ARE YOU KIDDING ME? Not only do we have one of the highest corporate tax rates in the world but if the United States would enact the Buffett rule on top of that we would see many more business move overseas. A GIANT JOB KILLER.
Once again The Lexington Libertarian has to point out that the Democrats do not know how to grow out economy. They want to spend, spend, spend and then tax, tax, tax. That's why we call them tax and spend Liberals.
The only true job growth that isn't paid for by the American taxpayer is growth in the private sector. You don't attract private business and thus more jobs by taxing them to death and taxing investments that provide business with the capital to start up or expand. That's why they call it CAPITALISM.
On top of that, as demonstrated in his SOTU address, Obama is waging class warfare on the nation and intends to let the Bush tax cuts run out. So here is the Obama plan for our economy: spend over $1 trillion more than you take in, keep corporate tax rates higher than the rest of the world, double the rate of capital gains taxes, let the Bush tax cuts expire, increased health care taxes, taxes on energy and carbon (Cap & Trade) and you name it.
THIS IS A PRESCRIPTION TO DESTROY THE ECONOMY
Remember the moment in 2008 when Charlie Gibson of ABC News asked Senator Barack Obama why he would support raising the capital gains tax even though "revenues from the tax increased" when the rate fell? Mr. Obama's famous reply: "I would look at raising the capital gains tax for purposes of fairness." Well, we were warned.
Here we are four years later, and President Obama on Tuesday night linked the term "fair" to U.S. tax and economic policy seven times. The U.S. economy is still hobbling out of recession, real family incomes are falling and 14 million Americans are unemployed, but Mr. Obama declared that his top priority is not to reform the tax code to promote growth and job creation. His overriding goal is redistributing income.
Mr. Obama endorsed the political ruse he calls the Buffett rule, which asserts as a matter of moral principle that millionaires should not pay a lower tax rate than middle-class wage earners. Specifically, Mr. Obama is proposing that anyone earning more than $1 million pay at least 30% of that income to Uncle Barack.
The White House says that if a millionaire household's effective tax rate falls below 30%, it would have to pay a surcharge—in essence a new Super Alternative Minimum Tax—to bring the tax liability to 30%. For those facing this new Super AMT, all deductions and exemptions would be eliminated except for charity.
The Buffett rule is rooted in the fairy tale that taxes on the wealthy are lower than on the middle class. In fact, the Congressional Budget Office notes that the effective income tax rate of the richest 1% is about 29.5% when including all federal taxes such as the distribution of corporate taxes, or about twice the 15.1% paid by middle-class families. (See "How Much the Rich Pay," January 23, 2012.)
This is because wealthy tax filers make most of their income from investments. Such income is taxed once at the corporate rate of 35% and again when it is passed through to the individual as a capital gain or dividend at 15%, for a highest marginal tax rate of about 44.75%.
This double taxation is one reason the U.S. has long had a differential tax rate for capital gains. Another reason is because while taxpayers must pay taxes on their gains, they aren't allowed to deduct capital losses (beyond $3,000 a year) except against gains in the current year. Capital gains also aren't indexed for inflation, so a lower rate is intended to offset the effect of inflated gains.
One implication of the Buffett rule is that all millionaire investment income would be taxed at the shareholder level at a minimum rate of 30%, up from 15% today. The tax rate on investment income from corporations would rise to 54.5% from 44.75%, a punitive tax on start-up or expanding businesses.
The new 30% capital gains rate would be the developed world's third highest behind only Denmark and Chile, according to the American Council for Capital Formation. This is on top of the 35% corporate rate that is already the second highest rate in the world after Japan. That giant sucking sound you hear come January 2013 would be hundreds of billions of investment dollars fleeing to China, India, Korea and other U.S. competitors. Lower capital investment in the U.S. means less wage growth, and so the people hurt most by this tax hike would be workers, according to a study by the Institute for Research on the Economics of Taxation.
Yet in a time of the highest deficits since World War II, Mr. Obama wants to double the capital gains tax rate even as he raises the top income-tax rate to 42% or so. Mr. Obama really is taking us back to the worst habits of the 1970s. And not because he thinks higher rates will raise revenue, but merely so he can score points against Mitt Romney and stick it to the successful.
This isn't tax fairness. It's tax folly.(1)
America Before President Obama Took Office and Now
Before
Now
Change
Number of Unemployed1
12.0 Million
13.1 Million
+9%
Long-Term Unemployed2
2.7 Million
5.6 Million
+107%
Unemployment Rate3
7.8%
8.5%
+9%
“High Unemployment” States4
22
43
+95%
Misery Index5
7.83
11.46
+46%
Price of Gas6
$1.85
$3.39
+83%
“Typical” Monthly Family Food Cost7
$974
$1,013
+4%
Median Value of Single-Family Home8
$196,600
$169,100
-14%
Rate of Mortgage Delinquencies9
6.62%
10.23%
+55%
U.S. National Debt10
$10.6 Trillion
$15.2 Trillion
+43%
(1)
The Buffett Ruse, Wall Street Journal
http://online.wsj.com/article/SB10001424052970203806504577183250095478594.html?mod=djemEditorialPage_h
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