28 December 2004
Republicans: 'Our tax reform is sure to be unpopular'
At least, that the message I get from their decision to kick tax "reform" down the road to late 2006 (warning: evil, soul-sucking "free registration" required; use BugMeNot):
Wholesale changes to the tax code that just weeks ago were identified as a Bush administration goal by the end of 2005 are being pushed back for at least another year.Unless they know their tax "reform" would kill them in midterm elections, I see no reason for them to postpone the changes. This seems likely when you look at what's included in even their least drastic plan, "Option 5":
- eliminates the top two tax brackets
- makes employee health insurance taxable
- "immediate write-off for business plant and equipment purchases[, which] could reduce the tax burden on profitable companies so much that they would end up receiving tax refunds"
- eliminates deduction of state and local taxes
- taxes "most Social Security benefits" as income
They could sell the elimination of the 35% and 28% brackets as going together with the elimination of the AMT and call it a middle class tax cut, but taxing health insurance, making tax rates on highly profitable corporations effectively negative, taxing people on their state and local taxes, and cutting Social Security benefits are all going to be hard to market.