The more money you make, the more the government takes from you. Families earning more than $250,000 are considered well off and are in the 35% tax bracket. Soon the bracket is expected to increase to 39%. Somebody has to pay for all the debt our country is in; apparently government has decided that somebody is a family making more than $250,000 a year.
Why not cut spending? This is the question on many individual’s minds. The national debt continues to rise and tax payers are paying the price. The Tax Policy Center found, in order to reduce deficit, about half a trillion dollars a year would need to be accumulated. Half a trillion is near the amount spent on the new Medicare program yearly. About $2,250 is expected from each family with an income of $500,000.
If the main goal is to get out of debt by tax payer monies, those in the 33% and 34% brackets will have to pay around 72.4% and 76.8% in order to reach the goal. This is only going to make the situation worse. Spending cuts and tax increases together might be a better way to go, instead of putting all the pressure the people. A value-added tax (VAT) is another plan that might find its way into the system.
Taking away tax breaks from major corporations might decrease the competition with their overseas rivals. When taking away tax breaks cross-border companies might have the upper hand compared with American companies. Retailers are also concerned and are against VAT because consumers will be less willing to spend.
Republicans believe that almost half of American families are not paying their income taxes. This weakens the economy and causes many to pay way more than others. Tax breaks and exemptions that once existed might no longer be available, which means more will go towards paying taxes. The longer the government waits to address this issues the tougher the problem will become.
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