How the fiscal cliff affects the poorest Americans
Monday, October 29, 2012
- Organization: Washington Post
- Source: Minnesota > ProJusticeMN.org
The fiscal cliff hits the richest Americans harder than the poorest ones: If all of the tax changes happen on Dec. 31, the top 20 percent of Americans would see their effective tax rate rise about 5.8 percentage points on average, while the bottom 20 percent of Americans would see their tax rate rise about 3.7 percentage points, according to the Tax Policy Center That’s largely because of the Bush tax cuts to income, capital gains and the estate tax. But certain parts of the fiscal cliff have would have a much bigger impact on poor Americans than rich ones.
Both the Child Tax Credit and Earned Income Tax Credit were expanded under Obama’s 2009 stimulus to help lower-income Americans—and despite being scheduled to expire on Dec. 31, these extensions have seen less attention than other elements of the fiscal cliff.