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Hip, hip … well, let’s hold the “hooray” for now.
In the latest round of the fiscal cliff slugfest between Congressional leaders and the President, the House approved an alternative package to the spending-restraint “sequester” triggered by the Budget Control Act of 2011. But Speaker John Boehner (R-OH) threw in the towel on his “Plan B” to address expiring tax provisions.
NTU weighed many factors in its stance toward Plan B, which had much to recommend it: making permanent the 2001 and 2003 taxpayer relief laws for all Americans with taxable incomes below $1 million, cementing the “patch” that protects millions of families from paying the dreaded Alternative Minimum Tax, maintaining parity for dividend and capital gains tax rates, and providing a 35 percent death tax rate with an indexed $5 million exemption. All told, it was far and away a better alternative to President Obama’s calamitous scheme to raise taxes on a much broader scale, boost rather than curb various categories of federal spending, and condemn future generations of Americans to trillions more in debt.
Still, Boehner’s plan did open the door to higher taxes on job creators who declare their business income on 1040 forms; how much further that door would have swung open as the package moved through negotiations is anyone’s guess. Plus, Plan B’s omission of budget and entitlement reforms raised questions about what would accompany it – questions to which taxpayers had partial answers at best.
NTU is not among those who believe that to get the best deal, we should be willing to fall off the fiscal cliff. But at the point where it was being brought to the House floor, taking a pass on Plan B was the best among two difficult choices. As NTU has been reminding Members of Congress, even at this late hour there’s still time to avoid all the adverse tax implications associated with the fiscal cliff, redirect attention to specific spending reductions, and more aggressively commit to entitlement as well as fundamental tax reform.
Are we punch-drunk? No, especially if leaders on both sides of Pennsylvania Avenue read up on the history of fiscal consolidations done the right way, recognize the economic dangers of high taxes, and realize that serious spending reductions are the most effective way to keep our nation’s financial standing in the world from slipping further.
Read “Fiscal Cliff Part 2: Real World Solutions” for practical ways our leaders can overcome the stumbling blocks, and the priorities taxpayers should keep fighting for in the weeks and months ahead.0 Comments | Post a Comment | Sign up for NTU Action Alerts
The Late Edition: December 17, 2012
President Obama and Speaker Boehner met in person this morning to discuss a possible compromise on the Fiscal Cliff.
Watch Pete Sepp on Fox Business discussing the consequences of the Fiscal Cliff.
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Subscribe to NTU's podcast "Speaking of Taxpayers" via iTunes HERE!
This week NTU released a letter signed by 186 (with late sign ups) economists warning Congress against "Fiscal Cliff" tax hikes. Signatory to the letter, and author of the new book "A Capitalist Manifesto", Dr. Gary Wolfram of Hillsdale College joins Pete & Doug to discuss both!
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The Late Edition: December 13, 2012
Today’s Taxpayer News!
Earlier today NTU’s Pete Sepp joined the Competitive Enterprise Institute and a collation of fiscally conservative groups in a press conference to urge Congress to let the Wind Production Tax Credit subsidy expire.
A review of the 5 news taxes associated with ObamaCare which will kick in on January 1st, costing taxpayers a whopping $1 trillion over the next ten years.0 Comments | Post a Comment | Sign up for NTU Action Alerts
The Late Edition: December 12, 2012
How much does your state rely on the federal government for subsistence? Check out this article from the Tax Foundation detailing federal aid to state budgets.
Those seeking to raise taxes often cite the billowing debt to support their calls for new revenue. However, according to new numbers from the minority side of the Senate Budget Committee, 75% of the tax revenue in the President’s Fiscal Cliff proposal would go to new spending, not to pay down the debt. See the chart below from the Weekly Standard using CBO and OMB data:
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The Late Edition: December 10, 2012
Last week Sen. Jim DeMint (R-S.C.) left Congress to join the Heritage Foundation. DeMint has earned straight “A” grades from NTU Rates Congress for his outstanding commitment to protecting taxpayers’ wallets since he was first elected Senator in 2005.
Without a deal on the Fiscal Cliff, many state budget officials are concerned about the ambiguous future of funding and calling for Congress to act.
President Obama attempted to sell his tax increases on upper-income earners in Michigan today, and still shows very little flexibility on yielding to GOP calls for spending cuts as part of any debt deal to avoid the Fiscal Cliff.0 Comments | Post a Comment | Sign up for NTU Action Alerts
The Late Edition: December 6, 2012
Today’s Taxpayer News!
Pete Sepp weighs in on Rep. Shelley Berkley’s roughly $37,000 per-year pension, compliments of taxpayers.
This article from Newsday has more details on the impact of Obama’s tax proposals and how they affect middle-income Americans.0 Comments | Post a Comment | Sign up for NTU Action Alerts
Sen. Vitter and Rep. Pompeo Launch Opposition to Proposed Carbon Tax
Members of Congress are trying to hang their hats on anything that might help them avoid making any serious spending cuts ahead of the looming “Fiscal Cliff.” Among the many truly bad ideas that are being floated all in the name of raising “revenue,” as if there was any tax large enough to get us out of the hole our unbridled spending has dug, is a potential carbon tax. While past carbon tax proposals, aimed at curbing greenhouse gases, have also included components aimed at revenue neutrality and other ways to mitigate the regressive nature of such a tax, the current carbon tax talk is pure cash grab.
