President Obama’s tax plan, which he claims is rooted in “middle-class economics,” will raise taxes on the middle class, according to a new analysis by the Tax Policy Center, which is a joint project of the Brookings Institution and Urban Institute.
Obama said his plan would put thousands of dollars into the pockets of working class families, but it would actually raise taxes on those making between $49,000 and $84,000 by an average of $7, the analysis concludes. And for families making less than that, the plan would put less than $200 back in their pockets.
“We need a tax code that truly helps working Americans trying to get a leg up in the new economy, and we can achieve that together,” Obama said in his State of the Union Address. “Helping hardworking families make ends meet.”
Middle class economics means “helping folks afford childcare, college, health care, a home, retirement — and my budget will address each of these issues, lowering the taxes of working families and putting thousands of dollars back into their pockets each year,” he said.
About one-quarter of middle-income earners would see a tax cut averaging $549, while about half would see a tax increase averaging $289, averaging out to the net increase of $7.
His plan would pay for a slew of handouts, including a $500 credit for two-earner families, a dramatically expanded child care tax credit and two years of free community college by hiking taxes on the upper class — making it a transfer of wealth from the rich to the poor, rather than a boost to the middle class.
Obama dropped part of his plan, which would have gutted a popular education savings account used by millions of Americans, following heavy criticism that it would hurt the middle class. (RELATED: Obama Flip Flopping On 529 Tax Breaks)
About 5 percent of those making less than $25,000 would see a tax increase under Obama’s plan averaging $237, while 30 percent would see a decrease averaging $616. As a whole they would get a net decrease of $174.
The plan would hike taxes on the top 1 percent of earners by an average of $29,000.
Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact licensing@dailycallernewsfoundation.org.
All content created by the Daily Caller News Foundation, an independent and nonpartisan newswire service, is available without charge to any legitimate news publisher that can provide a large audience. All republished articles must include our logo, our reporter’s byline and their DCNF affiliation. For any questions about our guidelines or partnering with us, please contact licensing@dailycallernewsfoundation.org.
