Tax Cut Debate

By: Stan Torgerson
By: Stan Torgerson

A Meridian accountant analyzed the tax cut plan just passed by Congress.

"I think it's a very family oriented bill," said Bob Rea, "particularly the families earning combined income of less than $100,000 and having children. This will be a real boon to them. A married couple without children, the only thing they're going to get really is a tax rate cut and some elimination of the marriage tax penalty for those who have two earner families."

Rea also said the top five percent of the population, in income, pay eighty percent of the taxes.

Pam Dew, owner and operator of the Children's Connection Day Care Center, said parents with two or more children are concerned with the cost of day care and this bill should help them.

"Quality child care does cost, you know, and I believe it would be beneficial to the parents to receive some tax cuts because there is not a lot of subsidized programs out there to assist in child care," said Dew.

Rea added there are also definite benefits for small businesses in the new tax code, particularly for those businesses just starting to grow.

Alabama expects a windfall from the federal tax cut bill that cleared Congress Friday. The bill includes $20 billion in aid to states.

Alabama officials aren't sure yet how much the state will get. But a Washington group that tracks federal legislation puts it around $270 million.

Gov. Bob Riley said the money will provide some immediate relief that's desperately needed. He said the money may allow him to make some changes in his $1.2 billion tax package.

But Riley cautioned that this is one-time money from Washington and it won't change the state's long-term financial needs.

The Associated Press contributed this report.

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