Taxes Are Going Up, Fasten Your Seat Belt
Posted by GSDispatch Editor in by The Lee's Summit Conservative, GSD Online
Lee’s Summit, July 7, 2010 – I recently wrote a blog on the new tax rates: the expiration of the Bush Tax cuts. I find it fascinating to watch where the tax rates were at the end of the Clinton administration. I also find it puzzling as to why they were not at least somewhat changed to keep the fairness to the lower wage earners. The people that are affected most by the tax rates.
The lowest tax rate is being affected in two ways that I cannot make heads nor tails out of. The first thing is that the lowest rate is going up 50% (from 10 to 15%) and the old marriage penalty is coming back. So the people who earn the least, who fight to make ends meet with husband and wife working, are going to get hit the hardest – proportionately.
What happened to the campaign promise of “no new taxes for those making less than $250,000?” This may be semantics but congress had a chance to make the change to the lowest tax bracket and make the 10% permanent. But for whatever reason this was not done. For once I have to say I’m truly disappointed at the harsh impact of the tax rates on the low end of the scale.
If that’s not enough the Health Savings Accounts are increasing their penalty for early withdrawal, the Flexible Spending Accounts for special needs kids are being capped, and the general FSA and Health Reimbursement Accounts face the strong possibility of being eliminated.
You may say that only the upper wage earners can take advantage of those, but the reality is that where I work, our hourly people make every effort to put aside money for health issues that may arise. I see ten dollar an hour people fight their own budgets as hard as they can, to take some relief from potential medical bills. They may not take advantage of the 401K’s and other things, but they know their own health issues and expenses and are willing to make great sacrifices to put money aside. Why are those facing elimination, before their replacements are in place?
It is truly in the vocabulary of actions that our elected officials, Democrat or Republican seem to fail. Their actions tend to not match their words, or their intent. On the one hand they talk about creating jobs, but then they suck the money out of the system by allowing the tax cuts that got us out of the last recession expire; putting additional burdens on the economy, the small businesses (the engine of our last recovery) and the eight million people who are unemployed.
Business runs on money and on certainty. The greatest difference between the US and most other countries outside of Europe is that our business climate is predictable and stable. But for the last two years we’ve been as uncertain of our business future costs and tax burdens as any 3rd world country. When there is doubt, don’t spend, don’t hire, don’t plan on growth. In the end the ones who suffer the most are those at the low end of the wages, and Congress along President Obama’s lack of action are allowing the 15% tax rate to return, increasing it from 10% during the last 9 years.
Where is the laser focus on the economy that was the main piece of the State of the Union Address back in January? Where is the “no new taxes” promise to the lower income brackets? They were lost in the vocabulary of rhetoric. They did not participate in the vocabulary of actions.
As we approach August 3rd here in Missouri we have to know our candidates well, and we must understand the issues that are going to be on the ballot, and we have to vote from knowledge.
Hope to see you at the polls, it is your right and responsibility as an American.
Respectfully Submitted,
The Lee’s Summit Conservative
