Redding resident concerned about federal income tax increases

To the Editor:

With all the natural disasters and political intrigue going on, it seems Steven Mnuchin, our secretary of the Treasury is trying to sneak a little 31% increase in our federal income tax. This (is) coming from a fellow who amassed a $300-million fortune, while mostly paying a (long-term capital gains) 20% tax rate. Our Treasury guru insists that high-income folks and large corporations should pay less in taxes because their spending generates greater economic growth than government spending.

OK, Steve, I’m listening to your argument.

Here goes:

Mnuchen wants to eliminate the deduction for state and local income tax.

  • Average Redding family income: $152,000
  • Guestimate of family deduction: $52,000
  • Taxable income: $100,000
  • Federal income tax: $16,536
  • CT state tax on $152,000: $8,000
  • Average Redding property tax $12,000
  • Total state and local tax $20,000

In the Mnuchin plan, there is no deduction for state and property taxes

  • Average Redding family income: $152,000
  • Guestimate of family deduction $32,000 (no $20K deduction for state and property  tax)
  • Revised taxable income: $120,000
  • New federal income tax: $21,793

That’s a 31% tax increase.

Apparently, only big corporations’ and really rich dudes’ tax savings stimulate growth, not ours.

They pay less and the government gets an extra $5,257 from us. Sorry, local stores, restaurants, trades folks and charities, your loss is the super affluents’ gain.

Now, if we were all in the same tax increase boat to fund the reconstruction of Texas, Florida, and Puerto Rico, I would keep my mouth shut.

Fat cats win, we donkeys and elephants loose.

Pretty sneaky, eh?

C Greene

Newtown Turnpike

 

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