HART RESEARCH ASSOTESCIA Key findings from nationwide survey of 1,200 voters Conducted online June Prior focus groups conducted by Lake Research Winning The Tax Wars

Winning the Tax Wars – June 2012 – Hart Research Associates 2 % rating each as a very important goal* for reforming federal tax system Voters Say Tax Reform Should Be About Fairness, Not Lower Tax Rates Make tax system more fair Simplify tax system Maintain tax deductions for families (child credit, college tuition deduction) Keep taxes low Reduce tax rates on small businesses Reduce tax rates on all taxpayers * ratings on zero-to-10 scale, 10 = extremely important goal

Winning the Tax Wars – June 2012 – Hart Research Associates 3 By Any Name, Voters Are Ready To End High-End Bush Tax Cuts 71% 72% % who favor* each tax/budget proposal being considered by Congress * darker color = strongly favor End Bush tax cuts/ breaks for richest 2% of households End Bush tax cuts/ breaks for top 2% of households Increase tax rates on household income above $250,000 74%

Winning the Tax Wars – June 2012 – Hart Research Associates 4 Voters Want To End Bush Tax Cuts On Income Over $250,000 68% 32% The Bush tax cuts... are due to expire at the end of this year,... tax rates will increase unless Congress takes action. Which is the better way to deal with the Bush tax cuts? Continue the tax cuts for income under $250,000 but end them for income above $250,000 Continue the tax cuts for all income levels Feel strongly 59% Feel strongly 27%

Winning the Tax Wars – June 2012 – Hart Research Associates 5 Broad Support For Ending Bush Tax Cuts On Incomes Over $250,000 All voters Democrats Independents Republicans Men Women Income under $50K Income $50 to $100K Income $100K/more Northeast South Midwest West End tax cuts for everyoneEnd tax cuts for income over $250,000 68% 89% 69% 43% 63% 71% 68% 70% 71% 65% 69% 68%

Winning the Tax Wars – June 2012 – Hart Research Associates 6 Which Is The Best Reason To End The Bush Tax Cuts For Richest 2%? So that the wealthy pay their fair share of taxes To protect priorities like Medicare and education To get the federal budget deficit under control To make investments in roads, bridges, and schools to create jobs Voters who want to end cuts over $250,000 only 45% 21% 16% 12% All voters

Winning the Tax Wars – June 2012 – Hart Research Associates 7 (among voters who want to end tax cuts for income over $250K only) Reasons To End Bush Tax Cuts For Richest 2% The wealthiest people in our country have received the biggest tax breaks, and we just can’t afford to keep giving tax cuts to those who need it the least. The wealthiest people in our country have received the biggest tax breaks, and now it’s time for them to pay their fair share. If we give more tax breaks to the top 2%, we won’t be able to afford to protect middle-class priorities like education and Medicare from deep cutbacks. If we give more tax breaks to the top 2%, we won’t be able to bring the federal budget deficit under control and we will have to keep borrowing billions from China every year. Ending tax breaks for the top 2% will allow us to create jobs by investing in areas like education, research, and transportation. These tax cuts were always intended to be temporary, and we should let them expire now that the country’s needs have changed. This is a modest tax increase on the wealthy: a family making $300K would get to keep about $9,000 of their Bush tax cuts and lose only about $100. Very convincing* 72% 69% 43% 41% 35% 31% 30% * 6-7 ratings on seven-point scale, 7 = extremely convincing reason

Winning the Tax Wars – June 2012 – Hart Research Associates 8 Reasons To Keep Bush Tax Cuts For All Incomes The national debt was caused by out-of-control government spending, not low taxes. We should reduce the deficit by cutting wasteful spending, not raising taxes on the American people. Raising taxes on small businesses and job creators will hurt our economy and cost millions of Americans their jobs. The politicians may claim they are only raising taxes on high-income families, but once they start increasing taxes you know they will raise taxes on the struggling middle class too–and we just can’t afford that. Politicians raise taxes so they can keep growing the federal government. Until Washington starts respecting taxpayers’ dollars, we shouldn’t give them any more. The top 1% of taxpayers already pay almost 40% of all income taxes, while nearly half of all people don’t pay any federal income taxes at all. We shouldn’t penalize those who have been successful. Raising taxes only on those who have done well is class warfare, dividing America when we should be uniting the country. Very convincing* 52% 37% 34% 33% 16% 12% * 6-7 ratings on seven-point scale, 7 = extremely convincing reason (among voters who want to end tax cuts for income over $250K only)

