As Americans, we always have celebrated the entrepreneurial spirit and strived for financial success, but fairness has been the shared value supporting those pursuits. It just goes against our founding fiber to give the rich tax breaks that they don’t need and the country can’t afford while hard-working, middle-class Americans have to make up the difference. All while we undermine our ability to invest in the schools, roads, and communities that strengthen our economy.
Thanks to the Bush-era tax cuts, wealthy people earning more than $1 million per year get an average tax break of about $150,000, but middle class people making about $50,000 per year get an average tax break of only $1,000, according to the Urban-Brookings Tax Policy Center.
Last week, the Senate and North Carolina’s own Senator Hagan voted to end the tax cuts on household incomes above $250,000 that benefit only the richest two percent.
This week, the U.S. House of Representatives will vote on whether to extend for one year the tax cuts on incomes up to $250,000 that will benefit all taxpayers, or whether to also extend the tax cuts that benefit only the richest two percent.
According to a new joint report by Americans for Tax Fairness, Citizens for Tax Justice and the National Women’s Law Center, the latter proposal would result in a third of the total tax cuts going to 2.2 percent of North Carolina households, those making more than $250,000. The same House bill that continues tax cuts for the richest two percent of Americans would also end improvements to several key tax credits that benefit more than 13 million working families, including 522,000 families in North Carolina alone.
The right choice is to end the unaffordable tax cuts for the wealthiest.
Continuing the tax cuts for the richest two percent will make it harder to bring the budget deficit under control. The government can save billions of dollars by asking the rich to pay their fair share. In fact, ending the Bush tax cuts for the richest two percent permanently would save nearly $1 trillion over a decade compared to extending all of the Bush tax cuts, according to the Center on Budget Policy and Priorities.
Failure to end the tax cuts for those at the top will have a profound impact on North Carolina communities. Without sufficient revenue, significant cuts will have to be made to investments in our safety, national security, health, and in the well-being and education of our children.
The country simply can’t afford to keep giving tax breaks to the wealthy and still meet our pressing needs, like preventing deep funding cutbacks in Medicare for our seniors and educating our children. Asking the wealthy in our country to pay their fair share is one way to help America get back on the track – and ending the Bush-era tax cuts for the richest two percent is a great place to start.
Alexandra Sirota is the Director of the N.C. Budget and Tax Center