Monday, May 21, 2012

Economy - Taxes - #3905 - Five Reasons Congress Should Act Now to Stop Taxmageddon - Hot Air (2) Michael Barone: Obama Pursues Higher Tax Rates - What is Really Happening in Europe - Townhall (3) Stopping Largest Tax Hike in History - Heritage Foundation

Americans are facing an unprecedented $494 billion tax hike on Jan. 1, 2013. It’s been dubbed “Taxmageddon” given the economic devastation it would cause. Conventional wisdom suggests lawmakers in Washington will wait until the 11th hour to come up with a solution. Fortunately, Speaker John Boehner (R-OH) announced this week he won’t wait for a lame-duck session of Congress. From his speech to the Peter G. Peterson Foundation’s 2012 Fiscal Summit: Tax hikes destroy jobs – especially an increase on the magnitude set for January 1st. Small businesses need to plan. We shouldn’t wait until New Year’s Eve to give American job creators the confidence that they aren’t going to get hit with a tax hike on New Year’s Day. Any sudden tax hike would hurt our economy, so this fall – before the election – the House of Representatives will vote to stop the largest tax increase in American history. The bulk of Taxmageddon comes from expiration of the 2001 and 2003 Bush tax cuts, but also means the child tax credit will be cut in half, the Alternative Minimum Tax patches end, the Death Tax returns to its 2001 level, and a handful of new Obamacare tax hikes take effect.  Read more........

Michael Barone: Obama Pursues Higher Tax Rates - What is Really Happening in Europe - Townhall - In the run-up to this weekend's G-8 summit at Camp David, journalists have unfavorably compared European "austerity" with Barack Obama's economic policies. European spending cuts, the argument goes, have hurt people and are arousing political opposition, while Obama's proposals to keep federal spending at 24 percent of gross domestic product indefinitely are likely to succeed. Evil Republican spending cuts, in contrast, would deny the economy needed stimulus and wreak havoc on ordinary people. But the facts undermine the storyline. Veronique de Rugy of the Mercatus Center at George Mason University took a look at what "austerity" in Europe actually means. What she found is that government spending has increased or not appreciably declined in Britain, France, Italy, Spain and Germany. The only significant spending reductions are in Greece, where the bond market cut off funding. In the other countries, the big adjustment has been an increase in tax rates. European "austerity" is an attempt to reduce government budget deficits largely by increasing taxes and only to a small extent by reining in spending.  Read more.........

Stopping Largest Tax Hike in History - Heritage Foundation - The largest tax hike in history is due to strike the United States on January 1, 2013. Known as “Taxmageddon,” it would impose $494 billion in higher taxes on the American people in the first year. So terrible would be its impact that yesterday Fed Chairman Ben Bernanke warned Senate Democrats that the country is headed toward a “fiscal cliff” and that Congress must deal with the impending tax nightmare. On Wednesday, House Speaker John Boehner (R-OH) announced that his chamber will take up the issue before the November election. Knowing Washington’s general reluctance to do anything of substance in an election year, Boehner’s announcement was welcome news given the disastrous ramifications the threat of such a massive tax hike is already having on the economy. That’s according to Mohammed El-Erian, CEO of Pimco, the world’s largest bond trading firm. El-Erian argues a “prolonged political inaction is likely to postpone building plants and purchasing equipment and to discourage them from hiring.” And that is only an inkling of the blow that would strike the economy if these tax hikes actually took effect.  Read more........

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