Thursday, October 25, 2007

Rangel proposes a 4% surcharge on those making over 200,000!

If the Democrats win the trifecta next year, expect this tax to become law. I can't see how this is a winning strategy. Do you really think you aren't paying enough in taxes? I hope the Republicans will use the fact that they are being up front about their tax and spend policy.

Rangel said the broader measure, which he has called the ``mother of all reforms,'' would contain a 4 percent tax-rate surcharge on adjusted gross income over $200,000 for married couples. The surcharge would rise to 4.6 percent for those with income of more than $500,000. In addition, households with income of more than $200,000 would have to pay rates as high as 19.6 percent on capital gains and dividends, instead of the current rate of 15 percent.

That provision alone would raise $831.7 billion, more than enough to cover the cost of eliminating the minimum tax, Rangel said.

The overhaul, which he said wouldn't be voted on this year, also lowers the corporate tax rate from 35 percent to 30.5 percent. To pay for that $363.84 billion tax cut, the proposal would repeal a special 32 percent tax rate for manufacturers and disallow the ``last-in, first-out'' accounting method that reduces taxes for businesses such as oil companies, wholesalers and automakers that hold inventory.