Kumbaya 4: Tax Increases
And, since Paul Ryan is a good Republican he thinks that we should make our tax system more efficient:
Here we see a sudden climb in Social Security income equal to more than half of a percent of GDP in 2011. Call it half a percent and it comes to about $10 billion per year over the next decade - using the CBO GDP forecasts. This would be a $1 trillion dollar tax increase over the next decade, without even mentioning the income tax increases.
But this would be a good tax increase.
Tax ProvisionsBecause we are not paying these fine economists to analyze Republican proposals but only to praise them we get no solid analysis of Ryan's proposed tax increases and no detailed explanation of how the tax credits would work. A graph provided in the analysis of Social Security does start to provide some clues:
- In 2011, the Roadmap would repeal the current exclusion of employment-based health insurance from income and payroll taxes. Also in 2011, a refundable tax credit would be available that could be used to purchase coverage through an employer or on an individual basis.
- The tax credit initially would be $2,300 per adult and $1,700 per child, not to exceed $5,700 per tax-filing unit. CBO assumed that 35 percent of the total cost of the tax credit would be refundable and would be treated as an outlay.
- CBO did not model tax revenues explicitly. Instead, Congressman Ryan’s staff specified that total federal tax revenues would follow revenues in the alternative fiscal scenario until they reached 19 percent of GDP in 2030 and would remain at that level thereafter.

But this would be a good tax increase.



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