Barack Obama would change the way payroll taxes are levied for Social Security, eliminating the tax on wages between $102,000 and $250,000, but re-assessing it on incomes of $250,000 or more annually.
COLUMBUS, Ohio — Democratic Sen. Barack Obama on Friday called for higher payroll taxes on wage-earners making more than $250,000 annually, a step that would affect the wealthiest 3 percent of Americans.
[snip]
The 6.2 percent payroll tax is now applied to all wages up to $102,000 a year, which covers the entire amount for most Americans. Under Obama's plan, the tax would not apply to wages between that amount and $250,000. But all annual salaries above the quarter-million-dollar amount would be taxed under his plan, Obama said.
He also supports private savings accounts for younger workers, but as a voluntary measure:
...I would like for younger workers, younger workers only, to have an opportunity to take a few of their tax dollars, a few of theirs, and maybe put it into an account with their name on it. That's their money."
There is also some further detail available about Obama's and McCain's economic policies, regarding the impact each of them would have on various income levels, with estimated tax savings/losses for each income level. The difference is stark:
MCCAIN OBAMA
Income Avg. tax bill Avg. tax bill
Over $2.9M (top .1%) $ 269,364 + $701,885
$603K and up (top 1%) - $ 45,361 + $115,974
$227K-$603K (95-99%) - $ 7,871 + $ 12
$161K-$227K (90-95%) - $ 4,380 - $ 2,789
$112K-$161K (80-90%) - $ 2,614 - $ 2,204
$66K-$112K (60-80%) - $ 1,009 - $ 1,290
$38K-$66K (41-60%) - $ 319 - $ 1,042
$19K-$38K (21-40%) - $ 113 - $ 892
Under $19K (0-20%) - $ 19 - $ 567
One big problem, however, is that Obama's plan (McCain's, too) will increase the deficit (by trillions). In addition, as each candidate's plans are now proposed, each would bring in less revenue. John McCain's plan (as it has been estimated by Tax Policy Center) actually generates slightly more revenue than Obama's, but no details are available to determine how this is achieved.
And with that, I leave you this:
Comments