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Election 2012: Taxes

Where do the candidates stand on taxes? Find out here!

August 27, 2012
CHRIS MADDALONI—GETTY IMAGES

 

Taxes are the money the government collects from people to pay for projects and plans, including schools, government services, road improvements and the military. The American tax system is complex. One of the biggest issues facing voters in this election is how much money it costs to run the government and how much people and businesses should pay in. The candidates have different ideas on how to improve the tax system so that Americans pay an amount of taxes that is fair but still allows the government to pay its bills.

 

* Barack Obama believes in the so-called Buffett Rule, which asks millionaires and billionaires to pay more in taxes. The rule would require people making more than $1 million a year to pay at least 30% of investment income in taxes. He believes no family earning less than $250,000 should face higher taxes. Here are some of his ideas about taxes:

-Keep tax rates the same, but apply the top tax rate for individuals making more than $250,000 a year.

-Cut the corporate tax rate (the percentage of earnings that companies pay to the government) from 35% to 28%, except for manufacturers, which would have a 25% rate.

-Increase the capital gains tax rate to 20% on high earners. (A capital gain is the amount of money you make when you buy or sell something, such as a stock or property.)

-Change the estate tax, which taxes the value of property that is passed from an individual to a family member after death. Increase the tax to 45% for properties worth more than 3.5 million.

 

* Mitt Romney believes lower tax rates will encourage businesses and economic growth. He says the U.S. government should reduce spending to allow for more tax cuts. Here are some of the tax cuts he proposes:

-Cut tax rates for individual income by 20%.

-Cut the corporate tax rate (the percentage of earnings that companies pay to the government) from 35% to 25%.

-Eliminate the tax on capital gains for families making below $200,000 a year. (A capital gain is the amount of money you make when you buy or sell something, such as a stock or property.)

-Repeal the estate tax, which taxes the value of property that is passed from an individual to a family member after death.

 

* The candidates’ positions are culled from their websites and other primary sources.

 

Click here to learn about more election issues.


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