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Thursday, March 26, 2009

Still More Taxes?

The Obama budget plan includes various tax hikes that will hurt entrepreneurs, investors, business and the economy. Those include higher personal income, capital gains and dividend tax rates on upper income individuals; keeping the death tax around; and imposing a cap-and-trade regulatory/tax scheme.

But that apparently is not enough. The March 25 Wall Street Journal reported the following:

The White House said it would launch a search for new tax revenues, as Congressional leaders moved to scale back proposed spending increases and tax cuts in President Barack Obama's ambitious budget. The Obama administration plans to create a task force to consider elimination of corporate loopholes and subsidies, tougher enforcement against tax avoidance, and tax simplification, White House Budget Director Peter Orszag said late Tuesday.

A task force to, in effect, raise more taxes – is this really what the economy needs right now?

Congress is absolutely right to be concerned about the current explosion in government spending. But are they serious? Initial congressional budget numbers indicate more posturing than serious action on reining in spending.

Obviously, government looking to suck even more resources out of the private sector is not the answer to our budget or economic woes. If too much spending is the problem – which it is – then we obviously need sharp reductions in that spending, not higher taxes.

Raymond J. Keating
Chief Economist
Small Business & Entrepreneurship Council

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