The Register-Guard
Eugene, Oregon

April 14, 2005
http://www.registerguard.com/news/2005/04/14/ed.col.morgantaxes.0414.html

By Sandra Morgen
and Linda Basch

The April 15 IRS deadline provides the nearly one-half of taxpayers who are women an opportunity to think not only about how to best fill out their 1040s, but also about policies and laws damaging to their financial stability. When it comes to this country's tax system, it's time for women to take a stand.

Recent shifts in wealth and income - people in the top 1 percent now claim more income than the bottom 100 million Americans combined - have caused tremendous economic strains on low- and moderate-income families, including those headed by women. More women than ever find themselves struggling to make ends meet, not because they don't have good money sense or went on shopping sprees, but because wages are too low and the tax system is weighted in favor of the wealthy and of large corporations.

While the sales pitch for tax relief is enticing, it's like a late night infomercial: It's too good to be true. In fact, tax cuts have cost women and children dearly.

President Bush continues to sell his tax cuts as a benefit for the middle class, yet the big winners were the wealthy and large corporations, where women are underrepresented. In the 20 percent of households with the highest incomes in 2003, about 40 percent are women. But 60 percent of taxpayers in the bottom 20 percent of households are women.

Recent tax cuts followed two decades of tax policies that have shifted the tax burden downward. A growing share of the tax burden is now shouldered by the middle class, and, surprisingly, by lower-income families. Corporations made out well: in 2002 and 2003, corporate tax receipts fell to their lowest level since the 1930s, except for one year in the early 1980s.

As we discuss in our forthcoming report, "Taxes Are a Women's Issue," the 2001 tax cut gave middle-income earners about $647. Compare that to a $34,992 average cut for the top 1 percent and a whopping $123,595 cut for millionaires - five and a half times the $22,635 annual income for a typical single mother.

These tax cuts are translating to enormous cut in public education, roads, libraries, public safety and programs that help millions of families with health care, child care, and housing. In fact, the Bush administration's proposed budget for 2006 calls for cuts in nearly all domestic social programs, including many that help middle class families.

The president's current budget proposal forecasts the loss of child care for 300,000 low-income children. Pell Grants to assist with college costs are slated to be frozen for the third year in a row. Cuts in programs that help feed women and children will affect over 740,000 families.

And since a proportionately larger number of women work in public agencies, they are the ones who face job losses when programs are cut.

While policymakers recently made improvements in the tax-related marriage penalty, women are actually hurt more by the declining progressivity of the tax code. When tax laws tilt so much in favor of income groups in which women and children are under-represented, we reap few gains and we pay dearly.

Most families rely heavily on women's income. Yet women are typically paid less, have more part-time employment, have more interrupted career paths, have primary responsibility for child care and elder care, have fewer economic resources and live longer. When there is only one income, especially in single-parent families, it is even harder. Add it all up, and women and their families are harmed when tax policies fail the majority in terms of fairness and adequacy.

We need an honest national discussion of the role that government and taxes play in all our lives - providing security, educating our population, promoting health and well-being and serving other critical needs. We need to understand how tax policies disproportionately affect different groups in society, including women, children and racial minorities. We need to go beyond glib promises of tax cuts to focus on tax fairness and ensuring adequate revenues for critical public services and programs.

There is time. A new Bush-appointed tax commission is considering an overall of the tax system. Let's tell the commission what matters to us. And let's be sure elected officials develop a sound and balanced tax policy that concentrates more on the well-being of a nation than the wealth of a few.

Sandra Morgen is director of the Center for the Study of Women in Society at the University of Oregon. Linda Basch is president of the National Council for Research on Women in New York. Their report is slated to be released in the next month.