Bankruptcy Blog: May 1, 2005

Nowadays politicians’ favorite mantra seems to be “lower taxes.” Corporate taxes. Estate taxes. Taxes on millionaires. Taxes on working folks. The We-Hate-Taxes leadership in Washington says “cut ‘em all.”

This “No New Taxes” routine (with a little “No Old Taxes, Either” tacked on) has one glaring exception: A big tax increase on folks who are broke. The Bankruptcy Bill President Bush signed into law last week raised the fees on every family that files from $155 to $200.

What, you thought no one below median income would suffer? The new taxes, like almost every other provision in the bill, apply to everyone — no matter how low their income.

Newsletters
Get TPM in your inbox, twice weekly.
Your subscription could not be saved. Please try again.
Your subscription has been successful.

The (public) reason was to pay for 28 new judgeships created by the bill, but the numbers are a little off. The government estimates the five-year cost of the new judges at $25 million, but the government puts the five-year net revenues (from the fee increase alone) at about $150 million.

So will the fee be lowered? Of course not. That money will go where taxes usually go — straight to the general revenue coffers — fresh from the hides of people in desperate financial trouble.

Congress has kicked these families when they are down by passing a harsh new bankruptcy bill, and then kicked them again with a tax to fatten general revenues. Get sick? Lose your job? Trying to save your house? Boy, have we got a tax for you.

Latest Cafe
Comments
Masthead Masthead
Founder & Editor-in-Chief:
Executive Editor:
Managing Editor:
Associate Editor:
Investigations Desk:
Reporters:
Newswriters:
Director of Audience:
Editor at Large:
General Counsel:
Publisher:
Head of Product:
Director of Technology:
Associate Publisher:
Front End Developer:
Senior Designer: