About these tax-day tea parties: It's obviously fine if citizens want to exercise their first amendment rights and hold protests. Admirable, even. And if these protests are underwritten by corporate backers or supported by various media organizations (there seems to be some debate about this), that's OK too. First Amendment rights all round! But what I don't understand is why these rallies are being held to protest, among other things, "higher taxes." (Higher spending is another matter.) There is a widespread perception that Obama is raising taxes willy nilly, so maybe this is worth clearing up. As far as I know, there are five individual tax provisions in the
president's budget that could be described as a tax increase. So yes,
there will be some higher taxes. What's confusing to me is that the
vast majority of these taxes affect only those households with an
annual income of greater than $250,000. And the vast majority of these
increases would have happened anyway if the Bush tax cuts were allowed
to expire on schedule.
But let's go through them one by one. The five tax increases that I see are:
1. Eliminating the Advance Earned Income Tax Credit. This isn't a proposal to eliminate the EITC -- it's just a proposal to eliminate a particular way of claiming the EITC that is extremely complicated, that almost no one uses, and that leads to a high level of tax error. As far as I know, eliminating this is not controversial.