Obama has emphasised in his speeches that it is the “richest Americans” who will get hit with tax increases, but by letting many tax-relief initiatives expire, Obama is targeting middle class Americans with shadow tax increases too.
If the provisions are allowed to expire on December 31, the top-tier personal income tax rate will rise to 39.6 per cent from 35 per cent. But lower-income families will pay more as well: the 25 per cent tax bracket will revert back to 28 per cent; the 28 per cent bracket will increase to 31 per cent; and the 33 per cent bracket will increase to 36 per cent. The special 10 per cent bracket is eliminated.
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