"Tax revenues would skyrocket if the tax cuts expire, due to "bracket creep." Average incomes are higher today than in the 1990s, but income-tax brackets aren't adjusted for the growth of earnings. As a result, Americans will shift into higher tax brackets and pay a greater share of their incomes in taxes.

Going back to the tax rates of the 1990s doesn't mean that households will pay 1990s taxes. Because the tax brackets haven't risen along with incomes, average taxes would be significantly higher, and grow each year.

... So even if the tax cuts are made permanent, future Americans will pay a greater share of their incomes to the government than in the past. But for some in Washington, that's not enough."

    Pinning down Congressional Democrats’ positions on taxes is kind like trying to castrate a waking bull… and about as practical.  They simply won’t give it up.  I remember once, New York Senator Daniel Patrick Moynihan – who was about as straightforward as Washington Democrats get – was asked if Americans are taxed too much.  Moynihan answered, “Well, they’re taxed wrongly.”  Notice how the dodge, as in a champion middleweight, effortlessly flows into the counterpunch.

    Unfortunately, the current crop of Democrats in Congress aren’t Pat Moynihan – as George Will has noted, Moynihan wrote more books than most of his colleagues read.  They’re not as straightforward and not as bright.  Ask them what they want to do about taxes, and, like on most issues, the first thing they say is that they hate what President Bush did.  So, what would they do differently?  Well, they want to make the tax code fairer?  How?  By taking away loopholes for the rich.  Which ones?  The ones that working class families can’t use.  Which are they? 

    No answer.  Listening to the Democrats, you get the sense that they definitely think taxes should be higher than they are, but they’re loathe to admit which ones.  Meanwhile, as we noticed throughout the last tax debates in 2003, the only income taxes Democrats think should be lowered are the ones on people who don’t pay income taxes at all.  So, what do they really believe?

    This tax day, Americans should make a real effort to find out what the Democrats really want to do with the Internal Revenue Code.  Conservatives, especially those represented by Democrats in Congress, should be flooding their members’ offices with letters and emails and phone calls asking exactly what their Senators and Representatives want to do on taxes.  Do they believe taxes should be higher?  Which ones?  Lower?  Again, what are the specific proposals?

    Or more importantly, what about fundamental tax reform.  Since no thinking person honestly believes the current system is an efficient means of generating revenues for the government, what would your representatives do if they could rewrite the code from scratch?  A flat tax?  A national sales tax like the Fair Tax? 

    Democrats have made no secret of their mistrust of the American with our own money; the least they can do this Tax Day is tell us exactly how they want to take it.

Farmers rebeled earlier this month when the government announced an increase in export taxes on agricultural products. Claims that the government's new "retention" rates -- aka export taxes -- are close to an expropriation are not without merit.

... In response to the tax increases, farmers have blocked roads in some 300 locations around the country, pledging not to allow their goods to reach markets. The effects of the action have been felt in the capital, where demonstrators have taken to the streets in sympathy for the farmers and against what they say is government arrogance. The strike is now in its third week.

Mrs. Kirchner says the tax increase is a redistribution mechanism, suggesting that growers and ranchers have to be forced to share more of their good fortune with others. But the greater motivation behind the export-tax increase is inflation.

This government, it seems, will do just about anything to reduce inflation except the one thing that would solve the problem: Let the peso strengthen.

I would think the best comparison for Argentina would be Jimmy Carter’s attempts are price controls in the late 70s.  Price controls did not work in Roman times and they still do not work today. 

Of course, tax rebellions are nothing new.  Interestingly one of the tactics the farmers are using is blocking roads.  Today, Pennsylvania truck drivers are striking and protesting against high gas taxes.  Some have speculated they may also attempt to block roads ...

Yesterday morning, I predicted a Barack Obama Administration would make you and I less wealthy. 

Wasting no time to prove me right, yesterday on CNBC, Barack Obama said he wanted to raise the capital gains tax.  

"I haven't given a firm number," he said. "Here's my belief, that we can't go back to some of the, you know, confiscatory rates that existed in the past that distorted sound economics. And I certainly would not go above what existed under Bill Clinton, which was the 28 percent…. My guess would be it would be significantly lower than that. I think that we can have a capital gains rate that is higher than 15 percent."

... I probably don't have to tell you this is exactly the wrong direction in which we should go.  Raising taxes during an economic downturn is insanity.  Of course, Obama will attempt to argue this is a tax for the rich.  In truth, it's a tax on anyone who is an investor.  Increasing the tax, of course, discourages investment in our economy (just what a struggling economy needs, right?) ... 

