Daily Mis-lead Report on "Middle-Class" Tax Cuts

(original article altered only in the adding of links to key sources)

THE DAILY MIS-LEAD

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ADMINISTRATION DISTORTS WHO BENEFITS FROM TAX CUT

The administration and most of the mainstream press are billing the tax package passed by Congress yesterday as a "middle class tax-cut."[1] The reality is that the new law is more of the same: tax cuts that benefit the rich and, in many cases, exclude the neediest families.

An analysis from the Urban Institute-Brookings Tax Policy Center shows that the middle 20 percent of earners "will receive an average tax cut of $162 in 2005 from this legislation."[2] The top fifth of earners, however, "will get an average tax cut of $1,317."[3] As a result, the top fifth will receive two-thirds of all benefits.[4]

The bill excluded a provision that would have extended the child tax credit to four million low-income families who currently don't qualify.[5] Extending eligibility to these families would have cost $4 billion.[6] Meanwhile, conservatives included $12 billion in tax cuts for corporations.[7]

Sources:

1. "Congress Extends Middle-Class Tax Breaks," The Kansas City Star,
9/24/04
2. "New 'Middle-Class' Tax-Cut Bill Represents Cynical Policymaking," Center for Budget and Policy Priorities, 9/23/04
3. Ibid
4. Ibid
5. "Lawmakers Can't Resist Voting to Extend Bush's Tax Cuts," Los
Angeles Times, 9/24/04
6. Ibid.
7. Ibid.