Obama tax plan creates massive job losses, Hundreds of thousands of jobs disappearing, Ernst & Young report, CBO, House Ways & Means Committee Chairman Dave Camp
“…and Socialist governments traditionally do make a financial mess. They [socialists] always run out of other people’s money. It’s quite a characteristic of them.”…Margaret Thatcher
“I absolutely reject that notion [mandate is a tax].”…Barack Obama
“Recently, Obama has been re-elected for a 2nd term by an illiterate society and he is ready to continue his lies of less taxes while he raises them.”…Pravda November 19, 2012
From the Examiner December 2, 2012.
“Fiscal cliff: Obama tax and spend plan unbalanced, says top lawmaker”
“While President Barack Obama complained about Republicans during his Pennsylvania visit on Friday and made another political campaign-style pitch to raise taxes by $1.6 trillion, he failed to put forward a “balanced” plan that includes significant spending reductions to deal with the so-called fiscal cliff, according to a top member of the House Ways & Means Committee on Saturday.
The President’s continued focus on increasing tax rates is fast turning the fiscal cliff into a jobs cliff. In fact, manufacturers across the country are warning Americans that the President’s tax increases will cost American jobs. And these employers aren’t alone.
According to the non-partisan Joint Committee on Taxation, nearly one million small businesses and more than half of all small business income earned will be impacted by the President’s tax rate hikes.
Knowing that higher tax rates mean less money for investment and hiring, it is no wonder that both the accounting firm of Ernst & Young and the non-partisan Congressional Budget Office confirm that raising any tax rate will result in hundreds of thousands of jobs disappearing.
The Ernst & Young report is more proof that the President doesn’t understand the economy or what it takes to create jobs in this country. After more than three years of high unemployment, slow growth and record levels of stimulus spending, the Obama Administration appears ready and willing to further derail the U.S. economic recovery by raising taxes on small businesses, according to House Ways & Means Committee Chairman Dave Camp (R-MI).
“We need these employers and investors creating more paychecks, not paying more taxes. Rather than double down on tax hikes that will make it harder to get America back to work, it is time to stop the tax hike – for all taxpayers – and move forward with comprehensive tax reform that will provide the certainty these entrepreneurs need,” Camp said.
Throughout his tenure in the House, according to Camp staff member Michelle Dimarob, he has worked with lawmakers from both sides of the aisle to advocate for lower tax rates for American families and employers, a long term overhaul and simplification of the U.S. tax code, and trade policies that expand American exports while ensuring American workers are protected.
Camp authored the House GOP alternative to the Democrats’ health care law, the only health care legislation scored by the Congressional Budget Office to lower the cost of health insurance premiums for Americans, according to staffer Sarah Swinehart.”
From the Ernst & Young report.
“Long-run macroeconomic impact of increasing tax rates on high-income taxpayers in 2013″
“This report uses the EY General Equilibrium Model of the US Economy to examine the impact of the increase in the top tax rates in the long-run. While a recent Congressional Budget Office (CBO) report examined the near-term effects of all of the federal government fiscal policies under scrutiny at the end of 2012 and found them to be of sufficient size to push the economy into recession at the beginning of 2013, this report focuses on the long-run effects of the increase in the top tax rates. This report examines four sets of provisions that will increase the top tax rates:
The increase in the top two tax rates from 33% to 36% and 35% to 39.6%.
The reinstatement of the limitation on itemized deductions for high-income taxpayers (the “Pease” provision).
The taxation of dividends as ordinary income and at a top income tax rate of 39.6% and increase in the top tax rate applied to capital gains to 20%.
The increase in the 2.9% Medicare tax to 3.8% for high-income taxpayers and the application of the new 3.8 percent tax on investment income including flow-through business income, interest, dividends and capital gains.
With the combination of these tax changes at the beginning of 2013 the top tax rate on ordinary income will rise from 35% in 2012 to 40.9%, the top tax rate on dividends will rise from 15% to 44.7% and the top tax rate on capital gains will rise from 15% to 24.7%.
These higher tax rates result in a significant increase in the average marginal tax rates (AMTR) on business, wage, and investment income, as well as the marginal effective tax rate (METR) on new business investment. This report finds that the AMTR increases significantly for wages (5.0%), flow-through business income (6.4%), interest (16.5%), dividends (157.1%) and capital gains (39.3%). The METR on new business investment increases by 15.8% for the corporate sector and 15.6% for flow-through businesses.
This report finds that these higher marginal tax rates result in a smaller economy, fewer jobs, less investment, and lower wages. Specifically, this report finds that the higher tax rates will have significant adverse economic effects in the long-run: lowering output, employment, investment, the capital stock, and real after-tax wages when the resulting revenue is used to finance additional government spending.”