Federal tax and budget
Taxes, spending and the deficit will likely dominate nearly every discussion in Washington for the remainder of 2012 as Congress and President Obama wrangle over how strengthen a struggling economy while also securing the country's fiscal house.
Listed below are a variety of resources that define the issues facing our country's leaders with analysis of how potential changes would affect low- and middle-class families. Check back regularly for updates and further analysis.
Analysis of 2012 Federal Tax Reform, Part One: Proposed Federal Tax Plans Vary on Tax Equity
Tax rates, spending cuts and the federal deficit are again the center of debate on Capitol Hill. With the Bush-era tax cuts set to expire at the end of 2012, budget discussions will be the major focus over the next couple of months as the American economy continues its fragile course to recovery.
Diverse perspectives in Congress have resulted in several fiscal reform plans, all containing vast and varying implications for American families. These tax packages range from simply extending all Bush tax cuts to letting them all expire, with the most popular plans picking and choosing parts of the Bush-era cuts to remain intact or lapse at the end of 2012.
This COFPI report focuses on how proposed tax rate reductions, specifically the expiration of the Bush tax cuts, will impact different income groups and the overall progressivity of the tax system.
Misguided “Fiscal Cliff” Fears Pose Challenges to Productive Budget Negotiations
This report from the Center on Budget and Policy Priorities rebuts the erroneous assumption that there will be a “fiscal cliff” if budget decisions are not made by Congress before the close of the year. The Congressional Budget Office released a report that has led many to believe that there will be a steep economic decline on January 1, 2013 if budget decisions are not made and various income and payroll tax cuts expire. This report discusses the reality of the fiscal cliff and provides a differing perspective on the economic implications of a lame duck session.
How Tax Reform Could Become a Trap
This report from the Center on Budget and Policy Priorities explores how tax reform could impact the economy. With the Bush tax cuts set to expire, this report calls for prudent tax reform decisions from Congress. If policymakers are not careful in selecting a tax reform package, the result could be detrimental to the economy, the deficit and the overall equity of the tax system.
Raising Threshold for Bush Tax Cuts from $250,000 to $1 Million Would Lose $366 Billion — Nearly Half the Revenue
House Minority Leader Nancy Pelosi's proposal to extend President Bush's income tax cuts for households making up to $1 million, rather than $250,000, would lose $366 billion in revenue, according to this report from the Center on Budget and Policy Priorities. The Joint Committee on Taxation found that this policy change would reduce potential new revenue by $366 billion over the coming decade. This report points out negative consequences of forgoing this revenue and the benefits of the additional revenue in the federal budget.
The Bush Tax Cuts: President Obama's Approach vs. Congressional Republicans' Approach
This report by the Citizens for Tax Justice explores the differences between the Congressional Republican’s proposed tax reform package and the President’s proposed tax reform package. The report makes a side-by-side comparison of the differing extensions of the Bush tax cuts and breaks down the results of each tax package by income group. The website also includes state-by-state data about both packages.