Is allowing a temporary tax cut to expire raising taxes

Zyphlin said:

Thank you for the wonderfully one sided partisan input that ignores there are people on the left that claimed that letting the Bush Tax Cuts expire wasn't raising taxes but claiming the Republicans were in favor of a tax hike by voting against extending the pay roll tax cut.

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I never claimed to be nonpartisan. I clearly said "according to the GOP." I was talking about the Republican leadership only.

The answer is yes...and no. Yes, those that received the tax cut will have an effective tax increase. However, because the tax was not permanent and was previously established, it isn't really a tax increase. Both answer are correct really.

American said:

How long has this temporary tax cut been in effect?

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Does the length of time matter? As long as someone has to continue to extend it's not permanant.

Supreme Court Justices serve for life. They are confirmed and until they retire....they are Supreme Court Justices. The Chairman of the Federal Reserve is not permanant or for life, he must be confirmed every so often. Yes, some serve for multiple terms and like Grenspan serve for decades over multiple presidencies but it is not a permanant position.

As long as Congress has to vote on the Bush tax cuts in order to extend them...they are not permanant.

If the tax cut that was authorized was meant to be temporary, then no. It is not a tax increase once the authorized tax reduction period has expired but rather a reset of the taxes back to their original levels same as would happen if the Bush tax cuts were to expire January 1, 2013 (i.e., tax rate of 15% temporarily reduced to 12.5%; time period for temporary rate reduction expires, rates then return to original 15% rate).

A tax increase, IMO, would be if the rates were authorized at a higher level than what they were originally set (i.e., tax rate of 15% temporarily reduced to 12.5%, time period for temporary rate reduction expires, but new marginal tax rate of 18% is implemented).

The foremer scenario is what may happen if the payroll tax cut isn't extended. That latter isn't even being considered.

Reset...increase...too different things but both being viewed pretty much the same way because when you get right down to it both the reset and the increase takes money out of the pockets of working middle-class families who can least afford to pay more right now.

Note: I might also add that the argument concerning "defunding" the Social Security Trust Fund is also being misconstrued. No one's "raiding" the SSTF because no "stimulus" checks will be coming out from the Treasury that in anyway is associated with the payroll tax cut. (In short, no one is being paid anything to who otherwise would qualify for the payroll tax cut.) If anything, extending the payroll tax cut would be more like reauthorizing a payroll tax credit except all one has to do in order to receive the tax benefit essentially is be employeed.

ksu_aviator said:

The answer is yes...and no. Yes, those that received the tax cut will have an effective tax increase. However, because the tax was not permanent and was previously established, it isn't really a tax increase. Both answer are correct really.

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Now this I could somewhat agree with as long as a person is consistent...

IE one temporary tax cut not being extended isn't a raise and yet another temporary tax cut not being extended is a raise, etc.

The over arching question being able to be viewed in two different ways doesn't mean its reasonable to look at a situation in whatever particular over arching way suits your partisan agenda (general you here)

The over arching question being able to be viewed in two different ways doesn't mean its reasonable to look at a situation in whatever particular over arching way suits your partisan agenda (general you here)

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I agree...be consistent and use the correct terminology. In both cases, it's fine to say people will be paying more in taxes if they aren't exteneded. To say that it's a tax increase is incorrect but the tax rates (despite being different for over a decade in the case of the Bush tax rates) are the pre-Bush tax cut rates and the pre-payroll "tax holiday" rates.

Again, this discussion is flawed. We should talk about the appropriate level of taxation, not whether it's going up or down.

As an analogy - if you only know you're going faster than you were a minute ago, that doesn't tell you if you're speeding.

iliveonramen said:

I agree...be consistent and use the correct terminology. In both cases, it's fine to say people will be paying more in taxes if they aren't exteneded. To say that it's a tax increase is incorrect but the tax rates (despite being different for over a decade in the case of the Bush tax rates) are the pre-Bush tax cut rates and the pre-payroll "tax holiday" rates.

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I'll go a step further...

To say that people will see their payroll taxes raise would be a proper analogy. However, to say that people would see their payroll taxes increase would be inaccurate. Again, since the payroll tax would only revert back to its original rate if allowed to expire, there is no increase - just a reset to the original level.

Zyphlin said:

Pretty simpe here.

A Tax Cut is passed and is set to be temporary.

The time period for that temporary cut to expire is about to occur.

Attempts to extend the "temporary" time period fails.

