Millionaire’s tax — why it’s needed

Albany Times Union Editor Rex Smith wrote a great column in Sunday’s paper detailing why a millionaire’s tax would provide a fairer and more equitable tax rate for middle class tax payers. Read an excerpt below:

If the decision about the property tax cap was about fairness for taxpayers, the next fight may be defined as one about justice for schoolchildren.

Under law, New York’s top income tax rate, 6.85 percent, applies to everybody who earns more than $40,000 a year. But in 2009, in the aftershock of the great recession, the rate for people with incomes above $200,000 was temporarily hiked to 8.97 percent … if a true “millionaire’s tax” is maintained on that smaller group, the built-in budget deficit will vanish. School aid could be set at the level promised in the two-year plan passed a few weeks ago. And, importantly, the state’s taxes would be more progressive.”

Read the entire story at: http://www.timesunion.com/default/article/It-s-the-talk-of-the-donut-shop-1400557.php#ixzz1NwNkFmDy

One Comment

  1. Betsy Sandberg May 31, 2011 at 1:46 pm #

    Keep in mind, over the past four decades, tax rates on the very rich have plummeted. Between the end of World War II and 1980, the top tax bracket remained over 70 percent — and even after deductions and credits was well over 50 percent. Now it’s 36 percent. As recently as the late 1980s, the capital gains rate was 35 percent. Now it’s 15 percent.

    Not only are rates lower now, but loopholes are bigger. 18,000 households earning more than a half-million dollars last year paid no income taxes at all. In recent years, according to the IRS, the richest 400 Americans have paid only 18 percent of their total incomes in federal income taxes. Billionaire hedge-fund and private-equity managers are allowed to treat much of their incomes as capital gains (again, at 15 percent).

    Here’s another fact. In the late 1970s, the top 1 percent took home 9 percent of total national income. Now the top 1 percent’s take is more than 20 percent. Over the same period, the top one-tenth of one percent has TRIPLED its share.

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