Analysis: Obama budget raises taxes on the middle class

ADVERTISEMENT
"However, middle-income households would benefit from two other tax changes: a more generous child and dependent care tax credit, and Obama’s proposal to extend those relatively generous rules for the earned income credit, child tax credit, and education credit.”

TPC found that higher income individuals would pay the lion’s share of the $1.1 trillion in tax increases under the Obama proposal, which would eliminate tax breaks while keeping rates the same or lowering them. The budget would cap the value of deductions at 28 percent and establish a minimum tax known as the Buffet rule. 

“For high-income taxpayers, the news is nearly all bad,” Gleckman wrote. 

Households making more than $1 million a year would see their taxes go up an average of 2.3 percent or by $83,000 in 2015. Their taxes would be $96,000 more by 2023.

All told, the top 1 percent of earners will pay 67.2 percent of the new taxes in the Obama budget by 2023. Those making less than $30,000 will see a net tax cut, and upper middle class taxpayers making between $100,000 and $200,000 per year will see a 0.2 percent tax increase of an estimated $382 by 2023.