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Thread: Giving tax credits to people who pay no taxes?

  1. #1
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    Giving tax credits to people who pay no taxes?

    [url]http://money.cnn.com/2008/10/31/news/economy/taxes_welfare/index.htm[/url]

    [QUOTE][SIZE="6"]Are tax credits welfare?[/SIZE]

    [B][I]Under Barack Obama, more people who don't pay income tax would get checks from refundable tax credits. John McCain calls it an expansion of welfare.[/I][/B]

    By Tami Luhby, CNNMoney.com senior writer
    Last Updated: November 3, 2008: 8:25 AM ET

    NEW YORK (CNNMoney.com) -- Democratic presidential contender Barack Obama says his economic plan would offer a tax break to 95% of working Americans.

    John McCain, the Republican nominee, has another name for his rival's plan: government giveaway.

    The presidential campaigns are clashing over whether Obama's tax proposal, which would expand the ranks of those who pay no federal income tax but get a refund check, is akin to welfare.

    Obama's opponents, calling the proposal another step in his plan to redistribute wealth, are particularly angered that he would pay for the cuts by raising taxes on those earning more than $250,000.

    "Barack Obama's plan to raise taxes on some in order to give checks to others is not a tax cut; it's just another government giveaway," McCain said at a New Hampshire rally on Oct. 22.

    Obama supporters, however, say that those who would receive the tax breaks do support the government. All the refundable credits have either a work or community service requirement, his advisers say.

    "These pay people taxes - payroll taxes, gas taxes, property taxes, sales taxes, airline taxes and many others," said Austan Goolsbee, Obama's senior economic adviser. "They are workers. It is completely offensive to say giving them a tax cut on income taxes is welfare."

    Expanding refundable tax credits
    At issue is Obama's plan to greatly increase the number of refundable tax credits available to workers, students and homeowners. By making the credits refundable, those who owe no income tax would get money back from the federal government.

    The Democratic nominee's "making work pay" credit alone would give $500 to single filers earning less than $75,000 and $1,000 for couples making double that. It will eliminate the federal tax liability for 10 million low-income Americans, according to the campaign.

    Obama's other proposals - including expanding the refundable earned income tax credit and making the Child and Dependent Care Tax Credit refundable - would relieve another five million people of their income tax burden, experts said.

    The number of people who don't pay federal income tax has grown over the past two decades as the government has added tax incentives for college students, families with children and those saving for retirement, to name a few. Some 47 million filers, or 33%, don't pay taxes, according to the Tax Foundation.

    That number would grow by 16 million under the Obama plan, so 44% of filers would have no liability, the group said. Enacting the credits would cost the government more than $1.2 trillion in revenue over 10 years, according to the non-partisan Tax Policy Center.

    McCain, for his part, is also proposing a new refundable tax credit that would take 15 million people off the tax rolls, according to the Tax Foundation. His credit could only be used to cover the cost of health insurance premiums. His campaign says it wouldn't cost the government anything.

    Overall, Obama's tax package would cost $2.9 trillion, while all of McCain's tax proposals would cost $4.2 trillion, according to the Tax Policy Center.

    Raising taxes on the wealthier
    The Republicans oppose sending money without restrictions on its use to people who don't pay tax, said Douglas Holtz-Eakin, McCain's senior economic policy adviser. And the GOP doesn't like paying for it by increasing taxes on wealthier Americans, which they say is another example of Obama's ideological drive to redistribute wealth, he said.

    "It's pretty clear what's going on here," Holtz-Eakin said.

    Also, simply giving lower-income people tax refunds is not the best way to help them or the economy, said Bill Beach, director of the Center for Data Analysis for the Heritage Foundation, a conservative think-tank.

    "They want jobs and higher wages," he said. "They don't want checks."

    Making tax code fairer
    For the most part, the government enacts tax credits to encourage certain behavior. For instance, the Saver's Credit is designed to give low-income workers incentives to fund retirement accounts.

    Making tax credits refundable allows lower-income workers to take advantage of them, said Robert Greenstein, executive director of the left-leaning Center on Budget and Policy Priorities. Since many lower-income workers pay little or no tax, a non-refundable credit such as the Saver's Credit isn't much use to them. Obama wants to make the Saver's Credit refundable.

    "If you are a millionaire, you get the child care tax credit," he said. "But if you make $20,000, you are denied it because you don't make enough. It ends up going to the least needy."

    Obama supporters also take issue with the Republican view that the refundable credits would go to people who pay no tax. Those who don't pay income taxes still support their state and federal governments through payroll taxes for Social Security and Medicare, sales taxes, property taxes and gas taxes.

    "Most people pay more in Social Security taxes than in income taxes," said John Irons, research and policy director at the liberal Economic Policy Institute.

