The new ‘sin tax’
Legislators love to raise "sin taxes," those extra charges on things you shouldn't be doing in the first place, like drinking or smoking.
The Minnesota House DFL apparently thinks it is also a sin to have a high income. House Taxes Committee Chairwoman Ann Lenzcewski has proposed a tax increase plan that not only raises the cigarette tax by 54 cents and the alcohol tax by 3 to 5 cents per drink, it creates a 9 percent tax bracket for people who earn more than $169,700 a year ($300,000 for married couples).
Gov. Tim Pawlenty is sure to veto this or similar proposals that get to his desk.
The proposal would eliminate a lot of current tax breaks and deductions and replace them with credits aimed at those with more modest means.
The proposal would also allow counties to raise sales tax to replace local government aid and hold down property taxes (basically, replacing a recessive tax with another recessive tax), taxing digital downloads.
Worst of all, income and corporate tax breaks for companies participating in the Job Opportunity Building Zones program would disappear. JOBZ is a valuable tool for rural economic development and should be allowed to continue.
Well, it looks like this will be another legislative session going into overtime.
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SarahM
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04-25-09 12:48 PM
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OK,superduper,I mis-spoke. You are right,one would never lose all to taxes. And our current tax system is pretty much based on percentages as you pointed out. However, what is being proposed raises those percentages greatly,esp at the federal level, for those having a very good income. THAT is the part that concerns me... (A complicated issue!)
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superduper
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04-24-09 11:09 AM
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I don't understand SarahM, how someone could "loose it all to taxes". When you bump up a tax bracket, you only pay the higher rate on the amount in excess of the tax bracket threshold. Example (and these breakpoints are not correct) Lets say you pay 25% tax on money below $100,000 and 35% above $100,000. If one year you make 80,000, you would pay $20,000 in taxes. If the next year you make $120,000, you would pay $32,000 in taxes (.25x$100,000 + .35*($120,000-$100,000)), and not $42,000 in taxes (.35*$120,000). There are many people who have misconceptions about bumping up a tax bracket, and that if they can get one penny below the threshold, they are going to save a ton of money, but that is not the case.
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middleclassworker
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04-24-09 2:36 AM
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What would happen if we got rid of the cigarette tax, but also refused to pay, and allowed insurance companies to refuse to pay for treatment for diseases linked to first-hand smoking. People would still be able to get insurance, but the insurance company could charge a higher rate because their risk increases.
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SarahM
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04-23-09 5:18 PM
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IF the "rich" tax affected only the lazy rich... (well, whatever...) But there are ALOT of scenarios out there of someone having a GREAT year, only to lose it all to taxes. How would you like that if it was you??
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superduper
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04-21-09 10:33 PM
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You know, the bible says that it is easier for a camel to pass through the eye of a needle, than for a rich man to enter heaven. Maybe the democrats are just looking out for the welfare of those individuals.
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shadow
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04-21-09 7:18 PM
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I guess the opinion writer thinks it Ok to level a sin tax on the middle class and poor haven forbid the rich would have to go back to paying what the did under Clinton you remember him the the president that left office leaving a surplus . And you do remember G W Bush he the one thatg blew it all and left Obama with the mess this country is in now .
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