No Middle-Class Income Tax
We all know that our tax code needs to be overhauled and simplified. My tax plan eliminates taxes on the middle class (anyone earning $125,000 or less) and makes up for the shortfall by slightly increasing taxes on individuals earning $1.25 million or more. This approach is known as the “residual income” plan because only the amount of income earned beyond $125,000 is subject to taxation. The first $125,000 of everyone’s income is tax-free, with the exception of a token $1 payment.
Yes, that’s right. My plan reduces income tax for anyone making $125,000 or less all the way down to one dollar. This token payment will also ensure that everyone has some skin in the game as a contributing member of society. When everyone’s $1 payment is added together it will also provide a substantial amount of revenue to the budget.
In fact, my residual income plan will yield more revenue than our current tax system because most income tax comes from a small number of ultra-wealthy individuals. According to IRS data (https://www.irs.gov/pub/irs-soi/09inratesnap.pdf), only 13% of all income tax revenue comes from the bottom 75% of earners. As such. a slight tax increase on the highest income earners will easily make up for the shortfall in tax revenue from the middle class.
Under my residual income plan, only the residual income beyond $125,000 will be subject to taxation. This residual income will be included in a single rate bracket that applies to everyone. As a result, everyone will pay less taxes except for individuals earning $1.25 million or more.
These days middle class families across the country are struggling to survive, in large part because they’re being held back by a tax system which disproportionately favors the ultra-rich. It’s time to give the middle class a break by relieving them from crushing tax burdens.
My residual income plan will provide the middle class with more disposable income that can be used for savings, investment, and consumption. This will provide an enormous boost to consumption, thereby creating jobs and kick-starting economic growth. We need to revive our economy quickly, and the best way to do so is by putting disposable income in the hands of the middle class.
Instead of bailing out the banks like we did following the 2008 financial crisis, it’s time for the government to bail out the middle class. Only by putting more disposable income in the hands of the middle class can we get our economy back on track. My tax plan will do just that, and it will also provide more revenue than our current tax system by ensuring that ultra-rich individuals pay their fair share.
In the past few years, the middle-class are slowly sinking toward or into poverty while the uber-rich are enjoying an unprecedented surge in their income. Our nation is spending more than the taxes we are collecting. I believe that we should eliminate taxes on those who have suffered the most, the middle-class. And, I believe to balance this loss in revenues, we should raise taxes by a small percentage on those whose income has not suffered and in fact has increased, the highest income-bracket folks.
It's clear that our tax code needs to be reformed, and on this front there is good news. Today-- more than any time in recent history-- both the American public and politicians are eager to strike a deal. And there's more good news: there are several ways to accomplish our shared goal of ensuring America has enough revenue to fund our budget without unduly burdening the middle class.
One of my strong-suits is the ability to cooperate with people of all stripes and colors. I have certain specific tax reforms in mind, but I'm certainly willing to cooperate with other politicians, my constituents, and the American public to reach consensus on tax reform. It's a challenging task but we can do it!
During the G.W. Bush Presidency years, we were involved in two unfunded wars in the Middle East. Congress, along with the President, created an unfunded Medicare Part-D program which speeds up the bankruptcy of the Medicare program. On top of all this fiscal irresponsibility, we lowered income taxes for the very wealthy and encouraged irresponsible sub-prime loans to be approved at an alarming rate. It is insane not to think that all this would eventually come down crashing around us. And, now, here we are right in the middle of all this mess.
My opponent, Mimi Walters, has been a US Congresswoman and California Senator and Assemblywoman for over a decade right in the middle of all this mess and she is part of the reason we are in this mess. Walters supported YES on making the Bush tax cuts permanent (Bill sponsored by Lewis, R-KY; Bill HR 586). Walters supported YES on $99 B economic stimulus (Bill HR 3090). Walters has signed the Americans for Tax Reform "Taxpayer Protection Pledge" which protects the wealthiest of our citizens. She is not for a responsible government. She is out to bankrupt WE the People’s government.
President Ronald Reagan did lower taxes once, but he also increased taxes 11 times during his Presidency when he knew it was necessary during a recession. I agree that cuts must be made in programs no longer needed or needed less. However, some revenue increase is also in order here and Walters is being absolutely inflexible and uncompromising. As your congressman, I would be open to new ideas and willing to compromise whenever the needs of my district outweigh unnecessary gridlock. Once again, she is not working for WE the People. Instead, she is working for her Wall Street and Billionaire Class campaign contributors. See which industries are Walters' largest contributors here!
Walters’ Voting/Support Record:
- YES on making the Bush tax cuts permanent (Bill sponsored by Lewis, R-KY; Bill HR 586)
- YES on $99 B economic stimulus (Bill HR 3090)
- Signed the Americans for Tax Reform "Taxpayer Protection Pledge" which protects the wealthiest of our citizens
- NOT standing up for WE the People
Varasteh’s Congressional Pledge:
- NO income tax for everyone making $125K or less, until our economy is stabilized
- Offset this revenue loss by imposing a marginal tax rate for those making more than $1.25M
- At the same time we must reform tax loophole laws
- Balance the budget and reduce the deficit, each and every year, once our economy stabilizes
- Lower Corporate tax rates in order to be more competitive with the rest of the world
- Standing up for WE the People
- Not for sale