is that irrelevant to this discussion?

Shouldn’t any sort of tax relief, which both Democrats and Republicans agree is appropriate, in the trillions of dollars, include those who are providing much of the excess?

Sorry. I get a little queasy when the wealth redistribution gets too zealous. Even if that means those evil rich people benefit. I’m one of those Americans whose idea of “fairness” differs a bit from yours.

14

Sofa King is exactly right. Not only the poor (a percentage of whom will receive not tax relief whatsoever under Bush’s plan) but also the middle class have been reamed by Bush and Co. Most of us non-rich-folk pay a large percentage of our incomes in sales tax and payroll tax. These are pittances to the wealthiest. The worst part of it is is that tax relief in the form of a payroll tax cut, which would have been fairer to the poor and middle-class, would have been better for the economy. So what is the justification for a taxcut that disproportionately benefits the richest one percent?

To the videotape…

First, some basic figures:

“A detailed analysis of the whole $1.6 trillion tax cut, as done by the Citizens for Tax Justice, shows that 43% of it would wind up in the hands of the richest 1% of taxpayers: those with an average income of $915,000 would get an average tax cut of $46,000 a year. For the bottom 60% of taxpayers (income less than $39,000), the average tax cut would be $227.”

Source:
http://www.alternet.org/story.html?StoryID=10471

On the justification question:

“If one in five children were not living in poverty; if a million eligible children were not denied Head Start; if 44 million Americans – 11 million of them children – were not without health insurance; if educational opportunity were more equitably distributed; if opportunities for meaningful employment were available to all those seeking jobs; and if our older citizens never had to choose whether to buy food or their medicines; then, perhaps, a government could afford to return some money even to the rich. But none of these conditions has been achieved.”

Source:
http://www.tompaine.com/features/2001/04/09/2.html
Here is an excerpt from a column by an economist who supports a different kind of tax reform. He asks,

“Is it possible to shift more of the tax burden to the high-end families, the big winners in the new economy, so that middle-class families pay less?
The answer to this question is yes, and the tax change would actually be good for the economy. A small tax on financial transactions, such as the buying or selling of shares of stock, could raise a large amount of revenue, which could be used to reduce income taxes for low- and middle-income workers. A tax of only one-quarter of 1 percent on each purchase or sale of a share of stock could raise more than $ 100 billion a year in revenue. This would be enough to reduce the income tax for a typical family by close to 40 percent.”

Source:
http://www.cepr.net/tax_freedom2.htm

And here is an excerpt from an article that contrasts the discrepancy between the average-Joe family benefit that Bush pushed in the media (the Hagens of South Dakota), and the benefit to Bush and his own cabinet members.

“It is clear, however, that the Hagen family of South Dakota, eager for a $1,500 tax break, will reap far less than those running the government. At last year’s income levels, Rumsfeld would have saved at least 393 times as much as the Hagens, and Bush would have saved about fifteen times as much, or $23,000. Meanwhile, the median American family with children will get by this year on an estimated before-tax income of $45,600. At the rally in South Dakota, Bush did his best to minimize this divide with a scripted expression of empathy. “$1,500 may not be a lot to some,” he told the crowd. “It means a lot to the Hagens.” One can only guess what a total tax savings of at least $88.3 million would mean to Bush and fifteen of his closest advisers.”

Source:
http://www.thenation.com/doc.mhtml?i=20010625&s=scherer

As I see it, anyone who thinks this tax cut is up to snuff is either very rich, or loves the cool excitement of being fleeced.

15

The OP misunderstood his quote. That senator is not saying the tax cut plan is unfair because the rich get back proportionately more money, what he said was that many lower middle class people get no rebate at all, like Mandelstam is talking about.

So, both Democrats and Republicans support a tax cut. Whoop de fuckin doo-- what did you expect, the Dems were gonna go all out to stop something that was gonna happen anyway? Facing a split Senate and Republican House (not to mention the president), it’s not as if they could take up a position against the cut. Give me a break.

16

Mandlestam - Anyone who brings up “the richest 1 percent” without bringing up what percentage of the tax the richest 1 percent PAY gets instantly discredited. Ask Al.

WL -

**
What?

So, your premise is, the Democrats don’t really believe in a tax cut, they were just powerless?

Not giving them much credit for the courage of their convictions, are you?

17

Preface: When I’m with my friends, I like to pretend that I am more knowledgeable than I actually am, and it usually works. I already know that kind of thing doesn’t fly here at the Dope and so I try to resist the temptation. That’s why I kept my last post short. Glad to get that off my chest.

Milossarian

  1. “Anyone who brings up “the richest 1 percent” without bringing up what percentage of the tax the richest 1 percent PAY gets instantly discredited.” I’ll go you one better and ask you to submit for review what percent of the wealth of this nation is in the hands of that richest 1 percent. Compare that to the percentage of the taxes that they pay, and let’s see what we see.

  2. I don’t pretend to know what the Democrats believe in. I know that had they been opposed to a tax cut, it would have mattered little in the long run. I know that the tax cut was Bush’s idea originally. I know that a tax cut wasn’t seriously considered with a Democrat in the Oval Office. Putting together what I know, I suspect that many, most, or perhaps only some Democrats that ended up supporting the cut did so only so that they could get it modified. Taking a hardline stance against a tax cut would have been ineffective and self-destructive, whereas if they “supported” it, they could get a word in edgewise about its structure and implementation. People who trumpet around the fact that since both parties participate in a discussion of a proposal, it must naturally be a great idea, seem to me to be thinking in a simpleminded fashion and in ignorance of the realities of politics.

  3. As far as: “Not giving them much credit for the courage of their convictions, are you?” In a word, no. Why would I?

18

As if the Republicans and Democrats represented the entire spectrum of possible opinions!

19

Bwahahahha! Americans complaining about gasoline taxes! Heehee! That’s like fish complaining that it’s too dry, or something equally ludicrous.

But gasoline taxes, and the mass addiction to a thoroughly inadequate means of transportation, are best reserved for another thread :wink:

Speaking of which, it’s offically tax-free day in Canada. Whatever :rolleyes:

20

From the IRS webpage:

Forgetting the tax reduction part of the OP and focusing just on the rebate, even the richest one percent of the people in this country will only get 300 bucks.

And as for rebates if you didn’t pay taxes, then you shouldn’t get a cheque. Would you expect a rebate for a car you didn’t buy? But think of it this way: The people who didn’t pay taxes are getting a rebate of .05% of the taxes they paid. .05% * $0 = $0.