WASHINGTON _ As the Monday filing deadline looms, miserable
taxpayers can find company among the affluent. Well-to-do
Americans' taxes surged 16 percent in 1993, the first year of
revisions pressed into law by President Clinton.
People who earned $100,000 or more owed the government an
additional $31 billion compared with 1992, according to an
Associated Press computer-assisted analysis of Internal Revenue
Service data. Everyone else together owed about $3 billion more.
The tax-law revisions were aimed specifically at reducing the
deficit by tapping people with big incomes. When President
Clinton proposed raising taxes on high incomes, experts expected
the affluent to create shelters and loopholes to blunt the
It didn't happen.
The law took effect in August 1993, but the new rules were
applied retroactively to January. That took some tax planners by
"We did not see a new surge of tax shelters," said Robert
McIntyre of Citizens for Tax Justice, a Washington advocacy
group. "It's hard to do, and it takes time."
Clinton had argued that upper-income Americans had paid less
than their share of taxes in the years when Republican presidents
Reagan and Bush sat in the White House.
He said the law asked "the well-off to pay their fair share,
requiring that at least 80 percent of the new tax burden fall on
those making more than $200,000 a year, and very little on any
other Americans, not to punish the successful, but simply to ask
something of the very people whose incomes went up most and whose
taxes went down during the 1980s."
The bill added two new tax brackets _ 36 percent for income
beginning at $115,000 and 39.6 percent beginning at $250,000 _
but generally left other tax rates alone.
While tax liability declined for people in many brackets, for
those making more than $100,000 it amounted to 25.5 percent of
their income before deductions, up from 23 percent the previous
year. The law allowed them to spread actual payment of their
taxes over several years.
The tax increases, while aimed at the wealthy, made no
distinction between taxpayers living in high-cost and low-cost
areas. Also, the bill didn't differentiate between single-income
and dual-income households.
Tax returns reporting $100,000 or more in income accounted for
just 4 percent of the 114.6 million returns filed for 1993. But
they amounted to 24 percent of the $3.7 trillion in individual
income reported. …