Later this week, the House is expected to vote on the Conference Report for the Democrats’ FY2008 budget.  Hold on to your wallets, because if this bill passes, it will amount to the second largest tax hike in U.S. history – increasing taxes by at least $217 billion by 2012.  The House Budget Committee provides the following details, each more ominous than the last:

- The agreement includes a tax hike of at least $217 billion by fiscal year 2012.

- This includes increases in marginal rates, capital gains rates, dividends taxes, and others.

- It also includes an additional “trigger” tax hike:  If surpluses do not materialize – i.e. Congress spends too much – a tax hike “trigger” will automatically raise taxes even higher

- This would raise the Democrats’ tax increase right back to the House-passed $400 billion – the largest tax hike in American history.

- The bill provides only a minimal one-year patch for the mounting Alternative Minimum Tax crisis.

Stay tuned to see how the debate plays out in Congress – will the forces of big government trump the needs of American taxpayers?  We hope not… but we’ll wait and see.

Four years ago this month, Congress passed (and the President signed into law) the 2003 Jobs and Growth Tax Relief Reconciliation Act, which reduced taxes and strengthen the American economy.  Thanks to this bill (as well as tax relief passed in 2001), the U.S. economy has created millions of new jobs and our federal revenue has grown, reducing the deficit. In fact, in a May 11th letter to the House Budget Committee, OMB Director Rob Portman noted, “The proven formula of keeping taxes low while restraining spending has decreased the budget deficit by over $165 billion in the last two years.”

However, this month’s anniversary is bittersweet.  The Democrat budget proposal this year does away with many of these provisions, raising taxes on millions of Georgia families. Phil firmly opposes any budget that results in a ludicrous tax hike for American workers.  To learn more about what Phil is doing to lower taxes, click HERE.

The Tax Foundation recently released the results of a poll showing the vast majority of Americans feel their taxes are too high (No surprise there – Phil seldom hears from constituents who think they aren’t paying enough in taxes and want the government to take more from their paychecks). Among the survey’s other findings:

– 83% believe the current federal income tax is complex
– Nearly 60% believe they pay too high an amount in federal income tax
– 87% believe the federal tax system needs major changes or a complete overhaul

The last number is particularly telling. Nearly 9 in 10 Americans believe major change is needed to fix our tax system. Phil agrees, which is why he supports the Fair Tax. To learn more about this fundamental reform to our tax system, click HERE.

The Small Business Administration’s Disaster Loan deadline is rapidly approaching. Georgia businesses requesting disaster loans must file by April 23, 2007.  The SBA can provide loans for businesses in the event of a disaster, from economic injury loans to personal property loans. To learn more, visit the SBA’s Disaster Loan website HERE. �

The Republican Study Committee, a group of House conservatives of which Phil is a member, today pointed out yet another example of the Democrats’ failed fiscal responsibility. In a vote on the House floor today, the Democrats will waive House rules that prevent deficit spending:

For years [Democrats] campaigned on it, for months they preached it – pay as you go (PAYGO) rule changes were going to solve everybody’s problems.  Speaker Nancy Pelosi: “After years of historic deficits, this new Congress will commit itself to a higher standard: pay as you go, no new deficit spending. Our new America will provide unlimited opportunity for future generations, not burden them with mountains of debt.”

But that was then. Now, Dems will waive PAYGO.

The new D.C. voting bill would increase mandatory spending…  by about $2.5 million over the FY2008-FY2017 period.  Thus, the Democrat bill violates House Rule XXI, Section 10 (since it would increase the deficit without offset during the periods stated in House Rule XXI). 

Click HERE for more information.

The Marietta Daily Journal today ran an op-ed from Phil critical of our current tax system:

Ronald Reagan once quipped, “The current tax code is a daily mugging.” Come April, that mugging feels more like armed robbery at the hands of the IRS… You might be surprised to learn that Georgians will work from Jan. 1 through April 22 this year just to cover their share of taxes. That’s right: According to the Tax Foundation, it takes us 112 days of income to pay off our local, state and federal tax burden. Three and a half months’ salary is simply too much to pay in taxes. To change this, we need continued tax relief for our citizens and fundamental tax reform for our nation.

