Joe the Plumber and Taxes

16 10 2008

From Dean Baker:

Much of last night’s presidential debate centered on “Joe the Plumber,” Joe Wurzelbacher, a plumber who Barack Obama met while campaigning in Ohio. According to the New York Times, Mr. Wurzelbacher says that he is planning to buy a plumbing business that has profits of between $250,000 and $280,000 a year.

While this income would put Mr. Wurzelbacher above the threshold where he could expect to pay higher taxes under Senator Obama’s tax plan, the increase in his tax bill would be relatively modest. Under Senator Obama’s plan, the tax on income above $250,000 would increase by 3 percentage points from 33 percent to 36 percent. This means that Mr. Wurzelbacher could expect to see his tax bill rise by between $0-$900, assuming that this plumbing business would be his entire taxable income. If he has additional taxable income, then he would see a larger increase in his taxes.

Whoa that sounds really burdensome for someone making $250k or more a year. Interestingly enough, Wurzelbacher is not even in that top 5 percent of the income earners to even be worried about such a hike.

Some are speculating whether or not Wurzelbacher was actually planted by the McCain campaign to portray Obama as a tax and spend liberal.

Here is the exchange between Joe the Plumber and Obama in case any of you missed it.

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