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DEL.ICIO.USNewt Gingrich and middle-class tax cuts
The Atlanta Journal-Constitution
In today’s Wall Street Journal, former House speaker Newt Gingrich says President-elect Barack Obama is right. Middle-class America needs a tax cut.
Just not Obama’s. Writes Gingrich, with Peter Ferrara of the Institute for Policy Innovation:
Mr. Obama’s tax plan includes creating or expanding nine or more federal income tax credits mostly focused on low- and moderate-income earners…
For the bottom 40% of income earners, who pay no federal income taxes on net today, these refundable income tax credits will not reduce tax liability but instead result in new checks from the federal government for the targeted social purposes. That’s not a tax cut. It’s welfare.
Instead, says Gingrich:
For a real middle-class tax cut, we should cut the 25% income tax rate that now applies to single workers earning $32,550 to $78,850, and married couples earning $65,100 to $131,450. We should reduce that rate down to the 15% rate paid by workers below these income levels. That would, in effect, establish a flat-rate tax of 15% for close to 90% of American workers.
The former Georgia congressman concedes that a reduction in corporate tax rates or the capital gains tax isn’t in the cards:
Fine. Leave those rates for a future initiative. For now we should focus on the middle-income tax rates that are attractive to cut in the current political climate.
Yet another idea from the white-haired idea machine that addresses how Republicans, demoralized by November’s results, can reclaim ground by showing what they’re for — not what they’re against.
Think of this as evidence that Gingrich, despite his declarations of disinterest, shouldn’t be dismissed — not yet — from this quiet race for the chairmanship of the Republican National Committee.
Three weeks ago, Gingrich let it be known that he was “available” for the job. The official Gingrich position, as of this week, is that he’s “not interested.” The unofficial line is that the two characterizations aren’t necessarily contradictory.
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