Wednesday, January 1, 2014

Unrealistic Taxes

The Washington times says, "2014 begins with $54 billion in tax hikes".
This is somewhat of a misrepresentation, with the implication that new taxes amounting to $54 billion are being applied to the general public. In fact, the $54 billion is a calculated elimination of exemptions for special benefits previously obtained by various groups. Some of these are as follows:
1. Research tax credits.
2. Subsidies for wind turbines.
3. Tax deductions for improving building energy efficiency.
4. Tax credit for college tuition.
5. Tax deductions for state and local taxes.
6. Tax deductions for mortgage insurance.
7. Tax credits for purchasing classroom supplies.
8. Lower fares on subsidized transit systems.
9. Employment benefits from Trade Adjustment Assistance
The Congressional Research Service identified 7 tax credits for individuals that expired at the end of 2013, and another 49 aimed at businesses and investors. If one were also considering a general revision of the tax code, thousands of special tax breaks could come under scrutiny.
The key point with all of these "tax hikes" is that they all have a commonality of special exemption, which should not be part of any tax system. The only reason they are there is for political gain by Congress and others in government to buy votes to continue to hold their jobs.
I am normally an opponent to new federal taxes, because increased revenue to the federal government only increases the size and power of government, which is already excessive. However in this case, I agree with the tax hikes, because it starts to bring realism to the whole economic and tax system of government. Hopefully, the more the public recognizes tax reality, the greater will be its resistance to further taxes.
Unfortunately according to the Washington Times, Congress is likely to reinstitute many of these exemptions to individuals and special groups.
Looking at the bigger picture one can easily see that Congressional buying of votes through special exemptions is a motivating force for this inequality. The only solution is for each Representative and Senator to have a term limit for his employment by government. Only then will Representatives and Senators be able to keep their eye on the ball of what is best for the country and its citizens. I encourage all new contenders for a congressional office to indicate whether they are for or against congressional term limits, and the public should pay close attention to that reply and vote only for those who say they will vote for congressional term limits.

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