President Bush wants a broad-based tax cut. His plan would cut the top federal income tax rate to 33 percent, and the bottom rate from 15 percent to 10 percent, with other rate reductions in between. Over ten years. Big deal.
Rates shouldn't have been raised again after the 1981 Reagan tax cut anyhow. George W.'s father took the top rate from 28 percent to 31 percent -- the "read my lips" pledge violation that probably cost him the 1992 election. Then his successor, who ran on a middle-class tax cut, increased the rate to 39.6 percent.
That'll teach us ... something.
The present President Bush's plan also includes a gradual reduction in the marriage penalty and a gradual repeal of the estate tax.
Let me see if I can recall a tax hike that was gradual. Nope.
Why do we have a penalty on marriage? Whose bright idea was that?
I don't have an estate, but if I did I'd want to leave it to my grandchildren. I like them better than I like the government. But I'm not sure I'd have the expertise to avoid the death tax the way really rich people do.
There are many arguments for a federal tax cut. The government has apparently funded everything it considers an essential service, and paid off whatever debt it intends to pay off, or it wouldn't say that it's running "a surplus." The government has no right to take an unnecessary amount of tax dollars from taxpayers, many of whom do not have "a
Also, Alan Greenspan thinks that a rate cut will be good for the economy; or that it won't be bad for the economy, it's hard to tell which. Either way, it's our money and we should be allowed to keep more of it.
That's my opinion. But for those who disagree, I have one question: What's life without choice?
I heard that question in a television ad supporting abortion rights: What's life without choice? And I thought, that could apply to a lot of things, including tax rates.
Congress should offer a choice of rates on the federal income tax form -- the existing rates or the lower rates proposed by President Bush. This would model the 2001 federal tax cut after the Citizens for Limited Taxation bill that was filed here in Massachusetts after the voters chose Question 4 in November. If CLT's voluntary optional tax rate passes, each taxpayer will choose to pay either the phased down rates approved by the voters, or the higher rate that would exist if Question 4 had not prevailed.
Working people could opt to pay 5.75 percent of their income to the state this year, and 5.7 percent thereafter. Or they can take advantage of the income tax rate rollback and pay 5.6 percent this year, 5.3 percent next year, and 5 percent thereafter.
A similar decision about federal rates would give taxpayers lots more choices. For instance, instead of forcing lower taxes on people who don't want a tax cut, the government could let them continue to fund their choice of corporate welfare or environmentally harmful projects from the latest "Green Scissors report," released this month by a broad coalition of consumer, environmental and taxpayer groups. Generous taxpayers could continue to pay for mohair, cotton, peanut and tobacco subsidies, losing timber sales, or something called a "Yazoo pump" in Mississippi. Or they might want to continue subsidizing nuclear power plant insurance that the power companies can't afford themselves. Or they could fund artificial beach control. (What's an artificial beach?)
The rest of us could do whatever we wanted with our tax break. We could save (for college, a wedding, down payment on a home, a safer car, that dream vacation, retirement, a stay in a nursing home); invest (in stocks, bonds, a small business); give money away (to family members, sick friend, neighbor that lost home in a fire, medical research, veterans' services, scholarship for a poor child, shelters for abused women, unwanted teenagers, or abandoned pets).
And of course there's an endless list of things on which to spend the tax savings -- utility bills, replacement of a leaky roof, bifocals, visit to grandparents, Disneyland with the grandkids, a new pet, rose bushes, rowboat, YMCA membership, piano lessons, unpaid leave to care for a new baby or elderly parents. We could buy a mohair sweater, cotton shirt, or bags of peanuts. We could vacation on an artificial beach!
Wealthy estate owners could will their property to the federal, state or local government if they wanted. Married couples could still pay extra income taxes if it makes them happy.
But some of us might even want to adopt a child, or perhaps, chip in for another airing of the television ad which asks the question "What's life without choice?"
I choose a federal tax cut. That's life.