"Taxmageddon" will add $2,662 in taxes to each Maine tax return in 2013

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The Heritage Foundation, a national, conservative think-tank says that what they call “taxmaggedon” will cost Mainers filing a tax return an additional total of $2,662 each, and Maine as whole a total of $1.85 billion in increased taxes in 2013.

“Taxmaggedon” is what Heritage has dubbed a slew of major tax increases that are set to take effect next year. According to the group, which pulled the tax increase data it used for its study from the IRS and estimates from the Office of Management and Budget and Joint Committee on Taxation, the United States will see a total tax increase of $494 billion in 2013 alone, the highest ever in U.S. history for one year.

The group says that 34% of the tax increase will be made up of increases that come from the expiration of the Bush-era tax cuts. There is currently debate in Washington about whether to renew the business-friendly tax rate that Bush set in his presidency, or let the rates increase dramatically in 2013.

Another 25% of the highest-in-history tax increase is made up of an increase in the payroll tax, which is also set to go up in 2013. According to Heritage, “most of the remaining increases come from Obamacare, notably from the start of the hospital insurance 3.8% surtax on all forms of income over $250,000.”

For Maine, the group says the billions in increased taxes nationwide means thousands in additional taxes for each Mainer. Maine, whose average income per tax return is $50,742, isn’t hit as hard as some other states who have a higher average income on their tax returns. For example, Maine’s neighbor New Hampshire, whose average tax return income is $66,940, will see an average tax increase of $3,630 per tax return because of “taxmaggedon.”

The Heritage report says that “taxmaggedon” will hit the middle class the hardest. “Taxmageddon falls primarily on middle- and low-income Americans,” the report says. “That’s because 60 percent of the Bush tax cuts went to middle and low-income taxpayers. The expiration of the patch on the Alternative Minimum Tax (AMT) will cause these taxpayers to pay a tax they were never supposed to be hit with, and the expiration of the payroll tax cut is a tax hike almost exclusively on middle- and low-income families.”

There is an indirect impact on middle-class Mainers as well. Heritage says the impending tax hikes set for 2013 have already discouraged business from hiring. Additionally, the uncertainty involved with the tax rates is enough for many businesses, and small-businesses here in Maine, to put the hold on further investments in their business until they know for sure what the tax rates will be, according to Heritage. President Obama and Congress can still act to renew the Bush-era tax rates.

“Families, businesses and investors need to know how much more they’ll pay in taxes next year before they make important economic decisions,” the report says. “This means they, and the rest of the economy, are stuck in neutral while they wait to see if Congress and the President will act.”


        

29 COMMENTS

  1. And what would be the effect of the president’s proposal? No tax increases for people with incomes under $250,000 a year. 

    And, as I’m sure you know, giving averages is pretty meaningless. At least you could use the median, which better expresses the impact on middle-income people. 

  2. More of Barrack Hussein Obama’s fudamental transformation of America into a Socialist state. Obama is a liar, plan and simple. He promised on the campaign trail that he would not raise taxes on middle class Americans, yet he is saddling these same Americans with the largest tax increase in history of the country. 

  3. What a bunch of cry baby whiners!

    These aren’t tax Increases!

    These are ends to Tax Breaks!

    You spent the Money –Now Pay the Bill!

    What do we need to do?

    Get a Collections agency to go after Grover Babe?

  4. These tax increases are meaningless!

    Obama is spending so much more than revenue projections, the “extra” money (if any) is like giving pennies to somebody who owes millions!

    Higher taxes now WON’T help the debt but WILL kill jobs.

    BHO cannot step away from his far-left, punish-success ideology… it’s that simple. When he made his recent proposal, he tried to make the case for higher taxes on some Americans by limply stating he “believes” they should pay more.

  5. How much of Maine households are in the “pay zero income tax” class.  Of course they want to soak the “rich”.  If I am contributing squat to help the nation but taking plenty of freebies, I’d vote that way too.

  6. When a taxpayer pays more, it is called an “increase.” When the taxpayer gets to keep more of his/her earned income, it is called a “decrease.” 

  7. The IRS and the 16th Amendment needs to be repealed! A consumption tax could replace the revenue!

  8. The more money Maine’s wealthy pay the government, the less they spend on luxury goods made my Maine’s struggling craftspeople and artists…who have been quietly moving to other states.

    Nothing like making policy with opinion polls….I’d bet the same number are willing to slash the size of UMO’s political science depts. and reinvest the money into paying our share of an expanded Medicaid program…..oops, did I step on your toes or are you independently wealthy? 

  9. You avoided answering the question raised, which is how much will a Mainer’s taxes go up in 2013 and what is the impact on creating more jobs and expanding the economy?

    We already have hospitals teetering on the edge of insolvency; so is taxing them under the ACA wise? 

    Then there is the looming specter of the IRS confiscating property, and pre-empting State claims on the money…or maybe you see a decrease in IRS enforcement actions in Maine in your crystal ball?

