You've heard it a thousand times. President Obama wants to continue the Bush-era tax cuts for households with taxable incomes under $250,000 a year, while allowing those cuts to expire for wealthier taxpayers.
Were that to occur, the 33% bracket would increase to 36%, and the 35% bracket (currently the top marginal income tax rate) would increase to 39.6%. That's identical to the top tax rate we had at the end of Clinton administration. Some people claim a top rate of 39.6% smacks of socialism.
Really? 39.6% is socialism? I can't help but think we could benefit from a more realistic frame of reference to put all this socialism talk in perspective. And what better place to look than France.
Here's the kicker. France has presidential elections this year. The incumbent, Nicolas Sarkozy, leads a center-right coalition. His main challenger is Francois Hollande, leader of the French Socialist party. If you're curious what an ACTUAL SOCIALIST would do with the tax code, look no further than Monsieur Hollande. He wants to raise the top marginal rate to 75%. Mon Dieu !
View TaxAnalysts'® Robert Goulder's opinion in its entirety on Tax.com.
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