{"id":751326,"date":"2022-07-19T12:11:48","date_gmt":"2022-07-19T12:11:48","guid":{"rendered":"https:\/\/dissidentvoice.org\/?p=131589"},"modified":"2022-07-19T12:11:48","modified_gmt":"2022-07-19T12:11:48","slug":"tax-breaks-helping-the-rich-get-richer","status":"publish","type":"post","link":"https:\/\/radiofree.asia\/2022\/07\/19\/tax-breaks-helping-the-rich-get-richer\/","title":{"rendered":"Tax Breaks Helping the Rich Get Richer"},"content":{"rendered":"

An extraordinarily cruel pandemic has been extraordinarily good to the rich, especially the super-rich. New billionaires<\/a> have been coined at the rate of one every 30 hours. For those already in the category, the dollars have risen faster than ever. In the first two years of Covid, the worth of the world\u2019s over 2,000 billionaires went up by $3.78 trillion.<\/p>\n

To name just a couple<\/a> of examples, Elon Musk went from $24.6 billion in March 2020 to $234 billion roughly two years later. The co-founders of Google, Larry Page and Sergey Brin, merely doubled their\u00a0wealth\u2014to nearly $114 billion and $109 billion, respectively.<\/p>\n

While the ultra-rich were enjoying\u00a0huge gains, the taxes they pay have been anything but. Those at the very top<\/a> have been averaging federal income taxes of just 8.2 percent, \u201ca lower rate than many ordinary Americans pay.\u201d Congress has been a major helpmate, offering an array of tax giveaways that overwhelmingly favor people with money<\/a>\u2014from the mega-rich all the way down to the garden variety rich.<\/p>\n

One of the biggest breaks, heavy with irony, is the fact that taxes are higher on work income than they are on wealth income (e.g., income from capital gains and dividends).\u00a0The maximum rate on long-term capital gains is only 20%, compared to 37% on earned income such as wages.<\/p>\n

Some of the irony comes straight from history. Over a generation ago, in the Tax Reform Act of 1986, the Republican icon Ronald Reagan equalized<\/a> taxes on capital gains and other income. It was Democrat Bill Clinton who went back to the old way, cutting<\/a> capital gains rates.<\/p>\n

There\u2019s plenty of talk<\/a> (most recently from President Biden) about bringing back equal taxes, but it hasn\u2019t come close to happening. What\u2019s close to happening instead is yet another handout to the retired rich.<\/p>\n

More than two years ago, on April 13, 2020, Daily News<\/em> readers came across this headline<\/a>: \u201cThe coronavirus stimulus was a bonanza for well-off retirees.\u201d The story was about required distributions from retirement accounts being waived for a year, including, of course, the taxes that come with them. The 2020 move was a blip, a temporary bonanza; what\u2019s now on deck, needing only Senate approval, is a permanent three-year pushback. Instead of starting at age 72, taxable required distributions wouldn\u2019t begin until age 75.<\/p>\n

It\u2019s the key provision in the Securing a Strong Retirement Act of 2022. Every<\/a> Democrat in the House voted for it, the only nays coming from five Republicans. Daniel Hemel, a tax professor at the NYU School of Law, called it<\/a> \u201ca deeply cynical deficit-expanding giveaway to high-income taxpayers\u2026Progressives and deficit hawks alike should say no to this gimmicky.\u201d<\/p>\n

Tax lawyer Robert Lord spoke to the corruption<\/a> of the 1974 law that first established retirement accounts: \u201cWhat started out as a well-designed program to help ordinary Americans\u2026has been transformed by the financial industry, the rich people they serve, and those carrying water for them in Congress. Today, IRAs and retirement plans\u2026function primarily as vehicles to further enrich America\u2019s wealthiest.\u201d<\/p>\n

Figures compiled by the Tax Policy Center back up Lord\u2019s claim: \u201c[A]lmost 90% of tax breaks<\/a> for retirement savings go to the highest-income 20% of U.S. households, a group that would save anyway.\u201d<\/p>\n

Tax expert Len Burman also weighed in on the new Secure Act, calling<\/a> it \u201cregressive and a budget scam. It\u2019s scored as revenue neutral, but it will cost billions in lost revenue outside the \u2018budget window.\u2019\u201d<\/p>\n

In the end, it\u2019s just another slap in the face to tax fairness. Only the particulars make it any different from all the other slaps that already litter the tax code. (There\u2019s already one more in the making, a bipartisan Senate cryptocurrency bill<\/a> that includes \u201ca huge tax avoidance opportunity for those involved in the crypto business.\u201d)<\/p>\n

Nothing is more subjective than taxes, and the conservative publisher Steve Forbes once offered his own special take<\/a>: \u201cThe tax code is a monstrosity and there\u2019s only one thing to do with it. Scrap it, kill it, drive a stake through its heart, bury it and hope it never rises again to terrorize the American people.\u201d<\/p>\n

Few would have suspected that the tax code itself \u2014 over time and with constant help from Congress \u2014 would become one of the most generous friends the rich ever had.<\/p>\n