December 06,2010

Grassley: Tax Revenue Doesn't Grow on Christmas Trees

Statement of U.S. Senator Chuck Grassley
Ranking Member of the Committee on Finance
Framework of Tax Relief Agreement
Monday, December 6, 2010

“Republicans support tax relief across-the-board, including the middle class, and have fought for it.  The middle class and the unemployed need job-creating policies that expand the economic pie, not shrink it.  Growing the economy expands the tax base.  Jacking up taxes would be a sure-fire way to deep-freeze hiring and kill the fragile economic recovery.  Job-creating small businesses storing up capital have been reluctant to create jobs and take on new payroll obligations, not knowing what their taxes will be in January.  Part of the blame is attributable to the uncertainty over the direction of tax policy.  Tax incentives that create jobs in renewable energy have been expired for a year, with no action, costing jobs.  No wonder unemployment moved higher in November.

“The current leadership is starting to face the reality of last month’s elections.  Americans want Washington to stop overspending and overtaxing.  Contrary to what a lot of Democratic leaders have said, raising taxes is not the magical cure that will shrink the deficit.  Higher taxes give big spenders a license to create new layers of government and put taxpayers on the hook for even more entitlements.  Higher tax rates siphon money out of the private sector and shrink the Gross Domestic Product.

“During the lame-duck session of Congress, arguments have been made that seem to say letting taxpayers keep the same amount of their own money is like handing out ‘bonuses.’  Iowa families who are worried about less take-home pay in January don’t consider preventing a tax increase on them a bonus, a windfall or a handout.  Tax revenue comes from taxpayers’ hard-earned money.  It doesn’t grow on Christmas trees, no matter how fanciful the rhetoric gets about millionaires versus the unemployed.”