The Taxman Cometh!!!!
Don’t we all feel this way around April 15th?
Well, Obama came out with his budget and his plan for tax revenue. A quick look over the list looks like he is planning on letting those who make over $250,000 take the hit. You know I keep hearing how this will impact small businesses, which actually employ the greatest number of people. Then, he has decided that this select group of people should not be allowed to have itemized deductions, while if you make $249,999, you will be able to itemize. I know for me who makes way under that amount, the only reason I itemize is because of a mortgage. So, I would think that is one of the largest line items that is itemized. So, what will that do to the housing market. Why pay out a bunch of money for a house if you don’t get a tax benefit. Oh, and other items that are itemized are state and local taxes that are paid, including property taxes! Will they lose the benefit of not paying tax on money that was used to pay taxes? Oh, and what will this do to nonprofit agencies. You know the organizations that pretty much survive because of donations they receive, much of which is from people who earn over $250,000 a year. If they can’t get a tax benefit from donations, how will that affect donations? Years ago I did a paper on flat tax and one of the disadvantages that was predicted with a flat tax was that it would reduce the amount of donations that nonprofits received. So, just with a quick look at an article, I see that the housing market could be impacted as well as nonprofits will probably lose donations. Oh, and I did hear on the tv this morning that people are saying that they will just lower their two income families to one income so that they don’t have to pay the higher taxes. In other words, they will earn less to pay less taxes and thus have less money to spend in the economy.
If you don’t think that you will be impacted just look at the taxes he is proposing for big businesses, and probably small as well. I see gas prices skyrocketing. Oh, and in case you didn’t know, he has stopped shale oil development in the United States.
But, I think this post I wrote a while ago really says a bunch about actual revenues from businesses. Taxes on Businesses
Remember they pay taxes on revenues, you know money that they make from consumers! At some point a company will provide you with a product that includes the cost of taxes for all the companies that are involved in creating (and selling) that product for you.
Updated to add a link to this post that talks about the article in the Wall Street Journal about how much money it would really take to support Obama’s plans. Also, I wish anyone who is familiar enough with tax laws would talk about double taxation. I faintly remember it but not enough to write about it.