Rudy Giuliani's tax plan, which, at the time, I praised, promised to lower the capitol gains and dividend rate to 10% and index to inflation. 

I argued Rudy should have gone further and completely eliminated the capitol gains tax.  I still believe that's true.  Not only should we not raise the tax -- we should eliminate it.

By the way, ABC's Jake Tapper has an excellent post up on this ...

Today, the Institute of Policy Innovation (IPI) awarded “A’s” in Tax Policy 101 to thirty-five members of the House.  Not coincidentally these thirty-five members all voted against the “stimulus package” that passed the House on January 29.  Yours truly was among them.  In fact, I was the only one to speak out against the package on the floor.  You can find the ten Democrats and the twenty-five Republicans that also voted against it below.

Brian Baird (D-WA)
Marion Berry (D-AR)
Allen Boyd (D-FL)
Paul Broun (R-GA)
Michael Burgess (R-TX)
John Campbell (R-CA)
Howard Coble (R-NC)
Jim Cooper (D-TN)
Barbara Cubin (R-WY)
Tom Davis (R-VA)
Nathan Deal (R-GA)
Jeff Flake (R-AZ)
Randy Forbes (R-VA)
Phil Gingrey (R-GA)
Louie Gohmert (R-TX)
Virgil Goode (R-VA)
Duncan Hunter (R-CA)
Tim Johnson (R-IL)
Marcy Kaptur (D-OH)
Jack Kingston (R-GA)
John Linder (R-GA)
Ron Paul (R-TX)
Collin Peterson (D-MN)
Ted Poe (R-TX)
Tom Price (R-GA)
Dana Rohrabacher (R-CA)
Ed Royce (R-CA)
Loretta Sanchez (D-CA)
James Sensenbrenner (R-WI)
John Shadegg (R-AZ)
Adam Smith (D-WA)
Tom Tancredo (R-CO)
Gene Taylor (D-MS)
Lynn Westmoreland (R-GA)
Robert Wexler (D-FL)

I ,____________, pledge to the taxpayers of the _____ district of the State of _________ and to the American People that I will:

ONE, oppose any and all efforts to increase the marginal income tax rates for individuals and/or businesses; and

TWO, oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates.

Grover Norquist asked the candidates via his YouTube submission if they would sign the pledge.   Tancredo, Huckabee, Romney and Giuliani said yes.   Thompson, McCain, and Ron Paul said they don't sign pledges and Americans should trust their records.  Duncan Hunter said he wouldn't because he didn't want his hands tied in case of an economic emergency.

In a recent column, the Washington Post’s E.J. Dionne, Jr. unwittingly exposed the vast ideological gap between Republicans and Democrats.

Dionne chose to praise Maryland’s new Democratic governor Martin O’Malley for a massive tax increase designed to close the state’s $1.7 billion budget deficit. Hailing O’Malley’s decision as “government for grownups” the columnist noted that the liberal Democrat “led the Maryland legislature to approve $1.4 billion in taxes and $550 million in spending cuts. It has been a long time since we’ve seen that kind of balance from the federal government.”

Say what?

Does Dionne honestly believe that spending cuts of $550 million actually balance tax increases that are nearly three times as large? Is a revenue-raising plan that’s 72% tax hikes, and 28% spending trims, in any real sense “balanced”?

Dionne goes on to note that O’Malley raised the income tax rate for top wage earners from 4.75 percent to 5.5 percent – a hefty increase of some 16%. To him, this represents “a modest step in the right direction.”

E.J. Dionne clearly wishes that Governor O’Malley had gone even further than he did in boosting taxes, and not relied on placing 15,000 new slot machines around the state to produce additional revenue, but he still clearly celebrates the liberal leader’s initiative: “The sound you are hearing not only in Maryland but in state capitals across the nation,” he writes, “is the crashing and crumbling of ideology, specifically a right-wing ideology that demonizes taxes and government….”

Actually, conservatives don’t “demonize” taxes and government, but honestly acknowledge that whatever worthy goals tax hikes might fund, they mean less money in the hands of the people who earned it.

Republicans believe that individual earners can make better decisions about spending their own money than bureaucrats who seize it. Democrats like Dionne maintain an unshakable faith in the superior wisdom of government officials and the political class to spend the people’s hard-earned gains.

This remains the permanent, fundamental difference between the two parties – an undeniable distinction that means more than all other arguments about social issues, the cost of health care, immigration, or time-tables for Iraq withdrawal.

Those who believe that it shows admirable “balance” to close a yawning deficit by raising tax rates, or who consider a 16% rise in top rates a “modest step in the right direction,” or who believe that the desire for reduced tax burdens and less intrusive government amount to unjustified “demonization,” will no doubt vote Democratic in the next election.

