President's Tax Agenda Is Met With Lukewarm Support

[SGrande]

GREENBERG QUINLAN ROSNER RESEARCH INC 10 G STREET NESUITE 400WASHINGTON DC 20002 TEL: [phone] FAX: [phone]www.GreenbergResearch.com Date: July 15, 2003

http://www.greenbergresearch.com/publications/reports/PIP071503_r.pdf


To: Interested Parties
From: Stan Greenberg
Anna Greenberg
RE: TRANSFORMING THE TAX DEBATE1

We face a critical moment in the debate over the country’s tax system and its central relationship to the American economy. President Bush and the Republican Party have succeeded passing large tax cuts for the past two years while opponents have fought back largely by offering their own set of middle class tax cuts and domestic spending proposals. But the public is ready for a different debate: they are ready to reform the federal tax system to remove the unfair advantages of corporations and the wealthiest.
Voters are angry about taxes not because they think they pay too much, but because they think that the wealthy and corporations do not pay their fair share. In an environment of corporate scandals and tax cuts that largely favor the wealthy, voters are ready to rethink tax reform. Instead of an approach that would make the tax cuts permanent, the voters favor reforms that would close loopholes and tax shelters and make sure that the wealthy and corporations make a contribution to meeting our nation’s pressing domestic needs.
Main Findings
• There is lukewarm support for the Bush tax cut and the Republican approach to taxes.
• The voters are angry about taxes, not because they think their taxes are too high, but because the wealthy and corporations do not pay their fair share into the federal tax system.
• Voters support a set of changes to the tax system that close the loopholes and tax shelters used by the wealthy and corporations and raises Social Security taxes on the highest income earners.
• Voters favor a transformative Democratic approach to tax reform over President Bush’s agenda of permanent tax cuts.


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WHAT BOTHERS YOU MOST
(Percent Responding Most Bothersome)
Feeling that wealthy and corporations don’t pay fair share 46
The complexity of the tax system 31
Large amount you pay in taxes 14
When they think about the tax system as a whole, voters believe that corporations (60 percent)
and the wealthy (51 percent) are paying LESS than their fair share, but only 39 percent think that their own families are paying MORE than their fair share in federal taxes. A majority (57 percent), moreover, supports the principle that underlies progressive taxation, namely that “tax rates lowest for those with lower incomes and higher for those with higher incomes.”




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Transforming the Tax Debate Public Anger
The spate of corporate scandals over the past two years has fueled a great deal of anger in the electorate - only 26 percent of voters are favorable towards big corporations compared to 39 percent who are unfavorable towards them. Corporate misbehavior makes people angrier than the idea that government wastes their tax dollars and significantly more angry than the idea that poor people get handouts from the government without making a contribution in return.
4 Transforming the Tax Debate
The movement towards the Democrats on taxes comes from important swing voters in the electorate including Independents (23-point net shift towards Democrats), moderates (24-point net shift towards Democrats), older women (27-point net shift towards Democrats), and suburban voters (25-point net shift towards the Democrats).
BETTER JOB HANDLING TAXES
(Net Democrat-Republican) Before Presidential Statements After Presidential Statements Independents -4 +4 Moderates +2 +10 Older women +5 +11 Suburban voters -14 -3


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TAX DEBATE
President Bush says bold tax cuts are the best way to create jobs and economic growth.These tax cuts ensure that instead of wasteful government spending, the governmentgives money back to the American consumer and small business. It makes our systemmore fair by reducing the marriage penalty, helping low income children with the childtax credit and making sure we don’t tax the dividends seniors rely on.
The Democratic candidate says that we need to completely overhaul the tax system andreplace it with a system that is simple, fair and provides the resources we need to meetour nation’s serious challenges. We need a system that eliminates the tax loopholes andshelters that the wealthy and corporations use to avoid contributing their fair share. Weneed to tax income earned from interest, dividends and capital gains at a higher ratethan wages to make sure that everyone – rich or poor –contributes to investing in affordable healthcare, education and a secure retirement.
Bush much more 22
Bush somewhat more 17
Democrat much more 29
Democrats somewhat more 19
Total Bush 39
Total Dem 48

[papau]

1. Ending the wage cap on SS helps a lot. and reversing rate reductions

above the current 25% bracket (we kept the 10%, 15% and 25% brackets as is) completes the needed change - and we could even afford Dean or Kerry's Health plan at that point!