Politician: My tax reform plan will cut taxes by $600 to $1000 for low

Question

Politician:  My tax reform plan will cut taxes by $600 to $1000 for low-income families, increasing their take-home pay by anywhere from 10 to 15%. Clearly this plan will benefit low-income families.

Which of the following, if true, would most weaken the argument above?

A. The tax reform plan would cut taxes by an even larger percentage for middle- and high-income families.

B. Rent in low-income areas has increased by approximately 20% over the last 10 years.

C. The tax reform plan will eliminate a food subsidy program that granted low-income families $100 per month in food vouchers.

D. Recent polls show that, while the tax reform plan has the support of over 60% of high-income families, it is supported by less than one-third of low-income families.

E. Economists are unsure what effect the tax reform plan will have on the unemployment rate.

pushpitkc · Answer

The argument talks about cutting taxes for low-income families, which indirectly increase the take-home pay.
It also states that this plan will benefit low-income families. If we are able to show that implementing this plan 
does not benefit the low-income families in some way, we can weaken the argument.

Option C(The tax reform plan will eliminate a food subsidy program that granted low-income families $100 
per month in food vouchers)  does just that and is the correct answer.

sananoor · Answer

Between B and C, C is better. 
B talks about increased rent in last 10 years so one cant conclude that how much rent is increased this year or will increase next year

lostin · Answer

Politician:  My tax reform plan will cut taxes by $600 to $1000 for low-income families, increasing their take-home pay by anywhere from 10 to 15%. Clearly this plan will benefit low-income families.

To weaken above argument, we need to find if there is any catch for low-income families under the new tax plan which will either harm or mitigate the benefit mentioned in the argument.

A. The tax reform plan would cut taxes by an even larger percentage for middle- and high-income families.
 Tax plan may be better for middle income but low-income families are still benefitting.

B. Rent in low-income areas has increased by approximately 20% over the last 10 years.
 Increase in rent is irrelevant in this case. If tax plan is doing some good, above argument still hold.

C. The tax reform plan will eliminate a food subsidy program that granted low-income families $100 per month in food vouchers.
 Correct answer - Tax plan is taking away something from low-income families. 
 It is given that they will lose around $100/month ( $1200/year). As per original argument families will save $6000-$1000/year ( taxes saving are mostly mentioned annual basis) so overall no benefit to low-income families.

D. Recent polls show that, while the tax reform plan has the support of over 60% of high-income families, it is supported by less than one-third of low-income families.
 no information about drawback for low-income families, support from any group not so useful.

E. Economists are unsure what effect the tax reform plan will have on the unemployment rate.
 no information about unemployment and low-income families available.

anshriv91 · Answer

I narrowed down to B and C. 
B is also a weakening the statement,right? Even when the take home is increased after the new tax reform, the families have to pay more money in the rent.
Hence, although the take home pay will increase, the spending will be increased and in nutshell no benefits.

Can anyone explain why B is wrong?

lostin · Answer

To weaken above argument, we need to find if there is any catch for low-income families under the new tax plan which will either harm or mitigate the benefit mentioned in the argument.

A. The tax reform plan would cut taxes by an even larger percentage for middle- and high-income families.
Tax plan may be better for middle income but low-income families are still benefitting.

B. Rent in low-income areas has increased by approximately 20% over the last 10 years.
Increase in rent is irrelevant in this case. If tax plan is doing some good, above argument still hold.

C. The tax reform plan will eliminate a food subsidy program that granted low-income families $100 per month in food vouchers.
Correct answer - Tax plan is taking away something from low-income families. 
It is given that they will lose around $100/month ( $1200/year). As per original argument families will save $6000-$1000/year ( taxes saving are mostly mentioned annual basis) so overall no benefit to low-income families.

VeritasPrepBrian · Answer

Just to expand a little more on why B is irrelevant: note that the rent increase is not part of the politician's plan. That increase has been happening independently, regardless of whether the plan is implemented or not. So it's essentially a "sunk cost."

It's like if your b-school tuition were to go up by $5,000 per semester, and your grandmother sent you a check for $500 "to help you with tuition." You couldn't say that your grandmother didn't help you! It didn't account for all of the tuition increase, but without her $500 you'd be worse off than you are with it. That's the politician's argument (if you include the information from choice B) - his plan still helps you, even if other circumstances are working against you at the same time.

With choice C, it's the plan taking away the subsidy program, so the net effect of the plan is that you're worse off...the plan is an active participant in reducing people's standard of living in C, whereas in B its only role is as a net positive.

srinjoy1990 · Answer

"Politician: My tax reform plan will cut taxes by $600 to $1000 for low-income families, increasing their take-home pay by anywhere from 10 to 15%. Clearly this plan will benefit low-income families."

