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Edwards Ad Falsely Claims Taxes Have Increased

His ad says "Millionaires' taxes keep going down while yours go up." But in fact, federal income taxes have gone down for everybody who paid any

December 2, 2003

Modified: December 9, 2003

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Summary

 

A TV ad called "Yours" began airing late September, in which Edwards speaks directly to camera to say “Washington ’s not working for you. …Millionaires’ taxes keep going down while yours go up.” It’s false. Federal income taxes have been cut at all levels. For example, the lowest tax bracket is now 10%, down from 15% before the first Bush tax cut. Statistics also show that the total federal, state and local tax burden has declined.

Analysis

 

By saying “yours keep going up,” Edwards implies that many or most of his listeners are seeing tax increases. But in fact, most have received tax cuts of hundreds or even thousands of dollars.

According to Citizens for Tax Justice, which is no friend of the Bush administration, middle-income taxpayers get an average cut of $827 in 2003 and $863 in 2004. These are taxpayers in the middle 20% -- making between $28,000 and $45,000.  And according to CTJ, even those in the lowest 20%,  making less than $16,000 a year, get a cut of $87 this year and $91 next year.

It is true that millions of workers get no tax cut at all, because they earn too little to pay federal income taxes in the first place. But that’s no justification for saying that taxes are going up. They’re not.

Text of Edwards Ad:

“Yours”

JOHN EDWARDS: America  works best when it works for all of us, but today Washington 's not working for you. Corporations get tax breaks and ship jobs overseas. Drug companies block cheaper prescriptions. Millionaires' taxes keep going down while yours go up. Why? Because money and lobbyists run our government, and they own this White House.

I'm John Edwards. I've never taken a dime from PACs or Washington lobbyists, and I never will. I approve this message because I want to be your president, not theirs.

When asked to justify Edwards’ statement, an aide said “even if everybody got some small tax cut from the 2001 tax cut, that tax cut is outweighed in many instances by the increases in taxes and tax-like fees at the local level." (Emphasis added). But Edwards didn’t say "tax-like fees,’ he said ‘taxes.’ And in any case, there are actually not many instances in which state-local taxes and state-local fees have gone up by more than federal taxes have come down.

The Edwards camp points to a misleading article published by the Democratic Leadership Council claiming that “many” families “are being stuck with a tax increase.”

The article attempts to document that statement by pointing to increases in tuition at state colleges and universities in seven states. But a tuition increase is not a tax increase, and in any case tuition is paid only by a small minority of families who happen to have children in college. For the vast majority any increases in state and local taxes have not offset the federal tax cuts enacted under Bush, even in the seven states selected by the DLC article.

In fact, according to the Tax Foundation, combined levels of federal, state and local taxes were significantly lower this year than in 2000, the year before Bush took office. In that year taxes at all levels averaged 33% of income, while this year the average is down to 30%. And contrary to the claim made by the Edwards staff and the DLC article, effective rates of state-local taxes have not increased at all. In fact, they have declined, if only by a tiny 0.2%, to 9.7% of income.

So Edwards has it backwards. For the vast majority, your taxes have been going down, not up.

 

Sources

 

J. Scott Moody, "America Celebrates Tax Freedom Day®: In 2003, Americans Will Work from January 1 to April 19 Before Earning Enough To Pay Taxes, Same as in 2002 But 11 Days Earlier Than in 2000" Special Report No. 122 (Tax Foundation, Washington DC) April 2003.

Robert McIntyre, "Average Tax Cuts under the 2001-03 Bush Tax Cuts by Year" Institute on Taxation and Economic Policy Tax Model, Citizens for Tax Justice, July 2003.

Paul Weinstein Jr., "Bush's Tax Shakedown: The president's reckless tax cuts are driving up state and local taxes" Blueprint Magazine (Washington: Democratic Leadership Council) 30 June 2003.