Should the tax cuts be extended?

[ProSense]

4. End all with a caveat:

Return to a tax structure similar to the 1960s



http://krugman.blogs.nytimes.com/2012/07/08/taxes-at-the-top/

Consider the following adjustments by Robert Reich.

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The most direct way to get more money into their pockets is to expand the Earned Income Tax Credit (a wage subsidy) all the way up through people earning $50,000, and reduce their income taxes to zero. Taxes on incomes between $50,000 and $90,000 should be cut to 10 percent; between $90,000 and $150,000 to 20 percent; between $150,000 and $250,000 to 30 percent.

And exempt the first $20,000 of income from payroll taxes.

Make up the revenues by increasing taxes on incomes between $250,000 to $500,000 to 40 percent; between $500,000 and $5 million, to 50 percent; between $5 million and $15 million, to 60 percent; and anything over $15 million, to 70 percent.

And raise the ceiling on the portion of income subject to payroll taxes to $500,000.

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http://robertreich.org/post/3277360050

Increasing taxes on people making $250,000 and lumping $500,000 and $5 million into the same category would be a tough sell.

The brackets could be adjusted:

$250,000 to $500,000 (no change)
$500,000 to $1 million (increse to 40 percent)
$1 million to $5 million (increase to 50 percent)
$5 million plus (increase to 60 to 65 percent)