Obama's Jobs Plan: Permanent Tax Hikes on Job Creators
September 22, 2011
President Obama has revealed that the increased spending and temporary tax cuts that his American Jobs Act entails will be offset solely with tax hikes, and not one penny of spending reductions. In the end, the tax hikes would be permanent while the jobs policies temporary; thus, the proposal is really a tax hike plan rather than a jobs plan, says Curtis Dubay, a senior tax policy analyst at the Heritage Foundation.
- Almost all of the $447 billion in increased revenue called for by President Obama would come from raising taxes on job creators -- the same job creators President Obama wants to hire more workers to reduce the unemployment rate.
- The plan would raise taxes on job creators by capping the deductions that families and businesses earning more than $250,000 a year could claim.
- It would reduce the deductions of these families and businesses to the amount they could claim had they only earned enough to qualify for the 28 percent tax bracket instead of the higher tax brackets (33 percent and 35 percent) they face now.
- This tax hike would be on top of the 3.8 percent surtax on investment income that these same families and businesses will pay beginning in 2013 and the higher marginal income tax rates they will pay if the Bush tax cuts expire at the end of 2012.
Unfortunately, President Obama will not consider policies that would actually create jobs by reducing the high level of uncertainty that persists in the economy today. This would include doing things such as:
- Fundamental revenue-neutral tax reform that repairs the tax base and lowers marginal tax rates to improve the incentives for income production.
- Reducing the crushing amount of regulations coming from various federal government agencies.
- Repealing health reform and its onerous regulations and taxes.
- Repealing the Dodd-Frank financial reform legislation.
- Stopping incessant calls for higher taxes.
Source: Curtis Dubay, "Obama's Jobs Plan: Permanent Tax Hikes on Job Creators," Heritage Foundation, September 15, 2011.
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