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Indulges Spending Habits: A Tax Happy Federal Budget

March 26, 2008
We are about to be soaked by a very heavy increase in taxes and implementation of tax strategies that will more than take your breath away, it will also take your life style.  This blueprint has been crafted, and my congressman has exposed it in this great article in the Richmond Times-Dispatch.  Read every word, and call your Congressman and Senator and get them back in line.

Indulges Spending Habits:
Richmond Times-Dispatch
March 25, 2008
By Eric Cantor, Guest Columnist
cantor_headshot_300dpi.jpgA Tax Happy Federal Budget
When your tax rebate comes in the mail later this spring, you'd better hang onto it. At least that's the message House Democrats sent when they muscled through the blueprint for a tax-happy federal budget.

More than canceling the stimulus benefit of the rebate checks, it would soak Virginians with an average annual tax hike of $3,120. And on taxpayers already plagued by high costs of gas, food, and health care, it imposes an unbearable burden. In an economy reeling from shrinking home values and job markets, Virginia workers, families, and small-business owners simply cannot afford it.

The budget's five-year, $683 billion tax increase almost triples the largest tax hike ever recorded in 1993. The whopping sum stems from the scheduled income tax hikes that will take effect on Dec. 31, 2010.

Peddlers of class warfare may claim the soon-to-expire tax relief of 2001 and 2003 was nothing but a grab bag for the rich. Not so. If they expire, tax increases would cast a wide net across the economic spectrum, deeply affecting the middle class. Some examples of what they would do:

  • RAISE THE current "10 percent tax bracket" to 15 percent. This would increase the burden on all American taxpayers, especially the lowest income earners. All filers would pay a higher rate on their first roughly $7,500 or $15,000 of income (depending on whether they file individually or jointly).
  • Implement an across-the-board increase on marginal income tax rates. This would target not just the top bracket; it's a tax increase aimed straight at middle-class taxpayers and small businesses, which often file under ordinary income rates. 
  • Reinstate the marriage penalty. Approximately 23 million married couples would be affected.
  • Slash the $1,000 per-child tax credit in half.
  • Increase taxes on dividends, which often supplement the income of senior citizens relying on Social Security.
  • Increase taxes on capital gains, which drive growth and encourage Americans to invest their money.
  • Reinstate the estate tax, which is considered the largest impediment to transferring familyowned business from one generation to the next.

The consequences are chilling for ordinary Virginians.

A family of four that earns $60,000 would see its tax bills rise by 70 percent in 2011. A single parent with two children and $30,000 of income would face a 67 percent reduction in benefits provided through the tax code. Meanwhile, an elderly couple with $40,000 of income would get hit with a 156 percent tax increase in 2011.

WHY THE TAX increases? To finance the bloated budget's spending increases. Nondefense discretionary spending exceeds the president's request by a staggering $23.4 billion. I voted to tame the budget by imposing a one-year moratorium on the thousands of earmarks for pet projects. This effort would have saved $17 billion and begun to change the spendthrift culture of Washington.

The budget also lacks the creative and innovative thinking we need to solve our most pressing problems. To moderate soaring health care costs, we need a federal income tax credit for individuals who buy their own health insurance. The credit would offer the same advantage that businesses have for their employees. And to wean ourselves off foreign oil and curb rising gas prices, we need a bold plan to increase federal investments in alternative energy sources like wind, solar, and nuclear energy.

Indulging Washington's huge spending habits while doing nothing to address our tremendous challenges may make good politics, but it's not real leadership. There's a way for Washington to start working again for the American people, and it's not by taxing them into submission and chasing jobs away. Now more than ever, we need a fiscal policy that spurs job growth and investment, and rewards people for hard work. The Republicans' alternative budget keeps taxes low and reins in wasteful spending. It would serve as tonic for our economic ailments.
Eric Cantor, a Republican, represents Virginia's 7th District and is chief deputy whip in the U.S. House. Contact him at (202) 225-2815 or through his Web site,
SOURCE: Richmond Times-Dispatch Published with permission from both the Richmond Times Dispatch and Eric Cantor, my representative and deputy whip in the U.S. House. 

Call to Action:
Take Action:Please call your Representative and your Senators and tell them NO MORE TAXES.
Balance our checkbook! Call Your Members of Congress Today! Capitol Switchboard: (202)-224-3121

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