Is the expiration of the temporary tax cut an example of "raising taxes".

Are those who vote against such a temporary extension voting in to "raise taxes"?

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It depends on how you personally frame the question. It is a tax increase over the most recent tax rate. It is returning taxes to their normal levels. Same thing, it's just how you frame your question. Neither is inherently more correct to the other.

is allowing a temporary tax-cut to expire= raising taxes?

yes.

Zyphlin said:

Pretty simpe here.

A Tax Cut is passed and is set to be temporary.

The time period for that temporary cut to expire is about to occur.

Attempts to extend the "temporary" time period fails.

Is the expiration of the temporary tax cut an example of "raising taxes".

Are those who vote against such a temporary extension voting in to "raise taxes"?

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of course it is. if your rate is now 10%, it has to be raised to get to 12%. this is all semantics and a joke, i think. letting the bush cuts expire on the weathly is raising taxes, letting the payroll tax cut expire is raising taxes.

Objective Voice said:

If the tax cut that was authorized was meant to be temporary, then no. It is not a tax increase once the authorized tax reduction period has expired but rather a reset of the taxes back to their original levels same as would happen if the Bush tax cuts were to expire January 1, 2013 (i.e., tax rate of 15% temporarily reduced to 12.5%; time period for temporary rate reduction expires, rates then return to original 15% rate).

A tax increase, IMO, would be if the rates were authorized at a higher level than what they were originally set (i.e., tax rate of 15% temporarily reduced to 12.5%, time period for temporary rate reduction expires, but new marginal tax rate of 18% is implemented).

The foremer scenario is what may happen if the payroll tax cut isn't extended. That latter isn't even being considered.

Reset...increase...too different things but both being viewed pretty much the same way because when you get right down to it both the reset and the increase takes money out of the pockets of working middle-class families who can least afford to pay more right now.

Note: I might also add that the argument concerning "defunding" the Social Security Trust Fund is also being misconstrued. No one's "raiding" the SSTF because no "stimulus" checks will be coming out from the Treasury that in anyway is associated with the payroll tax cut. (In short, no one is being paid anything to who otherwise would qualify for the payroll tax cut.) If anything, extending the payroll tax cut would be more like reauthorizing a payroll tax credit except all one has to do in order to receive the tax benefit essentially is be employeed.

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nothing but semantics.

Maybe the real lesson here is to stop allowing government to use words like "temporary" because, let's face it, things are only as temporary or permanent as the current political wind direction anyway. Then we wouldn't need to spin our wheels having these dumb-ass discussions to begin with.

Yes.

They have the power to extend it so if they don't then they are willfully raising taxes.

Zyphlin said:

Pretty simpe here.

A Tax Cut is passed and is set to be temporary.

The time period for that temporary cut to expire is about to occur.

Attempts to extend the "temporary" time period fails.

Is the expiration of the temporary tax cut an example of "raising taxes".

Are those who vote against such a temporary extension voting in to "raise taxes"?

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The expiration of a tax cut is a de facto tax hike. Failure to support an extension isn't a hike from normative rates, so much as it is a hike from existing ones. While that may be scheduled to take place without subsequent action, in such a case a failure to act is tantamount to support for the scheduled outcome.

To give you an example on a personal scale, my wife has a long-time friend who is someone of low character and with whom I would just as soon my wife not associate with. My wife is conflicted given that this person who has been her friend (if in name only) for more than twenty years and my wife does not presently have the time to go out and make new friends. This person is engaged to be married next year and will be moving out of state permanently once she does; at which time her interaction with my wife will be significantly reduced. My wife has resigned herself to passively allow time to pass and her "friend" to move rather than actively seek to break off an unhealthy relationship. The result is the same. My wife would never consider that she "supports" a diminished relationship with her friend, though that is exactly what will happen despite the fact my has no intention of actively seeking those ends. Leaving aside that my wife really has no control over her friend's decision to move regardless, it is still "support" for the same objective, the sole difference being between active, direct support (an act of commission) and passive, indirect support (an act of omission).

Same with the tax debate. And while some lawmakers may not want to "raise" taxes, but believe they've been artificially low and should return to previous standards, that's still a tax hike, regardless of how they prefer to think of it. Just as my wife won't ever see her passivity in "letting" her friend leave and the relationship just dissipate over time as her ending the friendship. It's only a mental rationalization to excuse their decision to assuage what they're doing. It doesn't change the facts, much less the outcome.