Winning the Tax Wars – June 2012 – Hart Research Associates 9 The country needs more tax revenue to fund priorities like education, transportation, and Medicare Which one of these statements comes closer to your point of view? However, Many Voters Don’t Yet See Need For More Revenue The country does not need more tax revenue, we only need to reduce wasteful government spending Mixed feelings Strongly agree 24% 31% 57% Strongly agree 48%

Winning the Tax Wars – June 2012 – Hart Research Associates 10 After Extensive Debate, Support Holds Steady For Ending Bush Tax Cuts On Income Over $250,000 The Bush tax cuts... are due to expire at the end of this year,... personal income tax rates will increase unless Congress takes action. Which is the better way for Congress to deal with the Bush tax cuts? Initial view Final view Continue tax cuts for income under $250K, end for over $250K Continue tax cuts for all income levels

Winning the Tax Wars – June 2012 – Hart Research Associates 11 Public Also Wants Higher Corporate Tax Rates, End to Preferential Treatment Of Capital Gains  By more than 4-to-1, voters say that tax rates on corporations should by higher (60%) rather than lower (14%).  Fully 95% favor -- 74% strongly -- ensuring that all large corporations pay at least some income taxes.  69% favor (36% strongly) ending preferential treatment of income made by investors (stocks/bonds), so it is no longer taxed at a lower rate than income made by workers (wages/salaries).  While 46% say ending tax breaks that allow investors to pay lower rate than working people is a high priority for tax reform, just 27% prioritize taxing “income from wealth…at least as much as income from work.”

Winning the Tax Wars – June 2012 – Hart Research Associates 12 Successful Messaging for Winning the Tax Wars

Winning the Tax Wars – June 2012 – Hart Research Associates 13 % voters who strongly agree* with each statement Strong Language In Support Of Fair Taxes To get our nation back on track we need everyone to do their part, and that includes the wealthy and large corporations. With a $1-trillion deficit, the country simply can’t afford to keep giving out tax breaks to the wealthy and large corporations and still meet our pressing needs. We don’t begrudge financial success in this country; we admire it. But when the rich get tax breaks they don’t need and the country can’t afford, somebody else has to make up the difference–and that’s not right. Our tax code should reward hard work instead of giving special tax breaks to the privileged and comfortable who sit around collecting income on their wealth. 59% 53% 51% 47% * 9-10 ratings on zero-to-10 scale, 10 = totally agree We don’t begrudge success Don’t reward privileged/comfortable Democrats 63% 64% Independents 53% 43%

Winning the Tax Wars – June 2012 – Hart Research Associates 14 We Have An Opportunity – For The First Time In 30 Years – To Take The Offensive On Taxes  The combination of strong public demand for tax fairness and conservatives’ anti-tax absolutism creates an opportunity to go on offense against elected officials and groups that defend unpopular tax breaks for the rich and large corporations.  We can potentially discredit the Americans for Tax Reform pledge, and make it an electoral liability, transforming the politics of the tax issue.  The tax issue can become a wedge issue that divides the conservative coalition.

