COMING TAX HIKE
July 30, 2007
Republican tax relief packages in 2001 and 2003 resulted in a booming economy, proving that when government gets out of the way, the American people will get to work, says Senator Jon Kyl (R-Ariz.).
- The 2001 and 2003 tax reductions have spurred more than five years of uninterrupted growth; the economy grew at a robust 3.4 percent in the second quarter of 2007.
- Productivity growth has averaged 2.8 percent since 2001, considerably above the average of each of the past three decades.
- Since August 2003, our economy has created more than 8.2 million jobs and the current unemployment rate is just 4.5 percent, lower than the averages of the 1960s-1990s.
- Wages have been on the rise, and real after-tax income is up 9.9 percent since 2000, an average of nearly $3,000 per person.
Further, tax relief has helped produce an economy that has generated higher than expected tax revenues for the federal government, says Kyl:
- Tax receipts have risen 37 percent over the last three years and are projected to increase another 7 percent this year.
- These rising tax receipts have helped drive down the deficit, which is projected to drop significantly in 2007 for the third year in a row.
- The deficit this year is expected to measure just 1.5 percent of GDP, considerably below the average of the last 40 years.
Unfortunately, says Kyl, Democrats have approved a budget that fails to extend the bulk of the 2001 and 2003 tax relief. In addition, some are also proposing another tax hike on higher income Americans and small business owners to pay for alternative minimum tax relief.
Raising taxes -- by allowing tax relief to expire or by passing burdensome new tax hikes -- would threaten the progress our economy has made and discourage future growth, says Kyl.
Source: Jon Kyl, "Coming Hike," National Review, July 30, 2007.
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