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You Get A Tax! You Get A Tax! And You Get A Tax!

- September 26, 2017

As Democrats Rally Around Senator Bernie Sanders, A Closer Look At His Policy Proposals Reveals He Wants To Raise Taxes…On Everyone

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TOP TAKEAWAYS

  • Senator Bernie Sanders' (I-VT) tax plan would raise income taxes to as high as 52 percent of an individual's income.
  • Senator Sanders' massive tax increases would increase the tax burden on middle-income families by more than 10 percent.
  • Senator Sanders wants to increase the death tax to as much as 55 percent, and lower the exemption threshold by almost $2 million, hurting farmers.
  • Senator Sanders wants to tax stock trades, which could make it more expensive for middle-class families to invest.
  • To pay for his complete government takeover of health care, Senator Sanders has proposed a 4 percent tax on household income, and a 7.5 percent income-based premium on employers, including small businesses-taxes that could cost the average household $844.

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SENATOR SANDERS HAS PROPOSED DRAMATIC INCREASES TO THE INCOME TAX

Senator Sanders Believes The Federal Government Needs To Raise More Revenue

In His Tax Outline, Senator Bernie Sanders (I-VT) States, "Our Tax Code Fails In Its Basic Task Of Raising Enough Revenue To Finance Adequate Public Investments ." "Despite its complexity, our tax code fails in its basic task of raising enough revenue to finance adequate public investments." ("Making The Wealthy, Wall Street, And Large Corporations Pay Their Fair Share," BernieSanders.Com , Accessed 9/24/17)

Senator Sanders Has Said "It Is Clear That We Must Raise Significant New Revenue." "As Congress debates deficit reduction, it is clear that we must raise significant new revenue. At 15.8 percent of GDP, federal revenue is at almost the lowest point in 60 years." (Op-Ed, Sen. Bernie Sanders, "A Choice For Corporate America: Are You With America Or The Cayman Islands?," The Huffington Post , 2/9/13)

Senator Sanders Has Proposed A Dramatic Increase In Taxes On Personal Income

The Tax Policy Center Concluded That Senator Sanders' Proposal Would Raise Taxes On Everyone. "The proposal would raise taxes at every income level." (Frank Sammartino, Len Burman, Joseph Rosenberg, and Jeff Rohaly, "An Analysis Of Senator Bernie Sanders's Tax Proposals," Tax Policy Center , 3/4/16)

If Senator Sanders' Proposal Passed "Middle-Income Households Would See Their Taxes Rise By About $4,700, Equal To About 10 Percent Of After-Tax Income." "Middle-income households would see their taxes rise by about $4,700, equal to about 10 percent of after-tax income. Those in the lowest-income bracket would pay an additional $165, or 1.3 percent." (Linda Qiu, "PolitiFact's Guide To The 2016 Presidential Candidate Tax Plans," Politifact , 4/7/16)

Senator Sanders Has Proposed Raising Personal Income Tax Rates To As High As 52 Percent . "This plan would replace the top three income tax rates (33%, 35%, and 39.6%) with more progressive rates: 37% on income between $250,000 and $500,000. 43% on income between $500,000 and $2 million. 48% on income between $2 million and $10 million. (In 2013, only 113,000 households, just 0.08 percent of all taxpayers, had income between $2 million and $10 million.) 52% on income of $10 million and above. (In 2013, only 13,000 households, just 0.01 percent of taxpayers, had income exceeding $10 million.)" ("Making The Wealthy, Wall Street, And Large Corporations Pay Their Fair Share," BernieSanders.Com , Accessed 9/24/17)

SENATOR SANDERS PROPOSAL WOULD IMPOSE NEW PAYROLL TAXES ON EMPLOYERS AND WAGE EARNERS

Senator Sanders Would Create New Payroll Taxes

To Fund A Government Takeover Of Healthcare Sanders Will Impose A 7.5 Percent Payroll Tax "Under this option, employers would pay a 7.5 percent payroll tax to help finance Medicare for All - just $3,750." ("Options To Finance Medicare For All," Sen. Bernie Sanders , Accessed 9/20/17)

Senator Sanders Would Expand The Social Security Payroll Tax To Income Above $250,000. "Sen. Sanders will fight to apply the Social Security payroll tax on all income above $250,000 to expand Social Security benefits and to ensure that Social Security remains solvent for the next 58 years."

