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Rich People Cry As Senate Passes "Fiscal Cliff" Deal To Raise Taxes On Wealthy
By
Jen Chung
Published Jan 1, 2013
Modified Jan 1, 2013
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By
Jen Chung
Published Jan 1, 2013
Modified Jan 1, 2013
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Many hours after President Obama said that there was a deal to avoid the so-called fiscal cliff and an increase in taxes for everyone, the Senate finally passed a deal very early this morning. In a 89-8 vote, Democrats and Republicans came together to raise taxes. As the Washington Post explains, it "primarily targets taxpayers who earn more than $450,000 per year, raising their rates for wages and investment profits. At the same time, the deal would protect more than 100 million households earning less than $250,000 a year from income tax increases scheduled to take effect Jan. 1."
The WaPo Wonkblog has all the important details of the plan, like how, "The tax on capital gains and dividends will be permanently set at 20 percent for those with income above the $450,000/$400,000 threshold. It will remain at 15 percent for everyone else. (Clinton-era rates were 20 percent for capital gains and taxed dividends as ordinary income, with a top rate of 39.6 percent.)"
Politicians scrambled to making something happen. The NY Times reports:
The deal, worked out in furious negotiations between Vice President Joseph R. Biden Jr. and the Republican Senate leader, Mitch McConnell, passed 89 to 8, with just three Democrats and five Republicans voting no. Although it lost the support of some of the Senate’s most conservative members, the broad coalition that pushed the accord across the finish line could portend swift House passage as early as New Year’s Day.
Quick passage before the markets reopen on Wednesday would be likely to negate any economic damage from Tuesday’s breach of the “fiscal cliff” and largely spare the nation’s economy from the one-two punch of large tax increases and across-the-board military and domestic spending cuts in the New Year.
“This shouldn’t be the model for how to do things around here,” Mr. McConnell said just after 1:30 a.m. “But I think we can say we’ve done some good for the country.”
Of course, not everyone thinks this is good: Meet Butch Yamali. The NY Post spoke to the "Long Island entrepreneur" who makes over $500,000. He cries, "Now my income is going to be taken away. Why would I work harder?" With the currrent deal, "he’s looking at [paying] least $10,000 more" in taxes." Yamali added, "We got hit hard by Sandy, and now this? I take my money and [put] it back into my business, but now I’m not so sure.... You are getting penalized for working hard, getting penalized for achieving. I don’t want to lay anyone off, but I am going to look at things and things that are not as profitable I may have to stop."
Yamali spoke for himself, Jerry Della Femina and the rest of the 2%, "We have problems — with more zeroes — problems that don’t let you sleep at night."
Tagged
2%
bush tax rates
capital gains tax
clinton tax rates
fiscal cliff
income tax
rich people
taxes
wealthy
Jen Chung
Jen Chung is a former WNYC and Gothamist editor.
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Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
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