Tax Analysts Blog

Tax.com Reader Survey: The People Have Spoken

Posted on Aug 23, 2011

Thanks to all the Tax.com readers who participated in our recent survey. It will be interesting to follow the events of the coming months and match the actual outcomes against the prognostication skills of our online community.

Our first survey question was about the congressional deficit reduction 'super' committee. The committee, as you will recall, is tasked with finding $1.5 trillion in deficit reduction measures and must present their plan by no later than November 23, 2011. Congress as a whole would then have until December 23, 2011, to approve the committee's plan on a clean up/down vote (no legislative amendments) or else $1.2 trillion in automatic spending cuts would be triggered.

A clear majority of participants, 59%, responded that the committee's plan would not gain Congressional approval, meaning those automatic spending cuts would take effect. A minority of participants predicted that Congress would approve the committee's plan, with 25% of you guessing the plan will contain both spending cuts and tax increases. The remaining 16% of you think Congress will approve a plan consisting of only spending cuts.

The majority view sounds reasonable given our political realities. The GOP-controlled House of Representatives seems unlikely to agree to any package containing tax increases. Likewise, the Democratic-controlled Senate seems unlikely to pass any plan consisting solely of spending cuts. Welcome to Washington in 2011: Compromise is out, stalemate is in.

Our second question involved events further out on your calendar. The Bush tax cuts -- which originally date back to 2001 and 2003 -- are scheduled to expire at the end of December 2012. That's a long way off, but their pending expiration casts a shadow over the near-term deficit talks. Eliminate the tax cuts for everybody and our nation's deficit issues largely go away, at least for a while. Problem solved, except for the fact neither political party wants that to happen.

The GOP wants the tax cuts extended for everyone in the country. The Obama administration wants the tax cuts extended only for families with taxable incomes under $250,000 per year, representing roughly 98% of the country. Although the two parties' positions overlap substantially, you would think they were polar opposites based on the acrimonious tone of the debate.

The Tax.com online community was more or less evenly divided among these three options. 35% of you predicted the tax cuts would be renewed for everyone (the GOP position), while 33% said the tax cuts would be extended only for the bottom 98% of wage earners (the Obama position), and 32% think the tax cuts will expire for everyone.

Thanks again for participating and keep your eyes peeled for future reader surveys on Tax.com.

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