Senator Vitter (R-LA) and Representative Pomeo (R-KS) have introduced concurrent resolutions opposing such a carbon tax in an effort to get ahead of the harmful tax. As they state in a join press release here, a carbon tax would have a detrimental effect on taxpayers and our already struggling economy:
“There’s a lot of talk in Washington about raising taxes, and finding ‘revenues’ in creative ways, to avoid going over the fiscal cliff,” Vitter said. “But a carbon tax – which would force more financial hardship upon family budgets, energy consumers and job seekers – needs to be completely taken off the table. Our resolution would enshrine that.”
There’s virtually no part of the economy or everyday life that wouldn’t be negatively impacted by a “revenue-raising” carbon tax. For consumers it would mean higher costs on everything from food and manufactured goods to transportation and heat for the winter months ahead. This would be a massive burden on our economy and would further slow what little growth we have.
Instead of looking for quick cash gimmicks that will only hurt in the long run, Congress needs to make substantive spending cuts and reforms to put us back on the path to long-term prosperity. Higher taxes rarely bring in the revenue that was expected and at the end of the day, we’ll still be left with a growing debt and no one left to tax.
For a good reminder of just how urgently we need to cut spending and what little higher taxes will do, check out this new video from NTU.1 Comments | Post a Comment | Sign up for NTU Action Alerts
Mr. President, the Government Grinch is Stealing a Lot More than Christmas
Today, the President appeared in Pennsylvania as part of a new twist in his push for tax hikes on the American people: ginning up concerns over ‘holiday spending’, calling for new outlays, and contriving a fear of middle class income tax hikes highlighted by the “#my2k” social media campaign. The National Taxpayers Union (NTU) is calling this a disingenuous move from the political playbook, designed to divide America’s taxpayers.
NTU Executive Vice President Pete Sepp weighed in: “It is clear that the President’s pro tax-and-spend tour is an unfortunate move that will feature narrow claims about holiday consumer spending being reduced, even as immense budgetary challenges have taxpayers so concerned for their futures.”
The President’s claims, and those from a recent Council of Economic Advisers (CEA) report, don’t tell the whole story:
Blowing fear of middle class income tax hikes out of proportion to divide taxpayers. In his remarks the President admitted, “both parties agree we should extend the middle class tax cuts.” So why make this the focus of a campaign-style appearance? To divide taxpayers and possibly create a situation where inaction would lead to a set of tax hikes you want.
If tax uncertainty is a problem for sub-$250,000 per year income, why is it not a problem for those over $250,000? The CEA report that was released this week correctly notes tax hikes on income under $250,000 a year would have devastating economic consequences (in 2013 though); why they do not extend that logic to income above $250,000 is a mystery. In fact, according to an analysis reported in 2010 in The New York Times, 1 out of every 3 consumer dollars is spent by households earning more than $210,000! If the President is truly concerned about holiday spending, he’s leaving out a big piece of the pie.
The CEA’s own report does not particularly back up the President’s ‘holiday consumption’ concerns. Their report points to the Retail Federation’s prediction that spending would increase 4 percent this holiday season; and they place the greatest fallout from the income tax hikes in 2013.
Why wait until the last minute? Delays will affect tax filing season. Common sense dictates whatever damage uncertainty was going to inflict, it likely already has for consumer spending in 2012. However, the delay means the IRS is making contingency plans for the tax filing deadline; and assumptions about what the tax code is going to look like in 2013. This includes the assumption the AMT patch will go through; a probability the CEA does not reflect in their report.
MORE Spending?!? Tax hikes would be woefully inadequate for the task of deficit reduction the President is setting out for them, but now the President wants to make it a moving target with $50 billion in new “stimulus-style” spending. It’s true, the economy is weak, but a better solution would be NOT hiking taxes!
It’s not about your “$2k”, it’s about your “$53k” share of the national debt. Without the sequestration cuts going through, entitlement reform, and an end to constantly raising the debt ceiling, tax hikes on anyone will cause short-term economic harm. And, the lack of long-term budgetary discipline will result in more fiscal calamity and revenue grabbing in no time.
“The President seems to have become interested in aspects of supply side economics, but for only one segment of taxpayers,” said Sepp. “That’s one big reason why his claims don’t hold up under investigation – all of America’s taxpayers deserve relief from a burdensome tax code and out-of-control spending.”0 Comments | Post a Comment | Sign up for NTU Action Alerts
The Late Edition: November 28, 2012
Today’s Taxpayer News!
President Obama has unveiled his ‘Christmas Campaign’ which essentially attempts to sell higher taxes on upper-income earners to the public in an attempt to avoid weak holiday sales.
Even higher prices at the pump come January 2013? Congress is considering raising the federal gas tax to avoid the fiscal cliff according to News Max.
Song artist Katy Perry joined NTU and other taxpayer advocacy groups in opposition to the Internet Radio Fairness Act which would further distort the broadcast market.0 Comments | Post a Comment | Sign up for NTU Action Alerts