Michigan Republican Dave Camp, the chairman of the powerful tax-writing Ways and Means Committee, gave Treasury man Timothy Geithner a tough spanking this morning. In a hearing on the president’s budget, Camp stated that nearly $2 trillion in tax increases will take more money away from employers, investors, and savers, and would push the top rates close to 45 percent. Camp noted that the bottom half of earners pay no federal income taxes, and that 70 percent of income taxes are paid by the top 10 percent, a group which includes the small businesses that are so important to job creation.
Why should Uncle Sam take nearly half of their income?
Camp then honed in on the Obama proposal to triple the tax on dividends from 15 percent to nearly 45 percent. The chairman went on the say, “Because dividends are paid out of income that has already been taxed at the corporate level and then are taxed again in the shareholder’s hands, this proposal would push the total federal tax rate on dividends to 64 percent.” (Italics mine.)
Camp next hammered Geithner on corporate tax reform. As in, “Where is your plan?” As in, “The U.S. will have the highest corporate tax rate in the industrial world.” Camp asked Geithner why the U.S. is at a competitive disadvantage in the world marketplace. (I would note that while the U.S. corporate rate is 39 percent, Canada’s combined federal-provincial corporate tax is 25 percent.) Camp could have added that Team Obama is going to have a corporate tax plan, and that it will raise $350 billion, including $150 billion for something called a “global minimum tax,” a new tax that has nothing to do with tax reform.
Finally, Camp hit Geithner on the debt problem, stating that our total debt load is now 102 percent of GDP — certainly a warning point for future economic growth.
I’m glad Dave Camp is on the warpath. One thought: He should report his bold corporate-tax-reform plan out of committee and onto the floor, where the GOP House can then pass an exemplary pro-growth, corporate-tax reform to turn up the heat on the White House and the Democratic Senate.
With interests rates paying next to nothing, the stock market flat (except over the past couple of months), the last source of income for retirees was dividend stocks. Now Obama wants to raise their taxes to 40%.
I'll use the example of my parents; average, middle class folks who were smart and saved all his life. Lived on a single income. We didn't have a lot growing up. Dad retired last year, and now has to rely on dividends because interest rates are so obscenely low. He's not rich! Why should someone who draws about $60k in dividends have to pay Uncle Sam 40%?!!
Class warfare? The war is against people who have scrimped and saved all their life! The warfare is against people who are self-reliant! The war is against people who have no need of government handouts!
Reply to this commentLinkReport AbuseIf Romney had explained the difference between capital gains taxes and income taxes he would have done the country a service. It might not be too bad to talk about taxes on 401k withdrawals either. The Boomers are just entering retirement. Some might even be selling their biggest "investment," their home. Romney may be a financial whiz but he is completely out of touch with the concerns of the largest, and richest, population segment in the country. I'll bet even some of the OWS inmates have parents who have assets they hope one day to inherit.
Reply to this commentLinkReport Abuse"…would push the top rates close to 45 percent. … Why should Uncle Sam take nearly half of their income?"
I hate to be the voice of reason here, but marginal tax rates are not the same as average tax rates. You would only be paying the 45% on the portion of income over ~$375k. If you make $1 million, you would still pay the same rate on the first $100k as someone who made $100k overall.
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