Mostly rational politics, with occasional rants about how a few crazy Republicans are ruining the country.
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Thursday, April 13, 2006
Don't let Republicans spin you on tax revenues
This article makes the important and aptly-timed point that tax revenues will be up this Spring, and that while George Bush and Republicans will claim proof of their supply-side theory that lower tax rates lead to economic growth and therefore higher tax revenue, in fact the opposite is true. Tax revenues are higher because the Alternative Minimum Tax (AMT) is ensnaring more and more tax payers (including me this year). The AMT imposes a second test on taxpayers, and basically negates the effect of property, state and other tax deductions on one's federal return. It's basically a tax on people who live in blue states, but that's a topic for another post. So it is in fact higher tax rates causing the higher revenues.
Personally, I'm hoping Congress gets around to fixing the AMT this summer. Otherwise my $3000 tax credit for buying a Prius will evaporate.