Winning the Tax Wars – June 2012 – Hart Research Associates 15 Voters Reject Tax Pledge That Protects Corporate Loopholes And Tax Breaks For Rich 32% About half the Members of Congress have signed a pledge promising that they will never vote for any tax increase. This pledge includes a promise that they will never vote to make the very wealthy and corporations pay a penny more in taxes, even by eliminating special tax breaks or loopholes. What is your view of those who signed this pledge never to raise taxes? FavorableUnfavorable 68% Very unfavorable 43% Very 9% However, 60% have a favorable view of a pledge not to raise taxes if we don’t say it applies to tax breaks and loopholes. Unfavorable: Democrats89% Independents73% Republicans43% Northeast73% South60% Midwest76% West72%

Winning the Tax Wars – June 2012 – Hart Research Associates 16 % who strongly agree* with each statement Position Republicans As Defenders Of Status Quo That Is Rigged Against Middle Class Too many politicians are willing to stack the deck in favor of their wealthy campaign contributors and corporate interests, while the middle class gets stuck with the tab. We need to stop wasteful spending in Washington, and that includes getting rid of wasteful tax breaks for corporate CEOs and billionaire hedge fund managers. Our current tax code is full of special deals for powerful interests, and it needs to be overhauled so everyone plays by the same rules. Today our tax system is rigged in favor of the rich and big corporations who can afford to hire lobbyists and tax lawyers, unlike the rest of us. 61% 59% 55% * 9-10 ratings on zero-to-10 scale, 10 = totally agree

Winning the Tax Wars – June 2012 – Hart Research Associates 17 % who say each raises very major doubts about Republicans in Congress Going On Offense Raises Major Doubts About Republicans In Congress Nearly every Republican in Congress has signed a pledge promising that they will never vote to make big corporations pay a penny more in taxes, even by closing loopholes that reward them for shipping American jobs overseas. Republicans in Congress voted for a tax plan that increases taxes on 18 million low-income working families, but cuts taxes by 30% for corporations and millionaires. Republicans in Congress passed a budget that ends the Medicare guarantee and requires seniors to pay $6,000 more per year for fewer benefits than they get now, while giving the richest Americans a $300,000 tax break. Republicans favor giving more tax breaks to the wealthiest Americans and large corporations while demanding cuts in programs that average families rely on, like Medicare, Medicaid, and college tuition assistance. Republicans are protecting huge tax breaks for the oil companies, even though these companies are gouging consumers and reporting record profit. Republicans favor keeping the policies that allow multimillionaire investors like Mitt Romney to pay a tax rate of just 14% – far below what many middle-class families pay. 48% 47% 46%

Winning the Tax Wars – June 2012 – Hart Research Associates 18 Voters More Concerned About GOP Protecting Wealthy/Corporations Than Cutting Investments Which concerns you more about the approach of Republicans on tax and budget issues? Cutting investment Protecting tax breaks for wealthy/ corporations Cutting middle-class investments like education, Medicare, and transportation Protecting tax breaks and loopholes that mainly benefit the wealthy and big corporations

Winning the Tax Wars – June 2012 – Hart Research Associates 19 Change In View Of Parties’ Handling Of Taxes Much better Somewhat betterDemocrats: Much better Somewhat betterRepublicans:No difference between parties Which party would do a better job handling the issue of federal taxes? 35% 41% 29% Initial View Final View even +12 Democrats

Winning the Tax Wars – June 2012 – Hart Research Associates 20 Summary: Taking The Offensive On Taxes  Use core message that the rich need to pay their fair share to win the fight over Bush tax cuts for the richest 2%, and to put fairness at the center of the coming debate over tax reform.  Portray GOP as defenders of a tax status quo that is rigged in favor of the rich and special interests.  Highlight foreign tax havens, tax breaks that send jobs overseas, and loopholes that let some corporations pay no taxes.  Discredit the ATR pledge to keep all loopholes, making it an electoral liability and transforming the politics of the tax issue.  Link GOP defense of tax breaks for rich/corporations to their demands for cuts in Medicare, education, and infrastructure.  Highlight GOP’s refusal to raise revenue, to undercut claim of fiscal responsibility & put them on wrong side of elite opinion.

Winning the Tax Wars – June 2012 – Hart Research Associates 21 HART RESEARCH ASSOTESCIA Key findings from nationwide survey of 1,200 voters Conducted online June Prior focus groups conducted by Lake Research Winning The Tax Wars