    First Published: November 3, 2008: 5:52 AM ET[/QUOTE]

  2. #2
    Yes, it's welfare, & the argument that it isn't holds no water...classic redistribution/socialism. Get ready for it bc it's coming. I'm almost looking fwd to it bc Republicans got too comfortable the past 8 years...there will be enormous buyers remorse after people really get to know Obama, & it'll be two years before we can do anything about it. Pray.

  3. #3
    well..giving tax refunds to people who don't pay income tax maybe...but not to people who don't pay taxes....

  4. #4
    [QUOTE=Tucker134;2840463]Yes, it's welfare, & the argument that it isn't holds no water...classic redistribution/socialism. Get ready for it bc it's coming. I'm almost looking fwd to it bc Republicans got too comfortable the past 8 years...there will be enormous buyers remorse after people really get to know Obama, & it'll be two years before we can do anything about it. Pray.[/QUOTE]

    well..I wonder what to call giving a tax cut to only a small select group of the tax paying community.

  5. #5
    Nobody who doesn't pay taxes is getting a tax credit. The people who get them will at least be paying payroll taxes --from their JOBS-- and in some cases will be paying greater percentages of their income in taxes than do many people who pay income taxes as well.

    It's a tax credit to a working person who badly needs it, not welfare by any definition.

  6. #6
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    It dos'nt matter, were screwed. How can you beat someone that says "vote for me and I'll give you money"???? The country has been overrun with lazy people. It's kind of like when they closed bars on election day so you couldn't buy a drunk's vote with a drink. Back then you had more ethical people in government that shut down that practice.

  7. #7
    [QUOTE=NEWNYJETS;2840562]It dos'nt matter, were screwed. How can you beat someone that says "vote for me and I'll give you money"???? The country has been overrun with lazy people. It's kind of like when they closed bars on election day so you couldn't buy a drunk's vote with a drink. Back then you had more ethical people in government that shut down that practice.[/QUOTE]

    McCain is offering tax cuts also. And tax cuts were the central plank of Bush's platform in 2000 --even promised to send people rebate checks as soon as he was offered. Do you characterize those the same way?

    Somehow, I doubt it.

  8. #8
    [QUOTE=nuu faaola;2840559]Nobody who doesn't pay taxes is getting a tax credit. The people who get them will at least be paying payroll taxes --from their JOBS-- and in some cases will be paying greater percentages of their income in taxes than do many people who pay income taxes as well.

    It's a tax credit to a working person who badly needs it, not welfare by any definition.[/QUOTE]

    How do you define welfare?

    It'd be extremely difficult for someone to pay ZERO income taxes and have a higher tax rate than someone who does pay income taxes.

  9. #9
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    [QUOTE=nuu faaola;2840559]Nobody who doesn't pay taxes is getting a tax credit. The people who get them will at least be paying payroll taxes --from their JOBS--[B] and in some cases will be paying greater percentages of their income in taxes than do many people who pay income taxes as well.[/B]

    It's a tax credit to a working person who badly needs it, not welfare by any definition.[/QUOTE]
    How so? Payroll tax is like 7.5%, everyone pays that to over 100k, and after that level you are in atleast a 25% tax bracket..

    Where do actual tax payers pay a lower rate then those who only play SS and Medicare?

  10. #10
    [QUOTE=CTM;2840572]How so? Payroll tax is like 7.5%, everyone pays that to over 100k, and after that level you are in atleast a 25% tax bracket..

    Where do actual tax payers pay a lower rate then those who only play SS and Medicare?[/QUOTE]
    It doesn't happen.

  11. #11
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    [QUOTE=nuu faaola;2840570]McCain is offering tax cuts also. And tax cuts were the central plank of Bush's platform in 2000 --even promised to send people rebate checks as soon as he was offered. Do you characterize those the same way?

    Somehow, I doubt it.[/QUOTE]

    Don't rember that check coming in the mail and yes, I would have been against it then as well. I'll earn my own money.

  12. #12
    [QUOTE=nuu faaola;2840570]McCain is offering tax cuts also.[/QUOTE]

    McCain would keep the tax rates the same.

  13. #13
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    [QUOTE=BrooklynBound;2840573]It doesn't happen.[/QUOTE]

    Yeah, kind of getting at that, but I think nuu has earned enough respect to explain his op before any bashing takes place ;)

  14. #14

    what do you call...................

