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Posted on 07/14/2010 6:44:50 AM PDT by justsaynomore
All tax increases are bad, but there are some that are just plain unfair and punitive for no logical reason. The marriage penalty, the small business penalty, the retirement penalty, and the death penalty are in that category.
Everyone except the most clueless “mushrooms” of our society know that tax rates will return to 2000 levels if the Democrat-controlled Congress does nothing to stop them.
And they have shown a real skill for doing nothing but legislative carnage to this country in the last 18 months. That carnage has included the publicly unpopular Health Care Deform bill, the House-passed Cap and Trade and Tax and Kill (Jobs) bill, and the newly proposed Dodd-Frank Financial Deform bill. The full negative economic impact of those penalties on our economy continues to unfold.
Most people are equally unaware that these automatic tax increases come about because of a sunset clause in the 2000 tax decrease legislation. In order for the then Republican-controlled Senate to get enough Democratic votes to pass the legislation, they had to agree to the sunset clause. The Republicans were betting that the benefits of the tax cuts would be so obvious that the Democrats would not dare let them expire. The Democrats were betting that they could bad mouth the so-called “Bush” tax cuts enough that the “mushrooms” would believe the tax cuts were a big reason for our runaway deficits.
The Democrats won and they insured their bet by being the catalyst for exponentially escalating deficit spending. The Republicans got sucker punched by the Democrats again, because collectively they thought there was no way the Democrats would allow obviously unfair tax penalties to be re-instated. And just as the Democrats do not care if legislation is good or bad as long as it enhances their big government agenda, they do not care about fairness in the tax code.
Americans for Tax Reform reports that as of January 1, 2011 the standard deduction for married couples will no longer be double that for a single person. They are also penalized for having children, since the child tax credit will be cut in half from $1000 per child to $500.
Small businesses (Subchapter S corporations) will no longer be able to expense equipment purchases up to $250,000. The new limit will be $25,000 which is equivalent to a tax increase. To add insult to injury, their business profits will be taxed at the higher personal income tax rates, if they make a profit.
Many retirees work and save all of their careers to be able to retire on dividends on their savings, stocks and bonds. These dividends will no longer be taxed at the long-term capital gains rate of 15 percent. They will now be taxed as ordinary income at a top bracket rate of 39.6 percent.
The dreaded death tax will return to a 55 percent top rate on estates over $1 million. It does not take very long to be worth $1 million when you start adding up the value of your home, automobiles, savings, investments and even life insurance proceeds. “Selling the farm to save the farm” is back.
The reality of these punitive policies is that they will not generate a net increase in tax revenues, because they discourage taking business risks to create jobs, as well as marriage, savings and dying. We cannot stop dying, but we do not need to be unfairly killed by taxes while we are alive.
Even worse, we should not be killing an economy that’s already on life support.
That will surely happen if the Democrats do nothing.
Pinganator
Dems lose control of Congress in November 2010.
Tax cuts expire and stupid public doesn’t notice until 2011.
Republicans blamed.
go get ‘em, Herm!
The demonrats aren’t going to touch this until after the November elections. I hope that if the Republicans take back Congress...or at least the House...that they can put the tax cuts back into place and make them permanent.
If the Republicans don’t undo some of this Admin’s policies, then they’ll be made to pay too. They had better sit up, take notice, and listen...for a change.
It’s time to look up Jefferson’s comments on the necessity for revolutions to clean things up - ever so often.
Methinks the “so often” may be near.
Tax and spend is what dems do. The really interesting part is what will the new Congress do esp if ‘conservatives’ take charge. If there’s no repeal they own the increases whether they like it or not. Not only will they have to repeal them but also override Barry’s veto. That exercise will demonstrate their resolve to put the country back on track. Then there are the necessarily huge spending cuts. All in all its a pretty big chuck to take on. I suspect they’ll fail due to lack of courage...that’s what republicans do.
the liberals are misty-eyed over returning to Bill Clinton’s tax rates....but minus the Gingrich “Contract with America”
Raise taxes in the midst of a looming DEPRESSION without any fiscal restraint whatsoever on the president or the democrat/RINO congress - except China
Can’t wait, kids.
And don’t spend your spare change anytime soon
If the Republicans don’t undo some of this Admin’s policies, then they’ll be made to pay too. They had better sit up, take notice, and listen...for a change.
_________________
Even if the Republicans take one — or both — houses of Congress, unless they have VETO PROOF Majorities, which ain’t likely, there will be no way for them to change the tax increases. They can vote them out of Congress, but Obama will just veto them. When they go into effect, and crash the economy, Obama will actually have the AUDACITY to blame THE REPUBLICANS for CAUSING the problems because they “wasted time” trying to “undo my reforms” instead of “moving forward” and “advancing our agenda.” And the sychophantic mainstream media WILL trumpet his message for him — and Obama WILL be reelected in 2012....
Of course, this is a WORST case scenario....
This may become the Smoot-Hawley fiasco of the 21st century.
The Republicans got sucker punched by the Democrats again, because collectively they thought there was no way the Democrats would allow obviously unfair tax penalties to be re-instated. And just as the Democrats do not care if legislation is good or bad as long as it enhances their big government agenda, they do not care about fairness in the tax code.
its our DUTY and our MORAL OBLIGATION to avoid paying the govt anymore taxes than is absolutely necessary......I just wish I was rich enough to know how....
Republicans blamed.
And RINO’s like John McCain will continue to refer to the Rats as “my friends”.
Could be, but IMHO, it’s highly unlikely. The liberal progressive fascists are running the show and, like a back-alley crack addict, are addicted to tax increases.
I’ve been adjusting the number of dependents to get my tax refund as close to zero as possible. 2011 will be difficult to figure out. I don’t mind having to pay a few hundred dollars or so if I don’t have enough tax withheld, but I can’t afford to get into the thousands of dollars range.
The United States was founded by revolution; it is tradition.
Hauser’s Law: No Fed tax collection efforts as measured in total from the early 1900’s have EVER been able to exceed 19.5% of the GDP. Therefore, measure the ability of the US taxpayer to service the national debts as never exceeding 19.5% of the nations current GDP, no matter what.
http://shimmie.shishnet.org/v2/post/view/2413 1950-2007
Graph from 1910 remains the same, at 19.5%, not linked.
Taxes will decrease the GDP further, and China has itself downgraded the US Bond rating it uses.
Recent articles also show that for every dollar borrowed there is a consequential DECREASE in GDP of $.40-$.45 with associated job REDUCTIONS! The Diminishing Productivity of Debt graph now in BIG negative terrirory!:
http://www.swarmusa.com/vb4/content.php/282-THE-Most-Important-Chart-of-the-CENTURY
Recovery? In the administrations dreams! WE have not hit bottom yet.
Thanks for at least adding that this is the worst case scenario. That makes me feel a tiny bit better.
However, it all sounds so hopeless to me. I feel as if something drastic doesn’t happen that could remove this idiot from office, then we’re doomed.
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