Tuesday, April 17, 2012

The Big Fail: Obama: The Tax King Cometh

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RNC Research - The Big Fail
If Obama Had His Way, Next Year's Tax Day Would Be Devastating For American Families
Obama's FY2013 Budget Calls For $1.9 Trillion In Higher Taxes. ("Fiscal Year 2013 Budget Of The U.S. Government," OMB, 2/13/12)
  • Obama's Budget Would Result In "Monumental" Tax Increases. "The only thing that you can be certain will become law in this budget if Mr. Obama is re-elected is the monumental tax increase. His plan would raise tax rates across the board on anyone or any business owners making more than $200,000 for individuals and $250,000 for couples. These are the 3% of taxpayers that Mr. Obama says aren't paying their fair share, though that 3% pays more in income tax than the rest of the other 97%." (Editorial, "The Amazing Obama Budget," The Wall Street Journal, 2/14/12)
Obama Admitted He Wants To Raise Taxes In 2013 If He Is Reelected. OBAMA: "That is a reasonable proposition. So, when you hear folks saying 'Well, the president shouldn't want massive job killing tax increases when the economy is this weak.' Nobody's looking to raise taxes right now. We're talking about potentially 2013 and the out-years." (President Barack Obama, Press Conference, Washington, DC, 7/11/11)
America Is Heading Toward A "Massive Fiscal Cliff" In 2013
Fed Chair Ben Bernanke Says The Economy Is Headed For A "Massive Fiscal Cliff" If The 2001 And 2003 Tax Cuts And Payroll Tax Cut Expire. "Congress risks taking the economy over a 'massive fiscal cliff,' Federal Reserve Chairman Ben Bernanke warned lawmakers on Wednesday. In remarks that hit Wall Street stock prices, the central bank boss suggested the economy could hit a serious roadblock if Congress allows the Bush tax rates and a payroll tax cut to expire and $1.2 trillion in spending cuts to be implemented simultaneously in January." (Peter Schroeder, "Bernanke Warns Lawmakers Country Headed For 'Massive Fiscal Cliff,'" The Hill's "On The Money," 2/29/12)
"The Bush Tax Cuts Will Expire. The Temporary Payroll Tax Cut Will End. Unemployment Benefits Will Be Severely Curtailed. And All On Jan. 1, 2013. Happy New Year!" "The result of all this can kicking is that Congress must make all those decisions by January 2013-or defer them yet again. If the House and Senate don't act in time, a list of things will happen that are anathema either to Republicans or Democrats or both. The Bush tax cuts will expire. The temporary payroll tax cut will end. Unemployment benefits will be severely curtailed. And all on Jan. 1, 2013. Happy New Year!" (Alan Blinder, Op-Ed, "The U.S. Cruises Toward A 2013 Fiscal Cliff," The Wall Street Journal, 3/30/12)
  • "The Potential Shock To The Nation's Pocketbook Is So Enormous, Congressional Aides Have Dubbed It 'Taxmageddon'" And Some Economists Believe It Could Lead To Another Recession. "The potential shock to the nation's pocketbook is so enormous, congressional aides have dubbed it 'Taxmageddon.' Some economists say it could push the fragile U.S. economy back into recession, particularly if automatic cuts to federal agencies, also set for January, are permitted to take effect." (Lori Montgomery, "'Taxmageddon' Looms At End Of Payroll Tax Holiday," The Washington Post , 2/18/12)
Obama Is "Setting Up The U.S. Economy For One Of The Biggest Tax Increases In History In 2013." "President Obama unveiled part two of his American Jobs Act on Monday, and it turns out to be another permanent increase in taxes to pay for more spending and another temporary tax cut. No surprise there. What might surprise Americans, however, is how the President is setting up the U.S. economy for one of the biggest tax increases in history in 2013." (Editorial, "The 2013 Tax Cliff," The Wall Street Journal, 9/14/11)
  • "The Tax List Includes Limiting Deductions For Those Earning More Than $200,000 ($250,000 For Couples), Limiting Tax Breaks For Oil And Gas Companies, And A Tax Increase On Carried Interest Earned By Private Equity Firms." (Editorial, "The 2013 Tax Cliff," The Wall Street Journal , 9/14/11)
