There is another aspect which makes the raw numbers even more pernicious. Many of the new tax increases are a function of the taxpayer's overall income, such as caps on deductions for mortgage payments, state and local taxes, and charitable deductions, and the new 20-percent capitals gains tax bracket.
Tying these items to overall income creates uncertainty, since the value of the deductions and the cost of the capital gains will not be know until after the fact, when the taxpayer's total annual income is calculated.
For someone on a strict salary, that may not be a problem. But for business owners, entrepreneurs, and those who live off of commissions and bonuses, annual income can be difficult to predict. These new tax provisions will limit the ability to plan.
Additionally, these new provisions will punish people who have highly fluctuating annual incomes, typically business owners and investors. The lost deductions and the higher taxes in one year cannot be recouped in less prosperous years. That is a problem now, but it is even more so under the new budget.
Into our already byzantine tax code is introduced a more serious element of chaos than previously existed.
If I didn't know better, I would speculate that these tax provisions were designed by someone who didn't have a clue as to how the private sector operated, who never ran a business, and who never took an investment risk with his own money.
--------------------------------------------
Follow me on Twitter and Facebook
How may an ordinary tax paying citizen become John Galt?
ReplyDeleteDid you see this "withdrawn" Reuters article about backdoor taxes? Can't wait to see the final article, if it's ever allowed to be published...
ReplyDeleteConsidering only 8% of O's cabinet comes from the private section, it's not surprising.
ReplyDeleteOh, they know what they are doing. Driving more people into poverty or something close to that, putting more people on welfare or in government jobs. Killing off the chance for a new person to gain wealth without the prior approval of the new "royalty". Oh, they know exactly what they are doing.
ReplyDeletehttp://article.nationalreview.com/389050/liberal-views-belgian-brains/jonah-goldberg
You know for all the paranoids out there shouting "New World Order" since the Bush I administration, I think they can now say "I told you so" and not worry about being called nutjobs anymore.
But you have missed the point about the "freeze" on spending.... It is nothing more than a sleight of hand.. it is very small and will not take effect until 2011....
ReplyDeleteHere is something I ran across on Drudge-
ReplyDeletehttp://truthandcommonsense.com/2010/02/04/a-nice-note-from-the-irs-they-are-buying-combat-shotguns/
I picked this up on the Drudge report and needless to say I became a little queasy. I was just on the job when Waco and Ruby Ridge burned across the television. It was funny how our department was split between the "hut hut" guys (SWAT) and the regular cops who thought nothing justified assaulting a compound filled with children or shooting a mother in the head. As I said in my post, I support agents being able to protect themselves, but these weapons are not defensive, they are offensive, which begs the question who in the world does the IRS think they are going to have to shoot? Tax evaders? What happened to court filings, garnishing wages, etc.
As I said in my post. The last time we had a liberal democrat in office it didn't work out so well. I was hoping the lesson had been learned and remembered. Maybe I'm wrong.
I wonder what Victor Davis Hansen and other opinion makers has to say about this and Obama's determined effort to push THROUGH the citizens. Apparently using shotguns