Monday, January 15, 2007

Beginning of the End for taxpayers

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On Thursday, the House of Representatives will vote on legislation to increase taxes for the first time since 1993. It took just 15 days of new found power for the Democrats to raise taxes. The first vote of the 110th Congress removed the 3/5 supermajority to raise taxes. The following day was a vote to enact a new rule requiring offsetting tax increases for every tax cut.

So it was only a matter of time before the first actual vote to raise taxes came up. The significance of this should not be underestimated as Thursday's vote is the first step in reversing what could be considered the best run for American taxpayers since the creation of the income tax. Using the Treasury Department study by Jerry Tempalski we count the longest run between legislation being enacted into law with a net tax increase occurring from 1952 through 1966. The 15-year period is slightly longer than the current 13-year period but it is our hope President Bush will veto these tax increases through 2008. After 2008 all bets are off and $586 billion of tax cuts are in the pipeline from 2008-2016 making them ripe candidates for repeal.