New York — Read his lips: Brand-new taxes.
Barack Obama promises to return personal income taxes to Clinton-era levels, with the top rate rising from 35 percent to 39.6. His agenda — call it “No Tax Hike Left Behind” — boosts levies on capital gains (from 15 percent to 20), dividends (from 15 percent to 20), and death (from 0 percent in 2010 to 45, on estates exceeding $7 million).
These increases among existing taxes would work like brass knuckles on a wobbly economy. Big deal. Obama also proposes brand-new taxes that further threaten to pulverize growth and jobs.
— “I think it is appropriate for us to impose a windfall profits tax on our oil companies,” Obama said May 2 in Charlotte, North Carolina. An Obama adviser told Bloomberg News that this could cost $15 billion annually, based on 2007’s profit levels. Obama has yet to explain how higher taxes encourage oil companies to increase supplies of badly needed energy.
— “What we ought to tax is dirty energy, like coal and, to a lesser extent, natural gas,” Obama said in last February 19’s San Antonio Express-News. Obama offers few specifics beyond the fact that he taxes even clean-burning, carbon-friendly natural gas.
— “Employers that [sic] do not offer meaningful coverage or make a meaningful contribution to the cost of quality health coverage for their employees will be required to contribute a percentage of payroll toward the costs of the national plan,” Obama’s campaign website states. Obama has been coy about the penalty he would slap on employers who fail to furnish or finance “quality” health coverage. This would be yet another cost that companies struggle to cover.
— Obama’s Patriot Employer Act would give a 1 percent tax credit to companies that, among other things, covered at least 60 percent of employee health premiums, stayed neutral in Big Labor organizing campaigns, and maintained or increased the number of domestic full-time employees versus their overseas counterparts. Obama would fund this credit by taxing international subsidiaries of “non-patriot” U.S. companies at America’s 35 percent corporate rate, not the lower business levies generally charged abroad. Obama seems unimpressed that this country’s exporters hire Americans to help supply the foreign outposts of U.S. corporations.
As the August 17 Washington Post editorialized, “U.S. companies operating abroad already labor under a bigger tax burden than most foreign competitors. Mr. Obama’s suggested fix would make it even harder for them to compete abroad — ultimately hurting workers and others here.”
— Obama also would apply the 6.2 percent payroll tax to incomes above $250,000. This presumably would soak “the rich” who, in turn, would curse Obama between sips of champagne and swings of croquet mallets. In fact, many of these “rich” people are small-business owners who pay individual, not corporate, taxes. Americans for Tax Reform calculates that households that earn more than $250,000 generate 67 percent of small-business profits. Taxing this country’s 26 million small-business owners taxes those who launch companies, build products, deliver services, and employ 42 million Americans.
Obama tries to disguise his tax-hiking ways by peddling his “tax cuts” for 95 percent of Americans. The Tax Foundation estimates that 44 percent of filers would pay zero income taxes under Obama. So, any checks he sends this cohort would be financed by invoicing those who actually mail checks to the IRS.
John McCain captured all of this with bracing clarity at a St. Charles, Missouri rally on Monday.
“After months of campaign-trail eloquence, we finally learned what Senator Obama’s economic goal is,” McCain said. “He wants to ‘spread the wealth around.’ He believes in redistributing wealth, not in policies that grow our economy and create jobs and opportunities for all Americans. Senator Obama is more interested in controlling who gets your piece of the pie than he is in growing the pie.”
John McCain gets it. He should repeat this precise message 1,001 times between now and November 4.