  • Small Businesses Will "Get Hit With A Giant Tax Bill." "These tax increases would not be temporary. What this means is that millions of small-business owners had better enjoy the next 16 months, because come January 2013 they are going to get hit with a giant tax bill." (Editorial, "The 2013 Tax Cliff," The Wall Street Journal , 9/14/11)
PROMISE: In 2008, Obama Promised He Would Not Raise Any Taxes On Families Earning Less Than $250,000 A Year. "I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes."(Senator Barack Obama, Remarks In Dover, NH, 8/12/08)
BROKEN: PolitiFact Rates Obama's Tax Pledge As "Promise Broken." "We were willing to give President Barack Obama a Compromise rating on this promise when a new cigarette tax went into effect. But the latest health care bill includes more broad-based taxes that are pushing us toward Promise Broken." (Angie Drobnic Holan, "Smokers, Tanning Aficionados, The Happily Uninsured: More Taxes Coming At Ya!," PolitiFact, 4/8/10)
NOW: Obama Has Said He Is "Agnostic" On Raising Taxes On Those Making Less Than $250,000 As Part Of A Plan To Reduce The Deficit. "President Barack Obama said he is 'agnostic' about raising taxes on households making less than $250,000 as part of a broad effort to rein in the budget deficit. Obama, in a Feb. 9 Oval Office interview, said that a presidential commission on the budget needs to consider all options for reducing the deficit, including tax increases and cuts in spending on entitlement programs such as Social Security and Medicare." (Rich Miller, "Obama 'Agnostic' On Deficit Cuts, Won't Prejudge Tax Increases,"Bloomberg, 2/11/10)
  • Obama Was "Intrigued By [The] Elegance" Of Allowing All Of The Bush Tax Cuts To Expire In Order To Cut The Deficit. "In November 2009, Orszag would tout an idea that divided the economic team and inspired contempt in the political shop: extending for one or two years George W. Bush's middle class cuts, which were scheduled to expire in 2011, then letting them lapse unless Congress found a way to offset their costs. During a meeting with Obama in the Oval Office, he casually outlined the proposal. The obvious defect was that it would be likely to break the president's campaign pledge to oppose tax increases on the middle class. Nevertheless, Obama was intrigued by its elegance as a deficit-cutting maneuver, according to two people in the room. He also liked the idea of forcing Republicans to grapple with the costs of Bush's policies. Only later did the politicos revolt-the vice president, for one, was apoplectic-and the president lost interest." (Noam Scheiber, The Escape Artists, 2012, p. 154-155)
  • "Obama Would Block Extension Of The Reductions, Either As A Final Act In Office After Losing The November 2012 Election Or After Winning A Second Term." "A White House official argued Sunday that the president had another trump card to play: the scheduled expiration of the George W. Bush tax cuts at the end of 2012. Obama would block extension of the reductions, either as a final act in office after losing the November 2012 election or after winning a second term." (Peter Wallsten and David Nakamura, "Did Obama Capitulate - Or Is This A Cagey Move?" The Washington Post , 7/31/11)
Obama's FY2013 Budget Would Raise Taxes On 27 Percent Of U.S. Households According To A Study By The Tax Policy Center. "President Barack Obama's 2013 budget plan would raise taxes for 27 percent of U.S. households in 2013, far more than the administration estimates, according to a nonpartisan study. The study released today comes from the Tax Policy Center, a research group in Washington that analyzes proposals from presidential candidates in both parties. Obama focuses the tax increases in his 2013 budget on corporations and the top 2 percent of individual taxpayers. The result in the center's study stems from the fact that taxpayers in all income brackets own parts of corporations." (Richard Rubin, "Obama Budget Raises Taxes For 27% Of Households, Report Says," Bloomberg, 3/21/12)
  • 23.6 Percent Of Households Making Between $40,000 And $50,000 Would Have Their Taxes Increased. ("Table T12-0044, Administration's FY2013 Budget Proposals," Tax Policy Center, 3/15/12)