SENATOR SANDERS HAS PROPOSED A SUBSTANTIAL INCREASE AND EXPANSION OF THE SO-CALLED DEATH TAX

Senator Sanders' Plan Would Increase The Death Tax Rate, And Lower The Threshold At Which One Must Pay The Tax

Senator Sanders Would Raise The Death Tax Rate To As Much As 55 Percent. "Establish a new progressive estate tax rate structure as follows: 45 percent on the value of an estate between $3.5 million and $10 million. 50 percent for the value of an estate between $10 million and $50 million. 55 percent for the value of an estate in excess of $50 million." ("Making The Wealthy, Wall Street, And Large Corporations Pay Their Fair Share," BernieSanders.Com , Accessed 9/24/17)

  • The Federal Estate Tax Rate Was 40 Percent In 2017. "The estate tax changes matter to wealthy folks who try to whittle down their estates to keep below the threshold and avoid the 40% federal estate tax." (Ashlea Ebeling, "IRS Announces 2017 Estate And Gift Tax Limits: The $11 Million Tax Break," Forbes , 10/25/16)
  • In 2017, Estates Valued Below $5.49 Million And $11 Million Were Exempt From The Tax. "For 2017, the estate and gift tax exemption is $5.49 million per individual, up from $5.45 million in 2016. That means an individual can leave $5.49 million to heirs and pay no federal estate or gift tax. A married couple will be able to shield just shy of $11 million ($10.98 million) from federal estate and gift taxes. The annual gift exclusion remains at $14,000 for 2017." (Ashlea Ebeling, "IRS Announces 2017 Estate And Gift Tax Limits: The $11 Million Tax Break," Forbes , 10/25/16)

Even Democrats Agree: The Death Tax As It Stands Now Disproportionately Hurts Farmers

Brandon Whitt, A Seventh Generation Farmer, Said Urbanization Has Caused Property Value To Skyrocket So That While He May Not Make Much Money, The Estate Value Would Be Very High And His Family Would Have To Sell Off "A Big Part Of The Business" To Pay The Tax. "He said land in his area is going for $25,000 to $40,000 an acre because land value have soared (from $3,000 to $4,000 an acre in the mid-1990s) ever since a Nissan plant was built nearby, though he has not had an appraisal done of his property. 'Unfortunately we don't make a lot of money in this business,' Whitt said. 'We would have to sell off a big part of the business to pay the taxes.' He said he would like to maintain the farm as an example of modern agriculture within an urbanized area." (Glen Kessler, "Is The Estate Tax Killing Small Farms And Businesses?," The Washington Post , 4/14/15)

In South Dakota, Land Values Have Increased Seven-Fold Since 2000, Much Faster Than The Death Tax Exemptions, Which Are Indexed To Inflation, "Moreover, they said land prices have soared in South Dakota much faster than the estate-tax exemption, which is indexed for inflation. From 2013 to 2014, farm acreage in South Dakota increased in value by 22.5 percent, to $2,070 an acre, more than any other state, according to USDA. Cropland has increased in value by 20.8 percent, to $3,430 per acre. Overall, land values in South Dakota have increased seven-fold since 2000." (Glen Kessler, "Is The Estate Tax Killing Small Farms And Businesses?," The Washington Post , 4/14/15)

In Order To Avoid These Costly Tax Burdens, Senator Sanders Would Allow Farmers To Devalue Their Farmland . "Senator Sanders' plan would protect family farmers by allowing them to lower the value of their farmland by up to $3 million for estate tax purposes." ("Making The Wealthy, Wall Street, And Large Corporations Pay Their Fair Share," BernieSanders.Com , Accessed 9/24/17)

In 2012, Senator Claire McCaskill (D-MO) Introduced A Bill To Prevent A Scheduled Estate Tax Increase. "Citing the need for certainty for Missouri's farmers and ranchers, U.S. Senator Claire McCaskill today introduced legislation to prevent a scheduled increase in the federal estate tax by extending current estate tax levels through 2013." ("Mccaskill Introduces Bill Preventing Estate Tax Hike For Missouri Families, Sen. Claire Mccaskill, Accessed 8/16/17)