Phil makes the case for fundamental tax reform by explaining:

The unfortunate reality is these efforts [to lower taxes] can be easily undone by congressional majorities more interested in big government than small taxes. Nowhere is this more obvious than in the current U.S. House of Representatives.

After campaigning on fiscal responsibility, the Democratic leadership has already passed the largest tax increase in American history. Their 2008 Budget Resolution would raise taxes nearly $400 billion over five years, slapping Georgia workers with a $2,700 tax increase per person in 2011. One thing is clear: protecting our paychecks is not a priority for the new Democrat majority.

Only by fundamentally reforming our tax system can we safeguard our incomes from the whims of a tax-happy Congress.

Phil then describes a “fairer” way of taxing – the Fair Tax:

While I strongly support legislation to lower taxes, I am also working to completely change the system by enacting the Fair Tax. This plan, long championed by Georgia Congressman John Linder, would stop taxing what we make, and start taxing what we spend.

The Fair Tax does away with the IRS altogether, and creates a national consumption tax in its place. This would drastically reduce taxes on lower- and middle- income families, and encourage innovation and economic growth… Under our current system, the harder you work, the more you’re taxed. We actually penalize success. Conversely, under the Fair Tax, the items you purchase - not the income you make - determines your tax bill each year.

To read the complete article, click HERE.

Today, the U.S. House of Representatives will be voting on the Democrats’ 2008 budget - a budget that represents the largest tax increase in American history. It raises taxes $400 billion over five years! It increases the marriage penalty. It cuts the child tax credit in half. It represents a tax-and-spend mentality, and it is bad legislation. As a fiscal conservative, I won’t be supporting the Democrats’ budget.

Georgia taxpayers are going to bear the burden of this irresponsible bill.  The Budget Committee estimates that Georgia’s taxpayers will see their taxes rise an average of $2,700.  That means a family of four with $60,000 a year in earnings would see their taxes rise 61% in 2011, and an elderly couple with an income of $40,000 would see their tax bill nearly triple that same year.

I have a message for the Democrats: our families shouldn’t bear the burden of a growing federal government.  Americans should get to keep more of their hard-earned money, not turn it over to federal programs riddled with waste and abuse.  If you want to learn more about what conservatives in Congress are doing to reinstate responsible spending, click HERE (my website) and HERE (Republican Study Committee) for information on the Taxpayer Bill of Rights. I am proud to support this effort.

Let me leave you with a very telling fact. The last time Democrats were in control of the U.S. House of Representatives – that would be from 1993 to 1994 – they passed what at the time was the largest tax increase in American history.  Well, it looks like the Democrats are trying to top themselves this year with an even larger tax hike, and Georgians have every right to be outraged.

Last week, Phil and other fiscally responsible Members of Congress rolled out the American Taxpayer Bill of Rights – a pledge to taxpayers across this nation that our federal government will stay accountable to those who foot its bills. To learn more about this initiative, click HERE.  In today’s Wall Street Journal (subscription required), Congressman Jeb Hensarling (R-TX) very poignantly lays out the purpose of this Bill of Rights:

Four simple principles. For those who believe Washington spends too much, we agree. For those who believe Washington still taxes too much, we agree. For those who believe we must balance the budget, cut wasteful Washington spending and provide further, permanent tax relief, we agree. And so we pledge to do it better and get it right…. Our leaders must never forget that tax money belongs to the taxpayers, not the government.

Rep. Hensarling is Chairman of the Republican Study Committee, a caucus of conservative House members who are working to keep taxes low and protect our traditional family values. Phil is a proud member of the RSC.

