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You can argue that this isn’t punishment. But I don’t think you can argue that this isn’t targeted or a clear expression of priorities. Churches aren’t being ta
by digitaltrees 9y ago
You can argue that this isn’t punishment. But I don’t think you can argue that this isn’t targeted or a clear expression of priorities. Churches aren’t being taxed here. They could have lost their tax exempt status. The Increase to the Child tax credit that would have helped low income families isn’t in the bill. There is no reduction in military spending to offset the cost. And it sure looks like the states most severely affected by removing the state tax deduction vote democratic. Especially since these states actually subsidize most of the other states through their much larger tax base and its contributions to federal tax that is redistributed to the rest of the country.
Let’s remember that grad students are now being taxed for money they never receive. It’s not like money is changing hands for tuition. If they were a business and the university paid them $100k they would be able to expense the tuition.
- leereeves 9y agoA grad student working a different job has to pay taxes on the income used to pay tuition, as does a student who borrows the tuition and repays it while working a different job in the future.(1) This is a very specific favoritism - not even favoring all grad students, but only grad students working for universities. And ultimately, favoring the universities by lowering their grad student labor costs. 1: Excluding some limited credits and deductions of at most a few thousand dollars each. Will graduate assistants be eligible for these?
- digitaltrees 9y agoWhat PhD program requires the payment of tuition?
- leereeves 9y agoWhat PhD program allows students who aren't working for the university as a teaching or research assistant and doesn't charge them tuition?
- digitaltrees 9y agoHow is that relevant. Grad students work because they are doing research relevant to their degree and are teaching so they can learn to be professors. It’s all part of the program. The get paid for their work and they pay tax on it. The government pays their tuition in the form of a grant or the university endowments pays the tuition because the university needs to cover operational costs. Tuition has nothing to do with a grad students income. The only reason they are invoiced for it is that represents their portion of the university operating budget.
- leereeves 9y agoTuition is part of the compensation graduate assistants receive for working for the university. There's no reason universities should receive special treatment here. They should pay their employees enough to live on, after taxes, like all other employers, and the fringe benefit of free tuition should be taxed like other fringe benefits.
- digitaltrees 9y agoIn what way is it compensation? So we should calculate sales tax based on sticker price rather than actual paid price? Grad students receive a salary for their work and a discount from the sticker price of the tuition. They are separate transactions.
- leereeves 9y agoThe transactions are tied: grad students have other (often much better) options for employment; they choose to work for a grad school because they value the free tuition.
- eli_gottlieb 9y agoNo, they choose to work in PhD programs because they value doing research.
- 9y ago
- leereeves 9y agoRegarding your comment that this is "targeted or a clear expression of priorities": I agree, and I would add that these tax deductions were also targeted when they were implemented. Both parties favor their constituents in a way that probably isn't healthy for the unity of the nation.
- digitaltrees 9y agoI don’t agree. This is simple accounting. It is the recognition that you paid an expense that lowered your income. It’s just like deductions for foreign tax payments. If you pay tax in Hong Kong because you live there you can deduct those tax payments on your federal tax now. Why are state taxes different?
- leereeves 9y agoBecause when you live in Hong Kong you don't live in the US. When you live in California you still live in the US.
- digitaltrees 9y agoThen why should I pay federal tax at all? And yet I do as an American citizen. And as a New Yorker I still pay federal tax. The government just acknowledged that my income was lower because I paid a state tax? How about red states start taxing their citizens to pay for their services rather than get subsidized by federal tax payers.
- leereeves 9y agoRed states pay lower state taxes because they don't want the government to do all the things blue states do. Why should red states subsidize all the things blue states pay for? The fairest system is to charge everyone the same federal tax rates. The usual objection is that blue states subsidize red states. Two problems with that. First, it isn't an accurate description of reality - some blue states are net recipients of federal funds, some red states are net payers. Second, most of those funds go to Democratic programs (entitlements) - so even if it were true, Democrats chose to do that.