  • Senator McCaskill Cited Certainty For Farmers And Ranchers As The Reason She Would Fight To Lock In The Federal Estate Tax To Its Current Levels. ''Our farmers and ranchers need more certainty right now, not less, which is why I'm leading this effort to prevent a hike in the estate tax and instead, lock in current levels,' McCaskill said. 'As Missouri contends with the worst drought in a half-century, and the House of Representatives sits on its hands refusing to pass the Farm Bill, I'm going to keep fighting in every way I know how to provide certainty to our farm and ranch families so they can plan for the future.'" ("Mccaskill Introduces Bill Preventing Estate Tax Hike For Missouri Families, Sen. Claire Mccaskill, Accessed 8/16/17)
  • Senator McCaskill's Bill Was Also Supported By Senator Jon Tester (D-MT). "McCaskill's bill--backed by Senators Jon Tester of Montana and Mark Pryor of Arkansas--would lock in the current low rate of 35 percent on the transfer of properties worth more than $5 million for at least one more year, through 2013, to provide certainty for Missouri's farm and ranch families. The legislation's language mirrors a provision in the Republican-backed tax cut proposal." ("Mccaskill Introduces Bill Preventing Estate Tax Hike For Missouri Families, Sen. Claire Mccaskill, Accessed 8/16/17)
  • Voicing Support For The Bill Tester Said, " Congress Needs To Protect Montana's Family Farmers And Ranchers From The Estate Tax." "Congress needs to protect Montana's family farmers and ranchers from the estate tax and provide predictability and certainty," said Tester, a dry-land farmer from Big Sandy. "This bill is an important step in providing that certainty. Congress needs to pass this bill, because the last thing Montana farmers and ranchers need is another avoidable hurdle to jump over as we deal with record drought." ("Tester Protects Montana Farmers And Ranchers From Estate Tax," United States Senator Jon Tester , Accessed 8/17/17)

In 2000, Senator Bill Nelson (D-FL) Called For An "Outright Repeal" Of The Estate Tax. "And in what seemed like a shift from his previous stand, Nelson called for outright repeal of the estate tax. In a May speech, Nelson said he favored a targeted tax cut, including a cut in the estate tax 'for such things as the family farm.'" (Steve Bousquet, "GOP Portrays Senate Candidate As Clinton Clone," The Miami Herald, 8/13/00)

In 2006, Senator Nelson Said "I Believe That A Family With A Small Family Business Ought To Be Able To Pass That On For The Next Generation." "'I believe that a family with a small family business ought to be able to pass that on for the next generation.'" (Mark K. Matthews, "Nelson's Votes: He Crosses Party Lines, Rarely Takes Lead," Orlando Sentinel, 10/2/06)

In 2006, Senator Joe Donnelly (D-IN) Supported A Bill That Would Raise The Applicability Limit For The Estate Tax To $5 Million For An Individual, And $10 Million For Couples. " Donnelly said he supports a House-passed bill that would raise the applicability limits for the estate tax to $5 million for an individual and $10 million for a couple." (James Wensits, "Donnelly-Chocola Slugfest Continues; Estate Tax Ad Touches Nerve," South Bend Tribune , 6/4/200.6)

SENATOR SANDERS' TAX ON INVESTMENTS COULD MAKE IT HARDER FOR MIDDLE-CLASS AMERICANS TO INVEST

Senator Sanders Would Tax Investments, Bonds And Derivatives

Senator Sanders' Has Proposed A Tax On Trades "At A Rate Of 0.5 Percent For Stocks, 0.1 Percent For Bonds, And 0.005 Percent For Derivatives." "Under this proposal, trades would be taxed at a rate of 0.5 percent for stocks, 0.1 percent for bonds, and 0.005 percent for derivatives. This means, for example, that a trade of $1,000 in stocks would be subject to a tax of $5. A trade of $1,000 in swaps or other derivatives would be subject to a tax of five cents." ("Making The Wealthy, Wall Street, And Large Corporations Pay Their Fair Share," BernieSanders.Com , Accessed 9/24/17)

This Tax Would Be Imposed On All Wall Street Investment Houses, Who Could Then Pass The Taxes Along To Investors. "It would impose a tax on Wall Street investment houses, hedge funds, and other speculators. If those Wall Street investment houses chose to pass the tax along to investors, this plan would provide a tax credit to individuals making under $50,000 and couples making under $75,000 to ensure that they would not be impacted." ("Making The Wealthy, Wall Street, And Large Corporations Pay Their Fair Share," BernieSanders.Com , Accessed 9/24/17)

Senator Sanders' Tax On Investments Could Make Investments More Expensive For Middle Class Americans

Senator Sanders' Plan Would Repeal The Low Tax Rate For Investment Income. "This plan would repeal the special, low income tax rates on capital gains and stock dividends for married couples with incomes greater than $250,000. Capital gains and corporate stock dividends are taxed at lower rates than the wages and salaries most of us live on." ("Making The Wealthy, Wall Street, And Large Corporations Pay Their Fair Share," BernieSanders.Com , Accessed 9/24/17)

  • Senator Sanders Would Tax Capital Gains At The Same Rate As Ordinary Income. "Taxing capital gains and dividends the same as income from work." ("Options To Finance Medicare For All," Sen. Bernie Sanders , Accessed 9/20/17)

Companies Could Pass This Tax Hike On To Consumers, And To Offset This, Senator Sanders Would Provide A Tax Credit To Individuals Making Under $50,000 And Couples Making Under $75,000. "This proposal would not tax investors, retirees, or parents saving to send their kids to college. Instead, it would impose a tax on Wall Street investment houses, hedge funds, and other speculators. If those Wall Street investment houses chose to pass the tax along to investors, this plan would provide a tax credit to individuals making under $50,000 and couples making under $75,000 to ensure that they would not be impacted." ("Making The Wealthy, Wall Street, And Large Corporations Pay Their Fair Share," BernieSanders.Com , Accessed 9/24/17)

  • The Median Household Income In America Is $55,775, Which May Mean That Many American Households Would Not Be Eligible For This Exemption. "According to the Census ACS survey, the median household income for the United States was $55,775 in 2015, the latest data available." ("U.S. Household Income, Pew Research Center , Accessed 9/25/17)

IN ADDITION TO A PLETHORA OF TAX INCREASES, SENATOR SANDERS HAS OFFERED A MENU OF TAX HIKES TO FUND HIS GOVERNMENT TAKEOVER OF HEALTH CARE

Senator Sanders Has Proposed A Variety Of Tax Increases To Pay For His Single-Payer Health care Proposal

In An Accompanying White Paper Released With His Single-Payer Legislation, Senator Sanders Has Proposed $16.19 Trillion In Tax Increases. "7.5 percent income-based premium paid by employers Revenue raised: $3.9 trillion over ten years. 4 percent income-based premium paid by households Revenue raised: $3.5 trillion over ten years. Savings from Health Tax Expenditures Revenue raised: $4.2 trillion over ten years. Make the Personal Income Tax More Progressive Revenue raised: $1.8 trillion over ten years. Make the Estate Tax More Progressive Revenue raised: $249 billion over ten years. Establish a Wealth Tax on the Top 0.1 percent Revenue raised: $1.3 trillion over ten years. Close the Gingrich-Edwards Loophole and Create Parity for Wealthy Business Owners Revenue raised: $247 billion over ten years. Impose a one-time tax on currently held offshore profits Revenue raised: $767 billion over ten years. Impose a Fee on Large Financial Institutions Revenue raised: $117 billion over ten years. Repeal Corporate Accounting Gimmicks Revenue raised: $112 billion ten years." ("Options To Finance Medicare For All," Sen. Bernie Sanders , Accessed 9/20/17)

One Suggestion Contained In The White Paper Is A "7.5 Percent Income-Based Premium Paid By Employers" That Would Raise $3.9 Trillion Over A Decade. "7.5 percent income-based premium paid by employers. Revenue raised: $3.9 trillion over ten years." ("Options To Finance Medicare For All," Sen. Bernie Sanders , Accessed 9/20/17)

Another Suggestion In The White Paper Is A 4 Percent Tax Increase On Household Income That Would Raise $3.5 Trillion Over A Decade. "4 percent income-based premium paid by households. Revenue raised: $3.5 trillion over ten years." ("Options To Finance Medicare For All," Sen. Bernie Sanders , Accessed 9/20/17)

  • A Family Making $50,000 A Year Would Pay An Additional $844 Due To This Tax . "Under this option, a typical family of four earning $50,000, after taking the standard deduction, would pay a 4 percent income-based premium to fund Medicare for All - just $844 a year." ("Options To Finance Medicare For All," Sen. Bernie Sanders , Accessed 9/20/17)

In Addition To Raising Income Taxes, Senator Sanders Also Seeks To Impose A "Wealth Tax." "This option would establish an annual 1 percent federal wealth tax on the net worth of the wealthiest 0.1 percent of U.S. households. The tax would apply to net worth exceeding $21 million for a household. That means a household with $21.5 million would pay 1 percent of $500,000, or $5,000." ("Options To Finance Medicare For All," Sen. Bernie Sanders , Accessed 9/20/17)

  • Some Have Argued That This Tax Would Be "Potentially Unconstitutional." "Others have argued that any wealth tax would be dauntingly complicated, and potentially unconstitutional. Sanders has described it as one way to spread the concentration of wealth." (Ruby Cramer, "With Popular Single-Payer Plan, Bernie Sanders Enters New Territory: A Wealth Tax," Buzzfeed , 9/20/17)

Senator Sanders Would Force Owners Of S-Corporations To Pay Themselves A Salary Separate From Their Business Profits So That It Could Be Subjected To Payroll Taxes. "Close the Gingrich-Edwards Loophole and Create Parity for Wealthy Business Owners. Revenue raised: $247 billion over ten years. This option closes the Gingrich-Edwards loophole which allows individuals who own and run an S-Corporation to game the system and avoid paying payroll taxes by claiming some income as business profits." ("Options To Finance Medicare For All," Sen. Bernie Sanders , Accessed 9/20/17)


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