  • 31.6 Percent Of Households Making Between $50,000 And $75,000 Would Have Their Taxes Increased. ("Table T12-0044, Administration's FY2013 Budget Proposals," Tax Policy Center, 3/15/12)
  • 38.7 Percent Of Households Making Between $75,000 And $100,000 Would Have Their Taxes Increased. ("Table T12-0044, Administration's FY2013 Budget Proposals," Tax Policy Center, 3/15/12)
Democrats Have Backed Away From Obama's Definition Of The Middle Class
Sen. Schumer (D-NY) Does Not Support Obama's Tax On Incomes Over $250,000 Because That Is "Firmly In The Middle Class" And "Not Rich." "But the president also wanted to raise taxes on families making more than $250,000 a year by limiting income-tax deductions they can take. That didn't sit well with rank-and-file Democrats. Schumer said families that earn $250,000 or $300,000 a year aren't rich enough to deserve extra taxes. He described them as 'firmly in the middle class. They are not rich, and in large parts of the country, that kind of income does not get you a big home or lots of vacations or anything else that's associated with wealth in America,' he said." (S.A. Miller, "Million-Dollar Idea," New York Post, 10/6/11)
  • Sen. Schumer Said That Raising Taxes On Families Over $250,000 "Fuzzies The Picture." "Democrats have long argued that, in addition to cutting government spending, lawmakers should ask people at the top of the income spectrum to pay more in taxes to help tame the national debt. But setting the dividing line at $250,000, as Obama did during the 2008 campaign, 'fuzzies the picture,' said Sen. Charles E. Schumer (D-N.Y.), the leading architect of the surtax proposal." (Lori Montgomery, "Democrats Shift The Definition Of 'Rich' In Battle Over Taxes," The Washington Post , 10/5/12)
  • Senate Democrats Rejected Obama's Tax On Incomes Over $250,000. "And on Wednesday came clear evidence of this shift: Senate Democratic leaders scrapped Obama's proposal to cover the cost of his jobs bill by raising taxes on income over $250,000 a year, the old Democratic standard for defining the wealthy. Instead, they are proposing a 5.6 percent surtax on annual income of more than $1 million." (Lori Montgomery, "Democrats Shift The Definition Of 'Rich' In Battle Over Taxes," The Washington Post , 10/5/11)
  • Democrats Have Become "Increasingly Divided On The Issue." "But they've taken a beating from Republicans and have grown increasingly divided on the issue, since that income level would not only cause tax increases for some small businesses but also hit upper-middle-class suburban voters in swing states." (Manu Raju, "Democrats: $250K Isn't Rich," Politico, 10/5/11)
America Has The Highest Corporate Tax Rate In The World. "April 1 is a date that every politician and business executive in America should circle on the calendar. That's when Japan cuts its corporate tax rate to 36.8% from 39.5%. The United States will then hold the title of highest corporate tax rate, with average combined federal and state profit levies of 39.2%. Yes, that's higher than Sweden. Higher than Russia. And China, Mexico, Denmark and even France. Doesn't it make you want to break out in a chant: U-S-A, U-S-A?" (Editorial, "The U.S. Is Number One," The Wall Street Journal, 3/15/12)
Obama's Corporate Tax Framework Would Complicate The Tax Code And Extend Manufacturing Credits Far Beyond The Factory Floor. "A Reuters analysis of company filings and government data shows how broadly the deduction is now used, suggesting it may be nearly impossible to keep it focused on manufacturing. Corporate America's army of tax lawyers will be at the ready. From Starbucks Corp to Time Warner Cable Inc, businesses far beyond traditional manufacturers use the benefit, Reuters found." (Kim Dixon, "Analysis: Tax Break Goes Far Beyond The Factory Floor," Reuters, 3/8/12)
