March 29, 2007

Congressman Pitts Opposes Largest Tax Hike in American History

Washington—Congressman Joe Pitts (R, PA-16) today voted against H.Con.Res. 99, the Democrat budget resolution for fiscal year 2008.  By doing away with the pro-growth tax relief enacted in 2001 and 2003, the budget plan would effectively bring about the largest tax increase in American history – nearly $400 billion dollars over five years.

“Democrats have been on a spending spree since taking power in Congress, and this week, they handed the taxpayer the bill,” Congressman Pitts said.  “This budget represents tax-and-spend politics at its worst.  It will leave hardworking American families with less money in their pockets, and seriously threaten the strong economic growth we’ve experienced over the last three years.”

Historic Tax Hike

Democrats are boasting that their plan will produce a balanced budget in five years.  However, the revenue numbers their budget assumes in order to achieve balance assume the expiration of the tax relief enacted in 2001 and 2003.  The result would be a $392.5 billion tax hike on hardworking Americans.  4.7 million Pennsylvanians would see their taxes go up by an average of $3,029.  Nationally, this tax hike would be paid for by virtually every single working American:

·        115 million taxpayers would see their taxes increase, on average, by $1,795 in 2011.

·        83 million women would see their taxes rise, on average, by $2,068.

·        48 million married couples would incur average tax increases of $2,899.

·        Taxes would increase, on average, by $2,181 for 42 million families with children.

·        12 million single women with children would see their taxes increase, on average, by $1,082.

·        17 million elderly individuals would incur average tax increases of $2,270.

·        Taxes would rise, on average, by $3,960 for 26 million small business owners.

·        Over 5 million taxpayers who previously owed no taxes would become subject to the individual income tax as a consequence of the sunset.

Budget Gimmicks

House Democrats have attempted to hide their budget’s fiscal irresponsibility by using a budget gimmick known as a “reserve fund.” 

These reserve funds – 12 are included in the House Democrat budget – appear to designate funding for a host of spending, from farm programs to education.  In reality, however, they are empty.  In order to fund them, offsets would have to be made elsewhere, or taxes would have to be raised.  Since the budget makes no offsets, the only option would be further tax hikes.  In total, it would require $115 billion of additional spending to provide for these reserve funds.  With no offsets, that would mean $115 billion in tax hikes on top of the $392.5 billion that the budget already calls for.

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