**Written by Doug Powers
A couple of days ago I advised the pro “tax the rich” crowd to put away the party hats and kazoos after the fiscal cliff deal passed, because middle class taxes would still be going up. Not only that, but according to the Tax Policy Center, as a percentage, people earning between $30k and $200k will be taking a bigger tax hit than those making between $200k and $500k:
Earners in the latter group [$200,000-$500,000] will pay an average 1.3 percent more – or an additional $2,711 – in taxes this year, while workers making between $30,000 and $200,000 will see their paychecks shrink by as much as 1.7 percent – or up to $1,784 – the D.C.-based think tank reported.
Overall, nearly 80 percent of households will pay more money to the federal government as a result of the fiscal cliff deal.
‘The economy needs a stimulus, but under the agreement, taxes will go up in 2013 relative to 2012 – not only on high-income households, as widely discussed, but also on every working man and woman in the country, via the end of the payroll tax cut,’ said William G. Gale, co-director of the Tax Policy Center.
‘For most households, the payroll tax takes a far bigger bite than the income tax does, and the payroll tax cut therefore – as [the Congressional Budget Office] and others have shown – was a more effective stimulus than income tax cuts were, because the payroll tax cuts hit lower in the income distribution and hence were more likely to be spent,’ he added.
According to Debbie Wasserman Schultz, the fiscal cliff deal that Autopen signed yesterday is “a big gift-wrapped present of certainty to the middle class” (notice how George W. Bush’s income tax cuts Dems said were “for the wealthy” have now morphed into Debbie’s “present of certainty” to the middle class).
What DWS didn’t mention was that, thanks to the schadenfreude stimulus included in the fiscal cliff deal, even Obama supporters are now realizing they’ve been duped into playing a role in The Incredible Shrinking Paycheck.
**Written by Doug Powers
Twitter @ThePowersThatBeblog comments powered by Disqus
November 20, 2014 08:25 PM by Doug Powers
November 19, 2014 07:59 AM by Doug Powers
November 18, 2014 07:24 PM by Doug Powers
Jonathan Gruber cashed in even more than previously thought; Update: And Obama JUST found out about all this
November 16, 2014 09:23 AM by Doug Powers
November 12, 2014 09:19 PM by Doug Powers