  • Obama's Corporate Tax Plan Won't Help Small Businesses And Will "Leave Many Business Owners With Higher Tax Bills." "Last week, President Barack Obama released a proposal to lower the federal corporate tax rate - a move that on its face would seem to be good news for small businesses. But the president's pitch isn't getting rave reviews. Advocates for small business say the plan would benefit a relatively low number of small companies and leave many business owners with higher tax bills." ("Small Business Community Says Obama Corporate Tax Plan Will Only Benefit A Few," The Associated Press , 3/1/12)
Obama's Corporate Tax Plan "Would Make The U.S. Tax System Less Globally Competitive And Raise Effective Tax Rates Above What They Are Today." "Yesterday's release of the White House 'Business Tax Reform' marks a watershed in the corporate tax debate. Now nearly everyone acknowledges that U.S. corporate tax rates hurt American companies. The headline that President Obama wants voters to see is his new top statutory rate of 28%. If only the story ended there. Alas, his reform is stuffed with so many offsetting business tax increases that the overall impact of this and other proposals would make the U.S. tax system less globally competitive and raise effective tax rates above what they are today." (Editorial, "Obama's Tax Reform Muddle," The Wall Street Journal, 2/23/12)
  • "The Problem Is That The Tax Increases In This And Other Obama Proposals Would Add New Layers Of Inequity And Inefficiency To The Tax Code." "The problem is that the tax increases in this and other Obama proposals would add new layers of inequity and inefficiency to the tax code. One principle of tax reform is to create neutrality within and across industries-a level playing field. As the White House proposal puts it, the current code 'distorts choices such as where to produce, what to invest in, how to finance a business, and what business form to use.'" (Editorial, "Obama's Tax Reform Muddle," The Wall Street Journal, 2/23/12)
Biden Says Obama Wants To Create A "Global Minimum Tax." BIDEN: "We want to drop the rate particularly for high tech manufacturers, like you, Mr. President, even further than the twenty percent. We want to create what's called a global minimum tax, because American taxpayers shouldn't be providing a larger subsidy for investing abroad than investing at home." (Vice President Joe Biden, Remarks, Davenport, IA, 3/28/12)
The Obama Administration Will Propose A Global Minimum Tax But They Won't Say How High It Will Be. "But then, in the third section, the White House will follow up on an innovative idea they included in the State of the Union and propose a global minimum tax. They'll say more about how such a tax will work, but they won't say how high such a tax should be. That's left up to Congress." (Ezra Klein, "Wonkbook: Tax Reform Is Really, Really Hard," The Washington Post , 2/22/12)
  • The Global Minimum Tax Means That "Instead Of A Carrot, Corporate America Gets The Stick." "So instead of a carrot, Corporate America gets the stick. Instead of lowering the U.S. rate to a competitive level, Obama would raise the penalty on keeping profits overseas. Indeed, the United States is a huge outlier in that it taxes the foreign profits of multinational companies." (Jim Pethokoukis, "Why Obama's Corporate Tax Plan Is A Total Bust," The American, 2/22/12)
The Global Minimum Tax Would Give Foreign Companies Doing Business In The U.S. A Tax Cut While U.S. Businesses Abroad Would Get A Tax Hike. "Thus the plan would increase taxes on U.S. multinational companies as a means of paying for the lower corporate tax rate which will largely benefit domestic companies. On that note, it seems very unfair that foreign companies doing business in this country would get a 20 percent tax cut but U.S. companies doing business abroad would get a tax increase. How does that help U.S. competitiveness?" (Scott A. Hodge, "Thoughts On President Obama's Corporate Tax Plan," Tax Foundation, 2/23/12)
  • "The Administration's Proposed Global 'Minimum Tax' Is A Bit Like Neiman Marcus Declaring Itself The Last Stop Against The Growth Of Discount Retailers Such As Target, Walmart And, Now J.C. Penny." (Scott A. Hodge, "Thoughts On President Obama's Corporate Tax Plan," Tax Foundation, 2/23/12)


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April 17, 2012

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