Why is the percent decrease in taxes for families in the $10,000 to $20,000income bracket 3.4% while these families receive only 1.3% of the tax cut?Give an example that shows this is possible. Two graphs representing the 1995 tax cut, New York Times, April 7, 1995.ON THE OTHER HAND…..Two Views of a Tax CutRepublicanMath: An EvenCut Acrossthe BoardHow much taxeswould fall forfamilies in eachgroupSource HouseWays andMeansCommitteeDemocraticMath: A SelectFew Get theBenefitsSHARE OFTAX CUTSShare of taxcuts assignedto eachincome groupSourceTreasury Dept2.3%3.4%0 to $10,000$10,000 to $20,0000.2% 1.3%3.9%$20,000 to $30,0000 to $10,000$10,000 to $20,0003.3%4.3% 4.4% 4.4%$20,000 to $30,000$30,000 to $40,00011.6%$30,000 to $50,0004.0%$40,000 to $50,000$50,000 to $75,000$75,000 to $100,00016.4%$50,000 to $75,000$200,000 and over$100,000 to $200,0003.7%15.2%$75,000 to $100,00023.4%3.7%28.1%$200,000 and over$100,000 to $200,000

Owing to the distributional consequences of the tax reduction, families in the $10,000–$20,000…

Answered: Why is the percent decrease in taxes…

Why is the percent decrease in taxes for families in the $10,000 to $20,000 income bracket 3.4% while these families receive only 1.3% of the tax cut? Give an example that shows this is possible.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

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Chapter1: Financial Statements And Business Decisions

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Question

Why is the percent decrease in taxes for families in the $10,000 to $20,000
income bracket 3.4% while these families receive only 1.3% of the tax cut?
Give an example that shows this is possible.

Two graphs representing the 1995 tax cut, New York Times, April 7, 1995.
ON THE OTHER HAND…..
Two Views of a Tax Cut
Republican
Math: An Even
Cut Across
the Board
How much taxes
would fall for
families in each
group
Source House
Ways and
Means
Committee
Democratic
Math: A Select
Few Get the
Benefits
SHARE OF
TAX CUTS
Share of tax
cuts assigned
to each
income group
Source
Treasury Dept
2.3%
3.4%
0 to $10,000
$10,000 to $20,000
0.2% 1.3%
3.9%
$20,000 to $30,000
0 to $10,000
$10,000 to $20,000
3.3%
4.3% 4.4% 4.4%
$20,000 to $30,000
$30,000 to $40,000
11.6%
$30,000 to $50,000
4.0%
$40,000 to $50,000
$50,000 to $75,000
$75,000 to $100,000
16.4%
$50,000 to $75,000
$200,000 and over
$100,000 to $200,000
3.7%
15.2%
$75,000 to $100,000
23.4%
3.7%
28.1%
$200,000 and over
$100,000 to $200,000

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