The federal government is expecting annual budget deficits of about $1.5 trillion.
The national debt is $12.8 trillion, and growing.
Tennessee and many other states are having budget problems.
Counties and cities are facing economic pinches.
Our economy is in general recession, with unemployment about 10 percent.
So this is certainly no time for anyone to propose any tax increases.
But beware! Some liberal politicians want to take more of your money in taxes — if they can do it without a political explosion.
The basic problem is not that taxes are “too low” but that government spending is “too high.”
Too many politicians want to buy our votes by promising to “give” us something, or “give” certain groups of voters something. But nothing is “free.”
The top U.S. individual income tax rate is now an outrageous 35 percent! But it got that “low” because of “temporary” tax cuts under the Bush administration. Now the Obama administration has indicated it intends to let that too-high 35 percent rate expire in January — so the top income tax rate would return to 39.6 percent!
But that’s just part of the tax-increase threat. Unless action is taken to avoid it, the tax rate on dividends will rise from 15 percent to 39.6 percent, and the capital gains tax will go up from 15 percent to 20 percent next year — and to 23.8 percent in 2013.
Some people may think those tax increases won’t affect them. But any tax increases will tend to depress our economy, and thus adversely affect all of us. So such tax increases should not be allowed.
Instead of seeking ways to raise taxes, Congress should be seeking ways to cut unnecessary spending. We need lower taxes to encourage economic growth, produce more good jobs and reduce budget deficits.
But have you heard that some want to impose a new “value-added tax” (VAT) on all of us?
A VAT is a kind of national sales tax that some countries in Europe have adopted. It is a “hidden tax,” since it is levied at each stage of production, and thus may just seem to be a normal part of the price of any item. But it may be 20 percent.
A value-added tax should be avoided in the United States.
That’s why Sen. John McCain, R-Ariz., led the Senate a few days ago in adopting a Senate resolution that said, “It is the sense of the Senate that the Value Added Tax is a massive tax increase that will cripple families on fixed income and only further push back America’s economic recovery.”
The resolution was approved by a vote of 85 to 13. But while a value-added tax thus does not seem to be in immediate prospect in the Senate, no one should get the idea that only 13 senators want to take more tax money from the American people.
Government spending is too big. Taxes are too high. But some tax increases are threatened unless a majority in Congress — and the American people — act soon to reject any tax increases.