August 1, 2012

Stop the Tax Hike

Top Line Messaging Themes

 

August 1, 2012

 

• The president’s policies have failed and are making the economy worse.  Since the president took office, America has witnessed the longest period of sustained high unemployment since the Great Depression -- more than 8 percent every month he’s been in office. 

 

• The president’s failed policies have led to an economy where nearly half of all Americans are now classified as poor or low-income, and more Americans than ever are on food stamps. 

 

• Because the president clearly cannot stand on his record, he has regrettably turned to the politics of envy and division.

• Raising taxes will not solve our nation’s debt crisis and will seriously harm small businesses. Fairness is not found in taxing some people more; it is found in subsidizing everyone less. 

 

• House Republicans passed a budget that would scrap the tax loopholes, end the special interest taxpayer subsidies President Obama defends – like those the president gave to Solyndra – and put an end to government bailouts.

 

• House Republicans have a Plan for America’s Job Creators – it’s time for the President and Democrats in the Senate to stop blocking our jobs bills. 

 

• Last week, Senate Democrats passed the president’s plan to raise taxes on our nation’s small businesses and job creators.  House Republicans have the only plan in Washington to stop the tax hike in its entirety.

 

• If we fail to act, a family of four earning $50,000 a year will see their taxes increase nearly $2,200 per year and the total tax hike would be more than $4 trillion over the next decade. That is why House Republicans will vote to stop the tax hike this week. 

 

• A new report released by the accounting firm Ernst & Young finds the President’s tax increases will hurt the economy and cost more than 710,000 American jobs. In addition, the report found that wages would fall by 1.8 percent, reflecting a decline in workers’ living standards relative to what would have occurred otherwise.
• In addition to stopping the tax hike, the Republican plan will boost economic growth and create jobs by enacting comprehensive tax reform next year that makes the code simpler and fairer for families and employees and closes special-interest loopholes.

 

(Courtesy of the Ways and Means Committee)

 

The Choice: Destroy Jobs or Create Jobs?

GOP Plan: (1) Stop the Job-Killing Tax Hike, and

(2) Create More Jobs Through a Simpler, Fairer Tax Code

 

The Choice

 

This week, America will see clearly the two different visions Republicans and Democrats are putting forward.  The House Republican plan (1) stops the tax hike looming at the end of the year and (2) puts in place expedited procedures to ensure Congress does its job next year, making the tax code simpler and fairer in order to create more jobs.  According to independent economists, this tax reform, when coupled with spending cuts, will lead to the creation of more than 1 million jobs in the first year alone.

 

Democrats will offer a very different plan.  The Democrat plan raises taxes on nearly 1 million small business owners and, according to a study by Ernst & Young, destroys over 700,000 American jobs.

 

This is the choice America faces: A Democrat plan to raise taxes and destroy over 700,000 U.S. jobs, or the Republican plan to make the tax code simpler and fairer and create over 1 million new jobs for American workers.

 

The Obama Economy

 

The Obama economy has hit middle-class families hard.  For 41 consecutive months, the U.S. unemployment rate has been at or above 8 percent, and nearly 13 million Americans are currently looking for work.  Despite these facts, Democrats are insisting on job-killing tax increases.  If they don’t get these tax increases, they have openly threatened to raise taxes on every American who pays income taxes. 

 

Stop the Tax Hike

 

The Democrat tax increase would kick in on January 1, 2013, due to the scheduled expiration of the low-tax policies originally enacted in 2001 and 2003, and extended with bipartisan support in 2010.

 

• That translates to a tax increase of nearly $2,200 for a family of four earning $50,000 a year.
• The total tax hike would be more than $4 trillion over the next decade.

 

The non-partisan Congressional Budget Office estimates that these tax increases, when paired with the rest of the policies that constitute the fiscal cliff we face at the end of this year, could cost America 2 to 3 million jobs.

 

Bipartisan Support to Stop the Tax Hike

 

There should be bipartisan support to stop the tax hike.  Consider the following:

• Prominent Democrats such as former President Clinton and former Obama economic adviser Lawrence Summers have spoken against increasing taxes right now.
• 40 sitting Democratic senators (counting Sen. Lieberman) voted to “stop the tax hike” in 2010.
• 85 sitting Democratic House members voted to “stop the tax hike” in 2010.

 

To learn more about the impending tax increases, read the “Ticking Tax Bomb” series: Part I provides an overview, Part II focuses on typical taxpayers, Part III shows the impact on middle-class families, Part IV focuses on the impact on seniors, and Part V focuses on the impact on small businesses.

 

A Simpler, Fairer Tax Code Will Help Create Jobs

In addition to preventing job-killing tax hikes, Republicans will take action to boost economic growth and create jobs by providing a fairer, simpler tax code that lowers rates and closes special-interest loopholes.

 

When coupled with spending restraint, the commonsense tax reform policies written by the Ways and Means Committee and included in the last two House-passed budgets will lead to the creation of 1 million jobs in the first year alone.   These reforms include:

 

• Eliminating lobbyist loopholes to reduce rates for families and employers – reducing the current six tax brackets down to just two (10 and 25 percent).
• Establishing a corporate rate of 25 percent, helping to make America competitive in the global marketplace.
• Eliminating the alternative minimum tax.
• Transitioning America to a more competitive territorial tax system.
• Refusing to bail out Washington’s wasteful spending and maintaining revenue levels in the range of historic norms (18-19 percent of gross domestic product).

 

Force Congress to Do Its Job

In three of the last five years, everything from underlying marginal income tax rates to rates on investment income has been scheduled to rise sharply – creating uncertainty for families and employers.  As part of the effort to help strengthen the American economy and restore tax fairness, we will pass a fast-track process to enact comprehensive tax reform in 2013. 

 

Building on the more than 30 different examples of “expedited procedures,” such as Trade Promotion Authority, already in law, the House Republican tax plan will include specific timelines for the House and Senate to act on comprehensive tax reform next year.