I commend the Senate for passing the tax relief measure yesterday (HR 4853 - Tax Relief Compromise), and I hope that the House passes it today.
According to the CBO, this bill comprises $136 billion in additional spending and $721 billion in tax relief. That means fifteen percent of this bill is spending – the other 85 percent is tax relief:
• No across the board increase in income tax rates next year.
• No AMT biting deeper into middle class families.
• A Death Tax that’s a third less of what it would otherwise have been -- threatening far fewer family farms and family businesses with extinction.
If this relief fails, when the ball drops at Time Square on New Year’s Eve, Americans will have just been walloped by a tax tsunami the likes of which we haven’t seen since Smoot-Hawley.
Families and small businesses will be spending the New Year struggling to pay thousands of dollars of new taxes. A family making $50,000 will see at least $3,000 more taken from its paychecks. A small businessperson whose shop makes $300,000 will have to cut another $8,400 – perhaps the difference between a part time and a full time job for an employee.
From the Left we’re told that we should raise taxes on the very rich who make over $200,000 because they don’t pay their fair share.
According to the IRS, those folks earn 36 percent of all income; they pay 49 percent of all income taxes.
A lot of them aren’t people at all -- half of the income earned by small businesses will be hit by these tax increases. These are the job generators that we’re depending upon to end the nightmare of unemployment for millions of American families. To confiscate billions of dollars more from them and expect more jobs to come of it is simply insane.
Some of my fellow Conservatives object to the 15 percent of this bill that spends money we don’t have. I agree.
But that damage can be corrected through offsetting spending reductions next year. The new Republican House majority can do so without the Senate or the President – simply by refusing to appropriate funds – and it’s committed to doing so.
But it cannot rescind the taxes next year without the Senate and the President, who have made their opposition to just such a clean bill abundantly clear.
And even if such a retro-active bill could be passed by Spring, these families and businesses won’t get their tax overpayments refunded to them until they file their returns a year later.
Massive tax increases under Hoover turned the recession of 1929 into the depression of the 1930’s. Let that not be the epitaph of this Congress.