Those, on the other hand, who reject these assumptions and find Dionne’s column unintentionally revealing, must stick with the GOP and its consistently tax-averse candidates – regardless of their innumerable foibles and shortcomings on a host of other issues. If we hope to avoid a repeat of the Maryland model on the national stage, conservatives must rally behind Republican candidates who can win – for the House, the Senate and, above all, the White House.

[1]As discussed in Purchasing Power vs. the Tax Rate, H.R. 25 proposes a tax inclusive sales tax rate of 23% on all retail purchases of goods and services. Sales taxes are traditionally described and administered on a tax exclusive basis. This is a distinction with a significant difference. A 23% tax inclusive sales tax rate is precisely equal to a 29.87013% (rounded to 30%) tax exclusive rate. This paper refers to the tax rate as proposed in H.R. 25 as 30% so that the tax rate may be more accurately compared and contrasted with other tax rates which are traditionally described on a tax exclusive basis.

As you know, I recently relocated to MD to take a good position as a 
college professor.  MD is a VERY blue state and recently replaced 
Governor Robert Ehrlich with the VERY liberal former Mayor of 
Baltimore Martin O'Malley.  Recently Gov. O'Malley called a special 
session of the VERY BLUE legislature to deal with a huge budget 
deficit (read gross entitlements and over expenditures).  I give you 
one guess what the result was.  Yes indeed you guessed it, a MASSIVE 
tax increase and class warfare.  Here are the basics as reported by 
the Annapolis Capital:

Income Taxes:  Changed from a flat tax (4.74%) to a graduated tax 
with three brackets 5% for single filers who make $150K or more and 
joint filers who make $200K; 5.25% for singles making more than$300K 
and joint filers making more than $350K.  If you make more than $500 
K you pay 5.5%

Exemptions:  Kept the same for middle and lower income filers but 
soaking those who make more by reducing their exemptions (So we soak 
you for making more AND we get even more by reducing YOUR exemptions)

Sales Tax:  1% increase to 6%

Tobacco Tax:  Double from $1 to $2 per pack (hmmm, who does this 
little sin tax afffect?  Lower income folks who are the predominant 
smokers )

CORPORATE INCOME TAX:  ( This is thievery)  Raised from 7% to 8.5%!  
MD is now officially industry's enemy and I predict many will now 
look to move to other less oppressive states (DE, VA, PA, NC).  How  
many jobs will be lost and of course the slime Dems will blame evil 
corporations.   Those who stay will pass this tax on to consumers.

Titling Tax:  Raised from 5% to 6% again sticking it to consumers of 
vehicles.

THIS is what happens when democrats take over.  If Hillary wins in 
2008 and the House and Senate get larger Dem majorities we can all 
expect to be declared rich and have our wealth confiscated.

It's amazing.  For the first time in my life I am making an above 
average wage and MD is going end having me net LESS even though I get 
military retirement (which they tax of course) and my current salary.

I predict that many hard working citizens in MD will now look to 
relocate.  I've only been here for 4 months and I am looking for work 
in more tax friendly states.  There is going to be white collar 
flight from MD and it will not close its deficit and will ultimately 
take in LESS revenue as we have seen so many times with these types 
of confiscatory tax schemes which pit hard working folks against 
those who don't do as well financially.

Americans for Tax Reform, a non-partisan watchdog group, has put together some interesting facts about Chairman Rangel’s infamous “Mother of all Tax Reform” bills.  As you know, I have already written several times about Mr. Rangel’s proposal, but I had to share some of ATR’s findings with you:

Rangel Tax Hike Fact of the Day  #1 (Courtesy of Americans for Tax Reform)

“You don’t have to raise taxes to pay for an AMT patch or for full AMT repeal.”

Charlie Rangel sure does like tax increases.  In fact, his large grab bag of tax increases in H.R. 3970 is almost too much to keep up with.  To pay for full AMT repeal, Rangel suggests imposing a surtax of up to 4.6% on families earning as little as $150,000 per year.

Someone should have told Rangel that several Republican Congressmen have introduced measures to fix the AMT without raising taxes.

The House Republican Study Committee (RSC) has introduced H.R. 3818, the “Taxpayer Choice Act of 2007.”  This bill would repeal the AMT, and implement an optional “simplified income tax” system with a top rate of only 25% (15% for capital gains and qualified dividends).

Charlie Rangel has a choice: steal out of one pocket to put money in the other, or actually make progress.  He should patch the AMT by holding families harmless, and should work to repeal the AMT and replace it with a simplified income tax.

To access more Rangel Tax Facts, go to www.atr.org