Tax Break

Essential reading: Cliff bill means some pay more taxes, and more

January 2, 2013

Welcome to the top tax and accounting headlines from Reuters and other sources.

* Analysis: 77 percent of households to see tax increase. John McKinnon – The Wall Street Journal. The fiscal cliff bill’s impact would be far-reaching for American taxpayers, and particularly painful for very high-income households, according to a new analysis. About 77 percent of American households would see a tax increase compared to their 2012 tax levels, according to the analysis by the Tax Policy Center, a joint venture of the Brookings Institution and the Urban Institute. Link 

* Amid pressure, House passes fiscal deal. Jennifer Steinhauer – The New York Times. Ending a climactic fiscal showdown in the final hours of the 112th Congress, the House late Tuesday passed and sent to President Obama legislation to avert big income tax increases on most Americans and prevent large cuts in spending for the Pentagon and other government programs. Link

* Congress’s feeble finish to the ‘fiscal cliff’ fiasco. The Washington Post editorial. The compromise bill passed by Congress to avert the worst effects of the “fiscal cliff” is a small, imperfect package that will do too little to address the nation’s long-term debt problem. But for all its weaknesses, the bill’s enactment is far better than a failure by this Congress to act before it adjourns Thursday. Link

* Obama’s tax bill comes due. The Wall Street Journal editorial. The headlines say the Senate has passed a bill to avoid the tax cliff, hallelujah. This is the way to look at it if you have a pre-Copernican view of politics where Washington is the center of the economic universe. The better way to see it is that the tax bill on the private, productive part of the economy is now coming due for President Obama’s first-term spending and re-election. The Wall Street Journal editorial. Link 

 * Nothing is certain except more debt and taxes. David Malpass – The Wall Street Journal opinion. The deal that emerged from the Senate early Tuesday morning is being sold as a tax cut for the middle class. But the bill reduces the value of tax deductions for upper incomes and, with the new open-ended 3.8% Medicare tax that was enacted under ObamaCare, income-tax rates on families and small business owners earning over $450,000 have been pushed above 44 percent. Link

* Le tax fairness. The Wall Street Journal editorial. It turns out that, 220 years later, the French Revolution has something to contribute to mankind other than a warning about bloody ideological passions. In a ruling loaded with arguments from the 1789 Declaration of the Rights of Man and of the Citizen, France’s Constitutional Court on Saturday invalidated the new 75 percent top French tax rate on grounds of—get this—unfairness. Link

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