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Monthly Archives: June 2013
Marginal tax rates redux
Today brings a reminder of the dangers of talking about income tax rates as if they applied to people rather than to portions of income (a subject we’ve covered before). Here is Wisconsin Assembly Speaker Robin Vos defending a proposal to cut rates in all five of Wisconsin’s income tax brackets, rather than only in the lowest three brackets:
The tax cuts for high earners are a concern for some Senate Republicans, Fitzgerald said. But Vos said he had no problem with them.
“I think everybody who pays income taxes deserves a tax cut,” he said.
Of course, cutting rates in the lowest three brackets does provide a tax cut for everyone who pays income taxes: high earners enjoy the same rate cut on the portions of their income that fall in the affected brackets. Vos’s statement—variations of which have become a core conservative talking point on tax policy—is carefully crafted to imply (but not entail) that this isn’t the case, and that high earners will be left out unless the top two brackets also see rate cuts. This move is facilitated by talking about tax rates as if they applied directly to people: by this fuzzy logic, no rate cut for the top two brackets means no rate cut for people in the top two brackets, and we are on the slippery slope to “class warfare”.
This kind of misleading talk about taxes is so ingrained that journalists apparently never think to challenge it. Vos’s statement closes a section in the AP article quoted above. Even the self-styled truth-tellers at Politifact indirectly quote, without comment, Wisconsin State Rep. Dale Kooyenga making the same disingenuous point in an investigation of his claims about the state’s tax code.
Politicians of both parties frequently claim to want to “fix” the tax code. A good first step would be to fix the way we talk about it.