For Immediate Release
Office of the Press Secretary
May 28, 2008
Fact Sheet: the Largest Tax Increase in History Is Looming
In Focus: Economy
Today Marks The Five-Year Anniversary Of The 2003 Tax Relief, Which Congress Should Make Permanent
President Bush's 2001 and 2003 tax relief fueled economic growth and reduced the marginal rate for every income tax bracket. By the end of last year, Americans would have paid an additional $1.3 trillion in taxes had it not been for the President's tax relief. If the President's tax relief is allowed to expire at the end of 2010, Americans will pay about $280 billion more in taxes each year. With the largest tax increase in history looming, Congress should make the President's tax relief permanent.
Congress Needs To Act Now To Prevent Tax Increases
If the President's tax relief is allowed to expire, every income taxpayer will see an increase. Taxes will increase for 116 million income taxpayers who will see their taxes go up by an average of $1,800. It will force many families to accept a nearly 200 percent tax increase. In addition:
These pending tax increases will be devastating for average American families. A typical family will pay $500 more per child in taxes, and 43 million families with children will face an average tax increase of $2,323. American families are facing higher costs in the grocery line and at the gas pump. Americans deserve to keep more of their income. If Congress allows the President's tax relief to expire:
Democrats in Congress have signaled their support for the massive tax hike by refusing to extend President Bush's tax relief. If Congress does not act to make the tax relief permanent, the death tax will come back in full force. In addition, the tax rate on dividends will return to a maximum of 39.6 percent and the top tax rate on long-term capital gains will climb from 15 percent to 20 percent.
Americans Need Assurance That More Of Their Hard-Earned Money Will Not Be Taken
These pending tax increases are harmful to our economy. Nearly 75 percent of the taxpayers who benefit from the reduction in the top rate are small business owners. The looming tax increases are affecting today's economy by creating uncertainty, which causes small businesses to think twice about expanding or hiring new workers. These tax increases will harm economic growth by taking more money from small business owners and sending it to politicians in Washington.
Allowing this tax relief to expire would force more low-income Americans to pay income taxes and reduce the share of income taxes paid by the highest income-earning Americans. Six million American households will be added to the income tax rolls, and low-income families with one or two children wouldn't be eligible for the refundable child tax credit.
President Bush's Tax Relief Allows Americans To Keep Trillions Of Dollars Of Their Own Money
In this time of economic uncertainty, one of the worst things we could do to our economy is raise taxes on the American people. Thanks in part to the President's tax relief, our economy continues to grow. President Bush's tax cuts has provided $1.3 trillion in relief through 2007 and will continue to provide:
Higher taxes on new investment means less new investment and slower growth. The President's tax relief has reduced the marginal effective tax rate on new investment, which encourages additional investment and in the long-term, higher living standards for workers.
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