InsideOut Elizabeth

New Jersey Citizen Action Releases Report Showing Impact to New Jersey Residents of Ending Bush Tax Cuts for Richest 2% of Americans

Wealthy Few Would Still Reap Significant Tax Breaks

Elizabeth InsideOut — Monday, July 30, 2012

By Neva Shari T

Elizabeth, N.J. — If the U.S. House of Representatives passes the Republican plan this week to extend the Bush-era tax cuts for one year for the richest 2 percent of households making over $250,000, the wealthiest 5 percent of New Jersey taxpayers in that income group could get a disproportionate 45.7 percent of the total tax breaks in their state. They're average tax cut would be about $27,000.

In contrast, if Congress passed President Obama's plan to extend the Bush tax cuts on the first $250,000 in household income, the average tax cut for New Jersey taxpayers who make more than that amount would be about $12,000, less than half of what they would get under the GOP plan. And the 22 percent of New Jersey taxpayers with income up to $25,000 would get larger average tax cuts under the Obama plan than under the Republican plan.

Those are among the key findings of a new report released today by New Jersey Citizen Action, "Time to Pay Their Fair Share: New Jersey Residents Can't Afford to Extend the Bush-era Tax Cuts for the Wealthy Few." The report is authored by Americans for Tax Fairness, Citizens for Tax Justice and the National Women's Law Center.

The report is timely because this week the U.S. House of Representatives will vote on the Republican plan to extend all the Bush tax cuts, including for the richest 2 percent of U.S. households, while ending improvements in tax credits for low-end and moderate-income families. The Democrats will offer an alternative plan similar to President Obama's, which the U.S. Senate passed last week by a 51 to 48 vote.

"Giving lavish tax breaks for those who need them the least is exactly the kind of special-interest giveaways Washington needs to stop," said Ann Vardeman, Organizer at NJ Citizen Action, a member of the Americans for Tax Fairness campaign. "We urge the House to end the Bush-era tax cuts to the richest 2 percent."

Major findings of the report include:

The additional tax cuts for the wealthiest 2 percent in the Republican plan will cost approximately $68 billion next year alone. That's equal to what the federal government spends to repair highways, improve education and provide school breakfasts for low-income children, ensure clean drinking water, and deliver meals at home to frail seniors. The report breaks down what New Jersey's share of these funds means for its residents:

"We can't afford to keep giving tax cuts to the richest," said Ann Vardeman of NJ Citizen Action. "We can't balance the budget on the backs of children, seniors, and families struggling to make ends meet. Those who have done well in America should do well by America and pay their fair share."

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