Part of the much-praised tax cuts signed into law includes a provision to triple the taxes on teenagers who have savings acounts for college, and even higher on the interest generated, according to a report in the NYTimes.
Claims are made that nearly $2 billion in revenue over a 10 year period will be achieved. Taxes are to be applied retroactive to Jan 1, 2006.
Americans For Tax Reform and their president Grover Norquist, who got 256 members of Congress to sign a pledge not to increase taxes, says:
"Mr. Norquist, in an interview Thursday, said he was unaware that the bill raised taxes and tax rates on teenagers with college savings funds because "no one here noticed" the provisions. But Mr. Norquist called the bill raising taxes on teenagers with investment income "a technical violation of the pledge" and noted that his group opposes all retroactive tax increases. He pledged to immediately begin a campaign to have the tax increases rescinded"
I understand some children save change in piggy banks and some mythical Tooth Fairy leaves currency for teeth, too. Is it time for a Tooth Tax?