What's wrong with the Tax System?

John Irons presents a quality Post which should be closely read to understand that the Bush Tax Cuts basically did more to cut the progressivity of the Income Tax, than it did to actually bring Tax relief to burdened Taxpayers. Actual Tax payment by percentage favored the top 20% of Incomes with Tax share reduction, The middle Incomes paid an increasing Tax share by percentage through all these years, while the bottom Incomes were forced to pony up an increased Tax share from 1996. Denials will state that overall Tax payments went down (this means that less was collected), but did Anyone notice that the National Debt went up drastically (I await the specific percentage rise of the National Debt over the two George W. Bush terms as he leaves office; this is not to say the Democrats were not as irresponsible as Republicans).

Someone asked what my major complaints were against the current Federal Tax system?

Now the Tax policy Economist in me comes to the surface. Business Tax credits for investment jars my nerves, as they stand as sheer Tax escape; Business should invest in worthwhile investments established to show a Profit, not for a hidden Tax loophole to blend high-Profits division with mediocre Profit divisions of inflated-Costs Production facilities employing little labor or producing effectively desired Product. I detest Tax Accounting procedures which allow double-exemptions and massive Tax shifting forward or backwards in time. I cannot express my contempt for Tax credits allowed for foreign Investments which allow for permanent Tax escape. Why should American industry be granted Tax credits for off-shoring their Production with the entailed loss of tax-paying American Jobs?

The famous Mortgage Tax credit has led to ridiculous House pricing, while We are currently developing a wide set of Tax losses by purported losers in Capital. This Tax credit incited Inflation not only in the Housing market (leaving the Poor even further away from adequate Housing), but created a real Debtor nation of Incomes who cannot effectively pay off the mortgages obtained except by selling their Homes for reduced Price–all to chase the wondrous Tax credit. More Households, today, lay claim to two or more homes than ever before; many cannot pay off even one. How many Couples with Two Incomes, combined to less than $100000, enjoy Housing (and Mortgage payments) in the $1 million Housing range?

I often ask myself what I am doing in this land of Plenty; but then, I recognize I will hit the bottom after Most. Many would allege that it is the irresponsibility of American Consumers at fault. I must insist it is a Tax Code which awards only Debtors. Happy Thanksgiving! lgl