COLUMBUS GROVE, OH – AUGUST 25: Republican vice presidential candidate U.S. Rep. Paul Ryan (R-WI) speaks to supporters on August 25, 2012 in Columbus Grove, Ohio. Ryan and presumptive Republican presidential nominee, former Massachusetts Governor Mitt Romney, are campaigning together leading up to the Republican National Convention beginning August 27 in Tampa, Florida. (Image credit: Getty Images via @daylife)
The Debt Ceiling Deal
On Sunday September 9th 2012, presidential nominee Mitt Romney denounced the debt ceiling deal that helped to avert an overwhelming government debt default in the US. This despite the fact that one of the deals supporters is his current running mate Paul Ryan.
Mitt Romney called the deal between the White House and the congressional Republicans “a mistake”. He went on to say that the deal would cut our defense budget badly.
Lawmakers agreed to the deal at the 11 hour back in August 2011. The agreement was for $1 trillion in spending cuts over the next 10 years. This followed by the promise to impose another 1.2 trillion to deficits. Paul Ryan backed last year’s deal while head of the House of Representatives Budget Committee.
Romney stated that he thought the deal was a mistake on the part of the White House, and a mistake on the part of the Republicans to go along with it.
Paul Ryan said on CBS recently that he supported the deal because they needed to find common ground with President Obama and the Democrats. But that Republicans had proposed ways of cutting back wasteful Washington spending.
Mitt Romney told NBC that the White House’s sequestration plan of $1.2 trillion would severely cut our defense budget. Unless automatic spending cuts are implemented by year’s end, beginning Jan 2nd $1.2 trillion over ten years would come out of our defense budgets, not affecting 2011 taxes.
The Sfarras in Teaneck disputed the tax assessment on their home last year, which helped the value fall by almost 12%. This let them save almost a grand a year in property taxes. Dorthy Monooopli also did something similar, reducing the value on her home by 30k.
These are only a few of the people who are trying to get lower tax assessments due to the falling prices of real estate over the last few years. As the filing date for tax appeals gets closer, many people are trying to file the proper documents.
William Dressel, in charge of of the League of Municipalities, says that that such efforts are lowering the amount of property taxes that a town gets, which might reduce the services citizens get because of lack of funds.
A common strategy is for towns is to do an area wide assessment of real estate, so everything is in line with current market values. This makes it more difficult for homeowners to dispute the value of their homes.
Home prices have fallen about 20% since the housing bubble. However, an appeal is not guaranteed. Towns determine the value by using a ratio that takes into account the current state of the economy.
The city of Teaneck has a current tax ratio of near 104 percent. This means that lower tax assessments are possible, because the assessment is more than the real value. If a home was valued at $100,000, it would only be worth $96,000.
Most people agree with President Obama’s plan to require millionaires to put a significant amount of their income toward their 2012 taxes. However, the same people would prefer to see a cut in spending rather than a millionaire tax to help balance the federal budget. These results come from an Associated Press-GfK Poll.
The survey shows that Obama’s millionaire tax plan has a lot of support. However, his plan has not changed people’s opinions on how to bring down the budget deficit. United States deficits have been larger than $1 trillion dollars a year. Sixty-five percent of the people polled agreed with President Obama’s plan to tax millionaires at a rate equal to 30 percent of their income. According to the poll, only 26 percent of those surveyed were against the idea.
Interestingly, 56 percent of those polled preferred spending cuts rather than hikes in 2012 taxes to fix the budget. Thirty-one percent of those polled preferred tax hikes. This same question was asked a year ago, and the response changed only slightly.
The poll further showed that the majority of people have a more favorable view of Democrats than they do of Republicans. This should be good news for President Obama as we enter election season. According to the poll, 54 percent of those surveyed gave the Democrats good ratings and 46 percent of those surveyed gave Republicans favorable ratings.
Although Obama has little chance of having his proposal passed by Congress during the campaign season, it serves as a Democratic rallying cry. It also shows a stark contrast between Democrats and Republicans who would like to lower the tax rate for millionaires. It will be interesting to see how these issues are approached during the election.
Timothy Geithner, Treasury Secretary, outlined The Obama tax reform proposal to overhaul taxes on business as well as eliminating a few dozen loopholes for the 2012 Taxes. The plan is to bring the corporate tax rate down to the 28 percentile. As Obama revealed his plan, some of his critics do not believe that the cuts are not significant enough to be effective.
The proposal includes a minimum tax on foreign money earnings, though there were no details offered on how the plan would play out.
Geithner said in an interview that they wanted to restore the concept and policies in which American businesses gain success or fail based on the quality and worth of their product rather than the creativity of their tax law engineers.
Geithner went on to say that overhauling taxes will not be implemented for this year
Curtis Dubay, the tax policy senior analyst for Heritage Foundation, expressed limited optimism that this policy could be put in effect this year due to the fact it is an election year. He feared that the law might make things worse rather than better if it passed.
For William Gale, staff member of the nonpartisan Tax Policy Center, the proposal shared today demonstrates the difficulty in implementing major tax legislation on corporations due to the very difficult process of determining the current business income of the United States.
According to Gale, sometimes income gets taxed multiple times at the individual level of taxation and only once at the corporate tax level. There are even times when taxes are missed entirely.
One of the major goals of the proposal is to eliminate the inefficiency of taxing businesses and to make certain that the process is fair.
Geithner has been in contact with D-Mont. Sen. Max Baucus and Sen. Orrin Hatch, the Republican Utah representative. He hopes to meet with these two individuals in order to discuss the tax plan and establish a consensus.