5 impact tax increases good for the economy budget

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Unformatted text preview: tax rates. The way to expand revenues is to expand the tax base, not rates. It's been said that if you control the language, you control the debate. The debate has been whether the Bush tax cuts should be extended for the "wealthy" or just the middle class or a combination of the two. The debate shouldn't be about "cuts" at all, but about maintaining current tax rates that have been in existence for nearly a decade. And it shouldn't be about the "wealthy," but about the successful, the risk takers, entrepreneurs and small businessmen who create the jobs th e middle class, suffering from long-term near double-digit unemployment, sorely need. As taxes rise, people and businesses tend to engage in behavior that will reduce their tax burden. A rising tax burden and the added costs of hiring additional employees leads businesses not to expand or to think twice about adding extra workers. Investors put their money elsewhere. [____] Tax increase will crush investor confidence in the economy Fred Thompson, former US Senator, 2010 (August 23, On Dec. 31, 2010, almost every working American will be hit with a massive, across-the-board tax increase on their income and investments. On this date, the Bush tax cuts, enacted in 2001 and 2003, comple tely expire. We must urge Congress and the president to renew the Bush tax cuts early, before they expire and before investors lose confidence in the U.S. economy. The automatic tax increase will begin on Jan. 1, 2011, and could have catastrophic consequen ces for the economy. 14 | P a g e Taxes Bad DA BDL Tax Increases Collapse Investor Confidence [____] [____] And investor confidence is critical to the economy National Commission on Fiscal Responsibility ’10 (4/27/10, “National Commission on Fiscal Responsibility Holds Its Inaugural Meeting,”, lexisnexis) Moreover, other things being equal, increased federal debt implies higher taxes in the future to cover the associated interest costs -- higher taxes that may create disincentives to work, save, hire and invest. High levels of debt also decrease the ability of policy-makers to respond to future economic and financial shocks. And, indeed, a loss of investor confidence in the ability of the government to achieve fiscal sustainability can itself be a source of significant economi c and financial instability, as we have seen in a number of countries in recent decades. 15 | P a g e Taxes Bad DA BDL Answers To: No Impact On Small Business [____] [____] Higher tax rates have a big impact on small businesses JD Foster, Heritage Foundation, 2010 (States News Service, August 26, p. online) MYTH: Small businesses would be only marginally affected by higher taxes rates. FACT: Successful, growing, hiring small businesses are especially targeted by higher tax rates. Another popular myth offered to sustain the Obama tax hikes is that higher tax rates would fall on too few small businesses to matter. While less than 2...
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This document was uploaded on 02/06/2014.

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