should the USA raise the Alternative Minimum tax to 15%? It is now 1%?

Question

The alternative minimum tax is used by the rich, when they write off most of their income. It's one way the rich get a lot richer!

What would happen if the USA raised it from 1% to 15%?

Answer 1

Trickle down economics does not work- Money in the hands of people stimulates the economy, whether they are rich or poor. The problem- how to you put money in the hands of the poor? Transfer of more wealth from the rich to the poor each year? This would only create greater dependency on entitlements and give lessen the incentive to achieve. Give the poor greater tax cuts? You can only cut the taxes for the poor by so much, because they don't pay much in taxes. When Tom Daschle said that the result of a proposed Bush tax cut would mean that a rich person would be able to buy a new car, without realizing it, he proved the theory of Trickle Down Economics. The person selling that car would generate income that he would otherwise not have had. Please note that if that person sells enough cars, he will gain wealth. If tax rates in this county were at 75% what would happen to the economy? The answer is that no one would have money to spend on anything except housing and food. The result would be that businesses everywhere would fail, because no one would have money to buy clothes, electronics, entertainment, repairs for their homes or cars, go on vacation..... If they did buy such things, they would have to go in to debt to do so. How would this help the working class or the poor? Please note the average taxpayer, pays roughly 50% of their income in taxes. After the attack on September 11th, Hillary Clinton said, "come to New York and spend money." She knew if people stopped coming to New York and spending money, businesses would fail and the economy in New York would suffer a great downturn, which would hurt the average working family. This is interesting considering that liberals are for tax hikes and against tax cuts. The only thing that helps the working class is a strong economy. It gives the average worker more freedom and more bargaining power. When the financial sector was booming from 1987 through 1989, workers were getting bonuses, overtime and stock options. When the financial sector suffered a downturn in 1990, it trickled down. There were no more bonuses, overtime, stock options and their were layoffs.

Answer 2

First, you completely misunderstand what the AMT is. When you start earning too much, according to the gov't, they have an alternative minimum tax which does NOT let you write things off. That AMT is set so low now that it catches millions of tax payers, when it was originally enacted to catch hundreds. The rich pay more with AMT, not less.

Would it shock you to learn that the top 5% of income earners pay 57% of the federal income taxes? And you better believe most of them are paying the AMT.

The top 25% of income earners paid 85% of the federal income taxes? That's up from 80% in 1986. So not only do the rich pay the most taxes, their "share" has increased! The bottom 50%'s share went from 6.5% in 1986 to 3.3% in 2004. The poor and middle class are paying less in income taxes than ever before. See IRS data link below.

Answer 3

That would work only if it kicked in at the higher income levels. The real reason Bush got elected was the two large tax cuts to his financial supporters. The rich more than made their political contributions back off the two enormous tax cuts for the wealthy Bush pushed through. Deficits, Illegals and favors to the rich will be counted among his greatest achievements.

Answer 4

The rich already pay 50% of their income. If you keep taxing the rich the economy fails because Democrat trailer dwellers don't invest in the stock market.

Its basic economics. Supply side economics worked for ten years. The economy crashed when the Dems forced a tax hike upon the US. Why do these simple economic principles escape so many people?

If you want to do something innovative try the flat tax and get government out of areas where it doesn't belong. Small government is good government.

Answer 5

You are incredibly confused.

1.) AMT rate = 20%, so you are apparently advocating lowering the rate by 5%.

2.) No one writes off their income. Rich get richer because they use their money to make money, instead of laboring for it.

"Work smarter, not harder"

Answer 6

More important than the TAX itself would be the circumstances that led the U.S.A. to actually do that.

We would need a very different legislature, made of not-so-rich people, for that to happen.

Answer 7

I'm shocked at the response to this question. I say remove the tax on beer.

Answer 8

It wouldn't matter to us, we already paid 50% this year.

Answer 9

Yes thats a very good ideal!!!