http://www.statesman.com/business/conte ... 21050.htmlBush's vision of 'ownership society' will drive tax reform
Bush long has made it clear he wants to restructure the tax system to promote an "ownership society" that encourages millions of average Americans to own property and financial securities.
Bush, thinks this share-the-wealth :lol: vision will make workers more financially secure and at the same time create new pools of capital that will fund economic expansion and job creation.
The main options: creating a national sales tax that would shift the tax burden from income to consumption, shifting toward a flatter tax that would squeeze tax rates into a lower, narrower range while eliminating many deductions.
While his emphasis has been on permanently lowering rates for everyone who pays income tax, his ownership agenda has led to favorable treatment of income from capital gains and stock dividends.
The highest tax rate on capital gains, profits made from selling securities held longer than one year, typically is 15 percent, down from 20 percent previously. The top rate on most dividends is also 15 percent, less than half of the 35 percent top tax rate paid on ordinary income.
The ownership principle is also at work in Bush's pledge to permanently eliminate the estate tax.
And in his State of the Union speech this year, Bush backed tax breaks for people who want to save money for any purpose, not just for retirement or college tuition. He also called for expanding tax breaks for health care spending accounts.
Critics fear Bush's efforts will only shift taxes from the upper to the middle and lower classes, making life more comfortable for those who live off investments while increasing the burden on wage earners and consumers.
"They want to make it so that owners don't pay taxes, only people who have to earn their income," said Mark Weisbrot, co-director of the Center for Economic and Policy Research, which has criticized many Bush economic policies.
Other critics fear that while wealthier Americans know how to manage their savings, poorer ones will not be able to invest money as wisely, leaving them further behind.
Additionally, scandals at large financial services firms, including major Wall Street brokerages and mutual funds, raise questions about the ethical standards in the industry.
"If there was a need to raise taxes, I would say, 'Let's have a tax bill that raises taxes,' as opposed to, 'Let's simplify the tax code and sneak a tax increase on the people,' " he said.
[Poor Bush, he always spills the beans re: his true agenda. Most are just too dumb to realize]
Instead, he pledged that his tax reform plan will be "revenue neutral," meaning that it would not increase total revenues collected by the IRS, but would simply restructure the present tax burden.
marilyng@coxnews.com