    [QUOTE=jetstream23;2840439][url]http://money.cnn.com/2008/10/31/news/economy/taxes_welfare/index.htm[/url][/QUOTE]

    this last billion dollar credit we just gave out.........and for the last time, you racist f#@*&'s what do you call companies that havnt paid or filed their taxes in years, who are given a refund. the problem with you one way thinking neanderthals is that as long as it goes to white people you seem to have no problem with it. i dont understand this you can do what ever you want, just dont raise my taxes mentality. no bid contracts, companies giving large bonus' to incompetant officials, large bailouts to companies, officials who feel they can do anything they want, companies being subsidized by the government and lobbist funneling money to certain people all thats welfare, we just look over it because it goes to white people to keep them in power. name me one black or hispanic group in this bunch. and i dont want to bust anyones cherry, but when we give foreign aid or money to countries over seas, we have an inside person that we send the money to along with a list of companies and people to funnel that money right back here to. thats, welfare you jackass'...........................

  15. #15
    [QUOTE=kennesawjet;2840615]this last billion dollar credit we just gave out.........and for the last time, you racist f#@*&'s what do you call companies that havnt paid or filed their taxes in years, who are given a refund. the problem with you one way thinking neanderthals is that as long as it goes to white people you seem to have no problem with it. i dont understand this you can do what ever you want, just dont raise my taxes mentality. no bid contracts, companies giving large bonus' to incompetant officials, large bailouts to companies, officials who feel they can do anything they want, companies being subsidized by the government and lobbist funneling money to certain people all thats welfare, we just look over it because it goes to white people to keep them in power. name me one black or hispanic group in this bunch. and i dont want to bust anyones cherry, but when we give foreign aid or money to countries over seas, we have an inside person that we send the money to along with a list of companies and people to funnel that money right back here to. thats, welfare you jackass'...........................[/QUOTE]
    Playing the race card definitely helps your credibility.

  16. #16
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    [QUOTE=kennesawjet;2840615]this last billion dollar credit we just gave out.........and for the last time, you racist f#@*&'s what do you call companies that havnt paid or filed their taxes in years, who are given a refund. the problem with you one way thinking neanderthals is that as long as it goes to white people you seem to have no problem with it. i dont understand this you can do what ever you want, just dont raise my taxes mentality. no bid contracts, companies giving large bonus' to incompetant officials, large bailouts to companies, officials who feel they can do anything they want, companies being subsidized by the government and lobbist funneling money to certain people all thats welfare, we just look over it because it goes to white people to keep them in power. name me one black or hispanic group in this bunch. and i dont want to bust anyones cherry, but when we give foreign aid or money to countries over seas, we have an inside person that we send the money to along with a list of companies and people to funnel that money right back here to. thats, welfare you jackass'...........................[/QUOTE]

    wtf is this nonsense?

  17. #17
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    [QUOTE=kennesawjet;2840615]this last billion dollar credit we just gave out.........and for the last time, you racist f#@*&'s what do you call companies that havnt paid or filed their taxes in years, who are given a refund. the problem with you one way thinking neanderthals is that as long as it goes to white people you seem to have no problem with it. i dont understand this you can do what ever you want, just dont raise my taxes mentality. no bid contracts, companies giving large bonus' to incompetant officials, large bailouts to companies, officials who feel they can do anything they want, companies being subsidized by the government and lobbist funneling money to certain people all thats welfare, we just look over it because it goes to white people to keep them in power. name me one black or hispanic group in this bunch. and i dont want to bust anyones cherry, but when we give foreign aid or money to countries over seas, we have an inside person that we send the money to along with a list of companies and people to funnel that money right back here to. thats, welfare you jackass'...........................[/QUOTE]

    Very intelligent, well thought out post. Are you a Mensa candidate?

  18. #18
    [QUOTE=shevys;2840635]Very intelligent, well thought out post. Are you a Mensa candidate?[/QUOTE]

    [QUOTE=CTM;2840634]wtf is this nonsense?[/QUOTE]

    [QUOTE=BrooklynBound;2840619]Playing the race card definitely helps your credibility.[/QUOTE]

    funny, left-right-middle..doesn't matter on this forum...we can all agree when we recognize an idiot


    DOH! It's after midnight...Warfish's election day decree....hope I didn't cross the line!!!

  19. #19
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    [QUOTE=piney;2840643]funny, left-right-middle..doesn't matter on this forum...we can all agree when we recognize an idiot


    DOH! It's after midnight...Warfish's election day decree....hope I didn't cross the line!!![/QUOTE]

    It is funny...:P

    But equally as funny is how nobody answered the crux of his spittle laden rant. Why is corporate welfare excusable? Why is our government in the business of subsidizing private companies?

    What's good for the goose is good for the gander...

  20. #20
    [QUOTE=PlumberKhan;2840685]It is funny...:P

    But equally as funny is how nobody answered the crux of his spittle laden rant. Why is corporate welfare excusable? Why is our government in the business of subsidizing private companies?

    What's good for the goose is good for the gander...[/QUOTE]

    It's just as inexcusable.

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