President Bush released his FY2008 Budget request today, saying the plan would balance the budget by 2012. The Office of Management and Budget has links to the priorities in each section of the budget. Click HERE to read the budget overview, HERE to read about funding for the War on Terror, HERE to read about healthcare funding, and HERE to read about budget discipline.  For more 2008 budget priorities, click HERE.

The White House today released a booklet entitled “The State of the Economy”.  A PDF version of the document can be found HERE, or click HERE to link to the White House website for more details.  The booklet examines the strength of our economy, with sections on jobs, wages, taxes, trade, competitiveness and families.

Did you know that for the Democrat leadership to raise your taxes, they don’t even have to win a vote on the House floor. In fact, all they have to do is… nothing.  Unless Congress takes action soon, critical tax relief passed by the Republican majority to help Georgia families and small businesses will expire – and a tax increase will automatically occur.

I strongly support making permanent the successful tax relief passed by the Republican-led Congress. By increasing the child tax credit, delivering marriage penalty relief, and lowering overall tax rates, we have kept our economy strong and growing.

Below is a list of some of the ways your family could be affected if the Democrats let these provisions expire. It’s not a pretty picture (thanks to the Republican Study Committee for these figures)

In 2009, the marriage penalty would be reinstated.

In 2010, the child tax credit will decrease from $1,000 to $500. Also, the small business expensing cap will decrease from $100,000 to $25,000, and the definition of a small business will decrease from $400,000 to $200,000 – raising taxes on our small businesses.

In 2011, things start getting really ugly for the American taxpayer. The marginal income tax rates will increase as follows: 35% bracket will increase to 39.6%; 33% bracket will increase to 36%; 28% bracket will increase to 31%; 25% bracket will increase to 28%; 10% bracket will increase to 15%. The personal capital gains rate will increase from 15% and 0% to 20% and 10%. Dividends will no longer be taxed at the personal capital gains rates, thereby increasing the double taxation of dividends by as much as 62%. The annual education IRA contribution limit will decrease from $2,000 to $500.

Since I began representing the 11th District of Georgia four years ago, I have never once had a constituent come up to me and say, “Gosh, Congressman, can you get the folks in Washington to raise my taxes? I’m just not paying enough of my hard-earned money to the federal government.”  It is shameful that the Democrats plan to let this tax relief expire, thereby raising our taxes and harming our economy.  I won’t give them a pass on this issue, and neither should you.

Tonight, President Bush delivered his annual State of the Union address. To read a transcript of his speech, click HERE.

Here are Phil’s responses to some of the President’s goals:

BI-PARTISANSHIP:
“I am extremely pleased President Bush framed his domestic policy initiatives in terms of choice and innovation, not expanded government bureaucracy.  The American people expect the new Democrat majority to address these problems the right way.  Our citizens don’t want socialized medicine or kid gloves for terrorists. We in Congress need to heed this message.”

HEALTHCARE:
“As a physician, I agree we should give individuals greater control over their healthcare decisions, rather than relying on employers and bureaucratic federal programs.  Concerns over health coverage shouldn’t stop someone from switching jobs or starting a new business, but it often does. Increasing choice and competition in our healthcare system will drive down costs and move us away from the current “big government” mindset.”

IMMIGRATION:
“I am concerned the President’s guest worker program amounts to amnesty for illegal immigrants. The state of Georgia has felt the full impact of illegal immigration on our healthcare, education and social welfare systems, and amnesty would only exacerbate these problems.”

IRAQ:
“On Iraq, the President reminded us that our efforts are directly linked to the larger global War on Terror.  He is absolutely right, and it is a connection that is too often forgotten. Simply put, Congress has a solemn responsibility to give our government and military the right tools to protect us from radical terrorists bent on destroying our nation. The President has a plan for victory in Iraq, and Congress shouldn’t tie one hand behind his back as he’s preparing to deliver the knock-out punch.  Success is far more important than kowtowing to political pressure to abandon our mission.”

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