Obama's Tax Plan Charade

Barack Obama has repeatedly stated on the campaign trail, and in two debates with John McCain, that his tax plan would provide an income tax cut to 95 percent of working Americans. Just yesterday on CNN I saw Joe Biden repeat this claim. There's only one problem. The claim is a false one.

Think about this for a minute. How is it possible for 95 percent of working Americans to receive an income tax CUT when only 67 percent of working Americans pay income taxes? The numbers just don't add up.

According to the National Tax Payers' Union, citing IRS statistics, 32.6 percent of Americans filing income tax returns do not pay any income taxes at all. So how do they get a tax cut? You can't cut from zero. It's impossible.

Here's a look at who pays income taxes. A review of data compiled by the National Tax Payers' Union (of course, you can go to the IRS web site and examine the tables for yourself if you wish) reveals the following:

Percentiles by AGI AGI Threshold Percent of Income Tax Paid

Top 1%

$388,806

39.89

Top 5%

$153,542

60.14

Top 10%

$108,904

70.79

Top 25%

$64,702

86.27

Top 50%

$31,987

97.01

Bottom 50%

2.99

So the question remains, how do you cut income taxes for those Americans who do not pay income taxes? You can't. But you can give them a rebate and call it tax relief, which is exactly what the Obama plan does. It's simple: you redistribute wealth. You take money earned by some American citizens and you give it to others who did not earn it.

According to a report by the non-partisan Tax Foundation, the 60 percent burden already being borne by the top 5 percent is going to get much heavier if the Obama tax plan is enacted. The Foundation says, "In short, the Obama plan would redistribute more than $131 billion per year from the top 1 percent of taxpayers to all other taxpayers. In 2009, for example, Tax Policy Center figures show that after the income-shifting in the Obama plan, the top 1 percent of taxpayers would pay a greater share of the total federal tax burden than the bottom 80 percent of Americans combines. In other words, 1.13 million Americans would pay more in all federal taxes than 128 million of their fellow citizens combined."