Senator McCain has used Senator Obama’s conversation with “Joe the Plumber” as the basis for the assault on Senator Obama’s plan to increase taxes on those making more than $250,000 while at the same time reducing the taxes of middle class taxpayers. Although Joe is in the middle class, he has said that if he is successful in buying a plumbing business and making more than $250,000, he does not want Senator Obama taxing him at a higher rate. ...
As a result of Senator Obama’s discussions with Joe, Governor Palin has referred to Senator Obama as a “socialist,” and Senator McCain has referred to him as the “Redistributor-in-Chief.” Surprisingly, these pejorative labels are directed at a policy that would reverse tax cuts for the wealthy enacted at the urging of President Bush and initially opposed by Senator McCain who said the following in 2001: "I cannot in good conscience support a tax cut in which so many of the benefits go to the most fortunate among us, at the expense of middle-class Americans."
What would happen to Joe if he were successful in buying the business and making over, say, $350,000 per year? Under the current Internal Revenue Code, for each $100 Joe earns over $350,000, he would pay a tax of $35. Under Senator Obama’s tax plan, for every $100 Joe earns over $350,000, he would pay a tax of $39.60. Thus, Senator Obama’s plan would tax Joe an additional $4.60 for each $100 Joe makes over $350,000, and this $4.60 is the basis of the argument around Joe the Plumber.