People can call day "night" and night "day" all they want. It doesn't make it so.

misterman said:

As an analogy - if you only know you're going faster than you were a minute ago, that doesn't tell you if you're speeding.

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Here's another analogy.

Congress passes a law to reduce he rate of spending growth and calls that a spending cut.

PerfectStorm said:

Here's another analogy.

Congress passes a law to reduce he rate of spending growth and calls that a spending cut.

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That is an entirely different scenario from what we're discussing, however. A lower rate of increase is not a "cut". An increase in tax rates is an increase. A lower rate of increase is still an increase. Your example is dishonest accounting whereas an honest assessment of the scenario given at the start of this thread is simply inconvenient verbiage for those who don't support the extension of existing policy.

Blackstone said:

A lower rate of increase is not a "cut".

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Tell that to the congress critters who are trying to sell it as a cut. (See Deficit Reduction Committee).

No, it's obviously not raising taxes. It's allowing a temporary measure to lower taxes in order to gain political capital to expire as planned, returning taxes to normal levels. The entire "lower taxes" schtick was a political ploy meant to curry favor with voters, knowing that another president would have to deal with the blowback when the expiration date arrived. In other words, it was a cheap shot that unfortunately had a gullible audience unable to recognize that they were being manipulated, and there would be future consequences to their fiscal myopia.

Yes, it is raising taxes. Democrats should just own up to it, the spinning is unnecessary.

DiAnna said:

No, it's obviously not raising taxes. It's allowing a temporary measure to lower taxes in order to gain political capital to expire as planned, returning taxes to normal levels. The entire "lower taxes" schtick was a political ploy meant to curry favor with voters, knowing that another president would have to deal with the blowback when the expiration date arrived. In other words, it was a cheap shot that unfortunately had a gullible audience unable to recognize that they were being manipulated, and there would be future consequences to their fiscal myopia.

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you do know that the income tax was sold as a temporary measure

the normal state is no income taxes. Clinton raised taxes, Bush lowered them, Obama wants to raise them only on a minority voting bloc

jamesrage said:

Do your taxes go up or down after a tax cut you got is allowed to expire? They do go up and as a result you are paying more taxes.Therefore it is a tax increase.

If all these people the 46% who do not pay federal income taxes lost all the deductions and had to pay 10,15 or 25 percent or more depending on what income tax bracket they fell into, would these people's taxes go up?

46 Percent of Americans Exempt From Federal Income Tax in 2011
Tax Brackets (Federal Income Tax Rates) 2000 through 2011

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Actually 86% of americans pay a positive tax rate. Nice talking points.

DiAnna said:

No, it's obviously not raising taxes. It's allowing a temporary measure to lower taxes in order to gain political capital to expire as planned, returning taxes to normal levels. The entire "lower taxes" schtick was a political ploy meant to curry favor with voters, knowing that another president would have to deal with the blowback when the expiration date arrived. In other words, it was a cheap shot that unfortunately had a gullible audience unable to recognize that they were being manipulated, and there would be future consequences to their fiscal myopia.

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Would you say the same thing if all the tax deductions and credits people received expired? That would mean the 47% who do not pay federal income taxes would suddenly state paying federal income taxes

Look at it like a sale in a retail store. If the price of an item is $39.99, then that's the price. If it goes on sale for a week for $29.99, the regular price is still $39.99, but you're temporarily able to get it for ten dollars less. At the end of the sale, it's not a price hike. The regular price was $39.99 all along. There was only a temporary discount. The same is true of a temporary tax decrease. Therefore, allowing a temporary tax cut to expire is not raising taxes. It expires on its own without the legislators doing anything. An actual tax increase requires that they have to actively choose to increase taxes.

Luna Tick said:

Look at it like a sale in a retail store. If the price of an item is $39.99, then that's the price. If it goes on sale for a week for $29.99, the regular price is still $39.99, but you're temporarily able to get it for ten dollars less. At the end of the sale, it's not a price hike. The regular price was $39.99 all along. There was only a temporary discount. The same is true of a temporary tax decrease. Therefore, allowing a temporary tax cut to expire is not raising taxes. It expires on its own without the legislators doing anything. An actual tax increase requires that they have to actively choose to increase taxes.

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I am pretty sure that if the 47% who do not pay federal income taxes suddenly lost those tax credits and deductions every lib would be screaming bloody murder that you are raising their taxes.