In his budget message to Congress in January 1963, President Kennedy wrote, “Lower rates of taxation will stimulate economic activity and so raise the levels of personal and corporate income as to yield within a few years an increased — not a reduced — flow of revenues to the federal government.”
Unfortunately new leadership in the U.S. House of Representatives has chosen to ignore Kennedy’s exemplary fiscal insight of years ago.
Democrats in Congress are discounting advancements made possible by the 2001 and 2003 tax cuts passed by Congress and are trying to slap U.S. taxpayers with a $400 billion tax increase that will slow our economy’s current progress.
If Democrats follow through on their budget promises, the American people will face the following:
A $500 per child tax increase.
A 55 percent Death Tax.
A 13 percent tax increase for many small businesses.
A 33 percent tax increase on capital gains.
A 164 percent tax increase on dividends.
I believe Republicans and Blue Dog Democrats in Congress must join together to ensure the American economy is not crippled by a massive tax increase. I recently introduced the Tax Increase Prevention Act, legislation that would make permanent tax relief passed in 2001 and 2003.
My bill simply takes away all the sunset provisions of the 2001 and 2003 tax relief packages that passed Congress and provides American families and job-creators the certainty to plan for the future.
If my bill becomes law, the American people will see none of the tax increases Democrats are proposing on things like marriage, childbirth, adoption, earning money, saving money, paying college loans and dying.
A recent Heritage Foundation study revealed the Democratic plan would raise taxes by $3,019 for each person in my south-central Michigan district. Also, the Heritage study revealed this tax increase would cause 2,272 job losses in south-central Michigan and cost my district’s economy $207 million.
These numbers are not exclusive to my district, as 100 percent of Americans will feel the effects of this massive tax increase.
The critics say making tax relief permanent will eliminate large amounts of federal revenue, but tax revenue correlates with economic growth, not tax rates.
There is no reason not to make this tax relief permanent. The tax cuts of 2001 and 2003 are working, as evidenced by recent news that more than 40 states report higher tax revenue than expected this year.
I cannot even begin to imagine how bad the current fiscal crisis in my home state of Michigan would be had we not benefited from tax cuts in 2001 and 2003. These very successful cuts have provided workers, entrepreneurs and investors needed relief to get the U.S. economy moving again. Congress needs to leave more resources with the hard-working people and small businesses that make our communities strong by accepting no more tax increases.
Tim Walberg is a Republican member of the U.S. House of Representatives from Michigan.