The “report” by the Democratic staff of the Joint Economic Committee (JEC) on June 20, 2012, purports to show that taxpayers with income less than $200,000 would be harmed by tax policies developed by the House Ways and Means Committee and outlined by House Budget Committee Chairman Paul Ryan in the Fiscal Year 2013 budget, The Path to Prosperity: A Blueprint for American Renewal (Ryan budget).
Under the tax policies outlined in Ryan budget, individual taxpayers would be subject to two federal individual income tax rates – 10% and 25%; the Alternative Minimum Tax (AMT) would be eliminated; the federal corporate income tax rate would be reduced to 25%; and the 3.8% health care surcharge enacted as part of Obamacare would be repealed. The resulting revenue loss would be offset by the elimination of unspecified tax preferences.
In the “report,” JEC Democratic staff utilizes a series of inconsistent data sources and analytical techniques. Consequently, the “report’s” conclusions are either misleading or incorrect.
The “report” uses data from the Tax Policy Center. The Tax Policy Center employs a concept, “Cash Income Level,” which imputes additional types of income that are not included on individual tax returns.1 The Tax Policy Center imputes all taxes – including corporate taxes – to individuals. Thus, the Tax Policy Center’s definitions of both income and taxes are significantly different than the IRS data used elsewhere in the “report.”
See full report attached in pdf format below: