The largest tax hike in the history of the United States, in fact. There are many congruent factors.
- The 2001 and 2003 tax reliefs expire Jan. 1.
- Personal income tax rates increase across the board, Jan. 1.
- Marriage penalty rises and child tax credit drops Jan. 1.
- Middle class death tax returns Jan. 1.
- Higher tax rates on savers and investors Jan. 1.
- Some of the Obamacare taxes begin Jan. 1.
- The Alternative Minimum Tax will impact more middle class Jan. 1.
- Business tax rates increase across the board.
- Charitable contributions may not be deducted from IRA taxes Jan. 1.
- Tax benefits for education reduced.
I, like many of you, don't know how I will afford to pay taxes this year if Romney is not elected and pushes some sensible tax legistation through the legislature, especially with Bernanke playing for Obama and raising our cost of living by printing more money. Also, in case you missed it, Obamacare is set to raise taxes on 6 million uninsured Americans, and most are in the middle class.
Here are the details for personal income tax rates:
The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which the majority of small business profits are taxed). The lowest rate will rise from 10 to 15 percent. All the rates in between will also rise. Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates. The full list of marginal rate hikes is below:Some people think that higher taxes will solve the revenue problem for the federal government but this is backwards. Obama has spent $1T over budget every single year, and revenue has been below budget every single year. This means that government needs to cut spending and reform entitlement programs so they'll last, not raise taxes. Raising taxes puts more people out of work, generates less revenue for the government. There isn't enough money in the entire country to tax to make a dent in our deficit, even taxing at 100% which would shut down all business and income forever!
-The 10% bracket rises to a new and expanded 15%
-The 25% bracket rises to 28%
-The 28% bracket rises to 31%
-The 33% bracket rises to 36%
-The 35% bracket rises to 39.6%
For government revenue to increase, first we need to get the economy growing, and for that we need low taxes. Lower taxes mean more revenue, not that you'll find the liberal media admitting that this works every single time it's tried. Businesses thrive with low taxes (and regulations), then they hire more people who pay more taxes, and the businesses themselves make more profits and pay more taxes. Plus, people stimulate the economy only when they have money to spend so high taxes combined with rising costs of living has gotta stop for a healthy and growing economy.
In this critical time (see yesterday's post), I trust Romney to actually cut spending as he promised, to cut taxes as he promised, to grow the economy as he promised, and to lower unemployment as he promised. He knows how. He has a record of growth and budget cuts. We've seen a lot of empty, broken promises from Obama thus far and no sign that he is going to change course and do what works. Putting the same failed methods towards the same problems isn't a real solution. It may fool voters, but the end result is a welfare state moving towards socialism and away from freedom and prosperity (again, see yesterday's post).