Republican presidential hopeful John McCain delivered an effective, albeit slightly subdued speech while accepting his party's nomination last night. The content of the speech centered around his experiences as the son of a general, a prisoner of war, and as a maverick legislator working in a bipartisan way to shake up Washington - all tenets of the campaign. As expected, McCain also made a point to highlight his desire to cut taxes, while stating his opponent, Barak Obama, wants to raise them.

"We believe in low taxes, spending discipline and open markets. We believe in rewarding hard work and risk takers and letting people keep the fruits of their labor...I will keep taxes low and cut them where I can. My opponent will raise them...I will cut government spending. He will increase it."

The tough tax talk is essential to winning over the republican base and painting Obama as a classic "tax and spend liberal," but the closer one looks, the more complex the tax situation becomes. Recently, the non-partisan Tax Policy Center examined the tax plans proposed by both McCain and Obama and found the differences to be less predictable than expected.

According to the Tax Policy Center, "both John McCain and Barack Obama have proposed tax plans that would substantially increase the national debt over the next ten years" without substantial budget cuts to accommodate them. Without budget cuts, at the current spending rate, "Obama’s tax plan would boost the debt by $3.5 trillion by 2018. McCain’s plan would increase the debt by $5 trillion."

Over a period extending from 2009-2018, TPC estimates that Obama's plan would decrease tax revenues by $2.9 trillion, while McCain's plan would reduce taxes by close to $4.2 trillion. But who is benefiting from these cuts?

Those affected by the cuts differ mostly at the upper end of the income spectrum. As expected, McCain would cut taxes across the board and give the biggest cuts to the highest-income households who currently pay the most. On the contrary, Obama would hand larger tax cuts to low and moderate-income households. He intends to pay for these cuts by increasing taxes on those making over $600,000 per year.

The Washington Post was kind enough to create an exceptional graphic of the tax plans. It clearly shows that both candidates intend to impose significant tax cuts, although Obama differs in his tax increase on the wealthiest groups.

According to the TPC, by 2012, under Obama's plan, middle-income taxpayers would be keeping five percent more of their paychecks, or nearly $2,200 annually. The cuts are paid for by the top one percent of earners who would face an average tax increase of $19,000 annually or 1.5 percent.

For that same wealthy group, the Maverick would cut taxes by 9.5 percent, increasing after-tax income by more than $125,000. Not leaving out the little guy, McCain would also decrease taxes for the middle-incomers by about 3 percent, amounting to $1,400 annually.

Both candidates also wish to keep the estate tax or death tax, which places a tax on estates passed down from the deceased to their heirs. The tax is dreaded by many as double taxation, since it taxes an estate that was already taxed when purchased and while owned. It's also notorious for breaking the banks of inheritants, who without cash on hand are forced to sell the estates just to pay the tax due on them to Uncle Sam. The current estate tax rate varies with the value of the estate inherited from 20-55 percent.

Obama wants to increase the estate tax rate to 45 percent with a $3.5 million exemption - anything under that amount does not get taxed. McCain wants that exemption higher at $5 million, and hopes to set the estate tax rate at 15 percent.

Of course, the differences don't end there. Businesses have much at stake in this election, like any other, and should be closely monitoring the tax proposals of the candidates. Thankfully, TPC has provided a breakdown of the various tax proposals of most interest to businesses. If you care not about them or the economy, this may be a good time to stop reading.

On business taxation, Obama differs from McCain the most. Obama wishes to increase the maximum tax rate on capital gains and qualified dividends to 20 percent, increase the payroll tax for those making over $250,000 (he has not provided additional details), and close tax breaks for multinational companies.

Both candidates want to eliminate tax breaks and subsidies for oil and gas companies and simplify the tax filing process in some form or fashion.

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