There has been a lot of talk in the press recently about various people with the Obama campaign quoting different figures on whom Sen. Obama would cut taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. es for or whom he wouldn't raise taxes on (based upon income levels). The campaign had long claimed that nobody making under $250,000 would face a tax hike. (Technically, that's not true since he raises corporate income taxA corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. es.) But it's pretty close to true with respect to the individual income taxAn individual income tax (or personal income tax) is levied on the wages, salaries, investments, or other forms of income an individual or household earns. The U.S. imposes a progressive income tax where rates increase with income. The Federal Income Tax was established in 1913 with the ratification of the 16th Amendment. Though barely 100 years old, individual income taxes are the largest source of tax revenue in the U.S. (assuming a married return; single returns the threshold is $200,000).
But recently Sen. Biden has been criticizing for saying this:
"Actually, Barack Obama has promised to cut taxes on households earning less than $200,000 a year while raising taxes on those who make more than $250,000 annually."
And now Bill Richardson, an Obama supporter, said this today:
"What Obama wants to do is he is basically looking at $120,000 and under among those that are in the middle class, and there is a tax cut for those."
So is the Obama campaign changing its tune? First off, Biden and Richardson could have just misspoken. (For Biden, that would be nothing new as we all know.) And given how much Obama has misled the American public on taxes in this campaign, like his opponent, who knows what we can trust?
But are the three positions ($250k, $200k, $120k) really inconsistent? Technically not. A classic Venn Diagram (and basic mathematical logic) would show that, by definition, since everyone who makes under $120,000 is below $250,000 and everyone below $200,000 is less than $250,000, the positions aren't contradictory. Neither Biden nor Richardson said that taxes would be hiked on those making less than $250,000. All they said was what groups would get tax relief. (Technically, not everyone in those groups gets tax relief under Obama's plan.)Share