I think annual increase is an assumption under the given circumstance and should be stated in the question. If we do not assume annual increase, option C is incorrect since, the same increase can happen on a monthly basis as well. If so, then $600 increase in one programme compensates for the loss of $100 in another (People can still profit).

Bunuel · Answer

VERITAS PREP OFFICIAL SOLUTION:

This weaken question concludes that the tax reform plan will be good for low-income families, and cites as evidence the fact that those families will have their taxes cut and see an increase of up to $1,000 in take-home pay. To weaken that argument, then, you would need to find a downside. What if, for example, the $1,000 in new money was offset by the loss of $1,000 or more of existing money? Choice C provides exactly that weakness: counterbalancing the up-to-$1,000 in new money is $1,200 ($100 per month) in lost food subsidies. Low-income families would be losers of $200-600 under this plan.

Choice A is incorrect - just because the plan would be even better for high-income families does not mean that it would be bad for low-income families!

Choice B is also incorrect: that rent increase is essentially a "sunk cost" - that money would have to be spent regardless of whether the tax cuts happen or not. The conclusion isn't that people would be overall better off than they were 10 years ago because of the tax reform, but instead that the tax reform would be better than not having the tax reform.

Choice D, too, is incorrect. That low-income families do not support the bill does not mean that they wouldn't benefit from it. They could oppose it on principle - they're philosophically opposed to tax cuts - or because they want to hold out for an even more beneficial package. Or they just might not like the politician who created it.

And choice E is incorrect, also. The uncertainty of economists is not enough to say that the tax reform plan would not help low-income families. The correct answer is C.

sarim89 · Answer

For answer C to be correct one has to assume that the reduction in taxes and increase in pay-out for low income families is for an entire year, since this wasn't mentioned i clicked E, but clearly that assumption need to be taken into account.

jaisonsunny77 · Answer

The conclusion: The tax reform will benefit the low income families.

Since we have been asked to weaken the conclusion, we need to find an answer choice that introduces an undesirable effect of these tax reforms on the low income families.

Let us now take a look at the available answer choices:

A.  The tax reform plan would cut taxes by an even larger percentage for middle- and high-income families.  - we are  concerned with  the effects of the tax reforms on the  low income family category only . (A) is irrelevant to the conclusion drawn. hence,  eliminate (A)

B.  Rent in low-income areas has increased by approximately 20% over the last 10 years.  - Even if this were true, it could still be true that the low income families now have more take-home money as a result of this tax reform. Hence,  eliminate (B)

C.  The tax reform plan will eliminate a food subsidy program that granted low-income families $100 per month in food vouchers.  - this introduces an undesirable consequence of the tax reform program. As a direct consequence of the tax reform implementation, an essential food subsidy program has now been taken out of action. This also takes away the $100 per month food vouchers that the low income families used to receive. Hence, (C) directly weakens the conclusion cited. Therefore,   (C) is the right answer choice.

D.  Recent polls show that, while the tax reform plan has the support of over 60% of high-income families, it is supported by less than one-third of low-income families.  - Does not weaken the cited conclusion at all. Hence,  eliminate (D).

E.  Economists are unsure what effect the tax reform plan will have on the unemployment rate.   - Irrelevant. hence,  eliminate (E)

Bambi2021 · Answer

Yes, yes, and yes. I assumed that 1000$ was per month. Given it was per year, the question becomes very easy.

Obviously also, A has to be a correct answer. If high-income families will get even more extra money, then their power to buy stuff will increase more and they will be less affected by a raising inflation that might result from the fact that people, and especially wealthy people, get more money in their pockets.

Prriyanka · Answer

Hi Everyone,

If we change option (B) to -> Rent in low-income areas has increased by approximately 20% over the last few days.
CAN IT BE CORRECT THEN?

-Prriyanka

0Lucky0 · Answer

Yeah. In my opinion, this question is a flawed question for the following reasons:
1) You can't just assume that taxes are annual. Wasn't mentioned in the stimulus. GMAC would never do such a thing!
2) Tax increase has been happening anyways so we shouldn't pay attention to B. Really? Well, plenty of things are happening anyways. We can't just assume stuff out of the blue.

Completely flawed question!! This should be deleted!!

Politician: My tax reform plan will cut taxes by $600 to $1000 for low

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Politician: My tax reform plan will cut taxes by $600 to $1000 for low

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