March 7, 2001
Repeal of the marriage tax penalty was always good for a big round
of applause in the campaign speeches of most political candidates last
year. But it's scheduled for bumpy sledding in the drafting of this
year's tax-cut bill.
"Marriage Tax Repeal" now considered by Congress treats fulltime homemakers like only 67% of a person. We call on Congress NOT to discriminate against homemakers.|
| Fulltime Homemakers are NOT 67% women!
The marriage tax is not verbally expressed as policy in any
statute but is buried in the numbers. It is a consequence of the fact
that our income tax tables treat a married couple as only 1.67 persons
instead of two whole persons.
Few people understand how the marriage tax functions or how it
should be remedied except the green-eyeshade number-crunchers. But
dollars are not all that matters; ideology is at stake in the drafting
of changes in the income tax law.
Is the purpose of cutting the marriage tax to accord long overdue
socio-economic respect for marriage as an institution fundamental to
our society and to the raising of children? Or is the purpose to
enable government to engage in national economic planning by using tax
policy to influence human behavior?
If the purpose is the former, then it follows that all married
couples with the same income should be taxed equally. If the plan is
to give a tax break to two-earner couples only, that will replace the
marriage penalty with a new homemaker penalty.
That's what's behind the controversy now going on behind closed
doors in Washington. Even those politicians who don't particularly
care about promoting marriage should be squeamish about discriminating
against one type of married couples in favor of another.
Last year's Congress dealt fairly with this issue by passing a
bill that taxed one-earner and two-earner married couples equally.
Bill Clinton showed which side he was on by vetoing the bill, and it
did not become law.
Unfortunately, the White House executive summary of the
President's tax-cut proposal calls for "reducing the marriage penalty
by reinstating the 10 percent deduction for two-earner couples." Not
only does this proposal give less relief than the bill passed by
Congress last year but, even worse, it would impose a new homemaker
penalty on one-earner couples.
Since the Bush tax cuts would be phased in over five to seven
years, for simplicity, let's consider what they would accomplish after
they become fully operative.
Let's say a married couple is struggling financially and needs
more income to support the family, perhaps because of the birth of a
child. What choices are available?
In one family, assume the wife takes a job and puts her children
in daycare. This couple would get a marriage tax deduction of 10
percent of her salary up to $30,000; that chops as much as $990 off the
family's federal income tax bill (at the new 33 percent top Bush tax
rate). In addition, this couple qualifies for the existing tax credit
for child-care expenses, which is worth up to $960.
Now consider another family where the husband moonlights at a
second job so his wife can care for their children at home. This
family will not qualify for either the new Bush marriage tax break or
the child-care credit that exists in current tax law.
The husband and wife surely work just as hard in this second
family as in the first. Why should they pay up to $1,950 more in
federal income taxes on the same family income?
Moonlighting at a second job is just one of several ways a husband
can provide his children with the benefits of a fulltime mother, and
avoid commercial daycare. The husband can work longer hours at his
first job; he can make the extra effort required to get a higher paying
job; he can go to school at night to train for a higher paying career.
Who are the bureaucrats who presume to use the tax power to force
traditional husband-breadwinner, wife-homemaker couples to subsidize
two-earner couples who hire paid child care?
The marriage penalty in the tax code is an immoral policy
regardless of one-earner or two-earner households. Giving a tax cut
only to two-earner couples would send the radical feminist message that
the government sees no value in a homemaker's work at home, that the
role of a "non-working" wife and mother is less socially beneficial (or
less worthy) than paid employment.
Disturbing emanations from the tax-writing process indicate that
this discrimination is not inadvertent. A leading economic adviser
praised the goal of inducing married women toward greater participation
in the labor force because that would increase our Gross Domestic
Product and yield a greater federal budget surplus.
Let's get this issue out on the table instead of concealing it in
the arcane depths of the tax tables. Let the American people decide
whether they want income tax policy to bolster the institution of
marriage OR to bolster the GDP by inducing more women to join the labor