  10. Wow, a poll by the Pingree Peoples Herald showing 70% of Mainers support taxing the job creators into oblivion. Oh, that’s just brillant! I’m sure that 70% are all uber-liberals living in San Francisco East. This poll is as worthless as the liberal rag it’s published in.

  11. Most Mainers are overly concerned ab0ut the ever-present now. Because the press, yourself  included, make a living on denigrating the rich, those Mainers who represent the 70% are way too angry at the rich who create jobs and wealth to realize we depend on them for a living. If BHO is re-elected I predict the US economy will tank to the point of desperation where many European economies are in right now, and widespread rioting & looting as we see in Europe will take place here in the US. But continued taxpayer abortion on demand, gay marriage and normalization of unnatural sex, big intrusive nanny government,  religion defined as “worship only” for the purpose of the 1st Amendment, euthanasia, censorship of all religious expression in the public square, elimination of the 2nd Amendment right to bear arms to protect private citizens, elimination of private modes of transportation, etc – all these things and more, are more important than the welfare of the people. So the mainstream media will just do its best to convince us all BHO is  needed to bring about “change” he couldn’t complete in his first term in office.

  12. As usual, you’ve got it all wrong. The last thing we need in a dying economy is more government intervention with a growing & insatiable demand for more and more tax money. The only way to quell the government’s habit of continued wasteful spending through the creation of new, expensive, and endless growing social programs to alleviate all perceived ills in society is to stop giving the government any more money to spend. We also need to shred the government’s credit card to keep it from creating a worse debt crisis.

  13.  The real question should be, how will taking money from people who shop at your store affect you? This just anothe progressive feel good policy and at the rate Obama is spending will be like a grain of sand.

  14. ” Higher taxes now WON’T help the debt but WILL kill jobs.”

    Thats why we don’t need another Republican to Spend us into Debt Oblivion with senseless wars while giving Tax Breaks during a good economy.

    ” BHO cannot step away from his far-left, punish-success ideology… it’s that simple.”
    It makes moresense than punishing the Miserable and sick  for being POOR!

  15. Hey,Dullbutt and Fried,

     Have either of you ever created a JOB ?

      Does me doing well cause you to do poorly?

    If  me and mine pay 80% of all the taxes collected by the IRS, how much more do you think would be my fair share?

     Are the 47% who pay no taxes paying their fair share. ?

    We are waiting breathlessly for your answer.

  16. Don’t buy the poll.  That’s people from away living in a faux Maine bubble, not native Mainers.

  17. He put all of Bush’s supplemental spending on the books!

    Wars, and Social Security Advantage, the “for profit” Social Health Insurance, then he had to Prime the pump with a stimulus to get the “Bush “economy from a total meltdown!

    He stopped the “second” great recession from occuring with that spending!

    You gotta do what you gotta do!

    Now it his, let him straighten it out!

    Trickledown didn’t work its time for a change!

  18. It has been shown that both public and private debt produce a drag on the economy. Once the government debt reaches the GDP level, the government is in danger of not being able to pay back its debt like we are seeing in some countries in Europe where inflation has started to take its bite and government has no choice but to pay higher rates just to service the debt. And printing money is not the answer because that creates inflation. Those are uncomfortable facts for those who want government to make a living for them because the government then has to make serious decisions about cutting back programs it can no longer afford.

  19. How much time do you expect the average American to wait until BHO straightens out the mess? Another four more years? He promised in the last election he would cut the deficit in half instead of nearly tripling it, he promised 6% unemployment rate instead of 8.2%, and he promised not to raise taxes instead of introducing 21 new taxes in ACA and instead of allowing the Bush tax cuts to remain in operation for everyone except for  those who normally create jobs and wealth. He was elected on the promise to improve the economy but did nothing to advance it in his first two years in office when he had a rare opportunity while his party was in full control of both houses of Congress to pass virtual any bill his party would support. The fact is that he paid little heed to the economy when Americans’ first priority when he was elected was to see his failed promises go through successfully. In short, he let the American public down.

  20. It’s consistent with national polls, all of which show majorities want increased taxes on people making over $250,000. These are marginal rates, so the higher tax only affects the income above that amount. 

  21. Talk about loaded questions:


    4* Which would you prefer – a one-year extension of the Bush tax cuts for everyone who makes less than $250,000 a year or a permanent extension of the Bush tax cuts for all Americans?”
    An equal comparison of both options would be 1 yr. extension of all Bush tax cuts or a 1 year extension of only those for people making less than ……

    Never thought I’d be critical of a Rasmussen survey till I read this. My impression is that a majority of respondents only wanted a temp. extension of all cuts and only a small percentage wanted to engage in class warfare.

  22. Obama’s goal is to increase revenue by increasing taxes on all citizens – not just the those earning $220,ooo or families earning $250,000.  He is taking the high road by claiming to veto any bill sent to him to extend the Bush tax cuts.  End results the Bush tax cuts expires and those of us that actual pay taxes will pay more.

    His next step will to blame the Republicians and radical Tea Party wing of the party.  This president plays fairness song while all along achieving his goal of increase revenue. 

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