This article in The Sunday Times by Edmund L. Andrews is an excellent report on how there are built in hidden measures that can pass the burden of Bush's tax cuts and deficits to the middle class. While Bush stuffs his iron clad tax cuts for the wealthy down our throats, there is lots of room in the tax code to pass the burden to the hard working professional and trades people of this country.
Excerpts from the article below the fold
CYNICS have long predicted that the Bush administration, plagued by budget deficits, will eventually start raising taxes. But now it is becoming clear how it would do so: the alternative minimum tax.
Baffling in its complexity and often bizarre in its impact, the alternative minimum tax is a giant undeclared tax increase that will ensnare tens of millions of moderate-income families in the next several years.
It was created in 1969 to prevent the very rich from using tax deductions to avoid paying a fair share of taxes. But when the deadline for filing income tax returns arrives on Friday, the alternative minimum tax will require 2.9 million families to pay an average of about $6,000 more than what they would owe under traditional calculations
That is just the start. If current law remains unchanged, the alternative minimum tax is expected to wring an extra $33.9 billion from 18 million households in 2006. In 2010, it will rake in an additional $100 billion, and by 2015 an extra $200 billion.
The Article goes on to say that Bush has ordered a bipartisan panel to fix the alternative tax situation, but he is insisting that the panel can only come up with a solution that is "revenue neutral", with no loss of the extra tax money that would be generated by the alternative minimum tax code as it is now and that the solution works under the assumption that his tax cuts are made permanent. In other words, we will see some report and solution with more double speak, but in the end the middle class will assume the burden for Bush's deficits and tax cuts through higher taxes. One of the solutions they are batting around would be eliminating the deduction of State and local taxes from your Federal tax.
Tax experts have long complained that the alternative minimum tax is a "stealth tax increase," one that Congress never intended and that is likely to catch millions of taxpayers by surprise. But a tax increase through tax reform could be even stealthier. If the alternative tax is reduced, the offsetting revenue increases are likely to be buried in so many other changes that most people would never know what hit them.
So what else is new? During this whole republican coup, most people don't know what hit them.
The article goes on to explain how the Alternative minimum tax works and how as time goes on it will bring higher increases to working families. This year alone 2.9 million families will be paying an average of $6,000 more in taxes. Under current code this amount will increase expeditiously every year to include millions of more households paying billions of dollars more in taxes.
The Whole article is a good read and an excellent bullietin to us working stiffs http://www.nytimes.com/2005/04/10/business/yourmoney/10view.html?ex=1113364800&en=d0d6944d27793a
d1&ei=5070 (sorry it didn't work when I tried to embed)
Working tax payers beware!