Rehberg Criticizes Past And Future Tax Increases

Statement

Montana's Congressman, Denny Rehberg, today released the following statements on Tax Day, April 15.

"While our economy is struggling to recover and our nation is bleeding jobs, higher taxes are making the problem even worse. Since January of 2009 Congress has increased taxes by $670 billion which is more than $2,100 for each man, woman and child in America. Now is the time to cut taxes to empower consumers and small businesses, but instead Congress has done just the opposite. It's no wonder that unemployment has skyrocketed to around ten percent and has not shown any signs of declining."

Already in 2010 for example, Congress has passed tax increases that impact Americans who do not have government-approved health insurance, people who have "high-cost" health insurance, and those who purchase brand name pharmaceuticals or medical equipment.

"But the tax hammer has yet to fully fall, because unless Congress stops it we're in for the largest tax increase in American history. At Midnight on December 31, the tax relief we passed in 2001 and 2003 expires. Both the rich and the poor will face higher taxes while families and small businesses will be forced to send more of their hard-earned money to Washington, D.C."

Without Congressional action, the following tax increases will occur at the end of the year.

First, the 10 and 15 percent tax brackets will be combined into a 15 percent bracket. The 25 percent rate will increase to 28 percent, the 28 percent rate will increase to 31 percent, the 33 percent rate will increase to 36 percent and the 35 percent rate will increase to 39.6 percent. All taxpayers, from the lowest to the highest incomes, will pay more in taxes.

For married couples, the current standard deduction equal to twice the single taxpayer standard deduction will decrease to only 167 percent of the single standard deduction, restoring the marriage penalty. In tax year 2007, the latest available statistics from the IRS, there were 204,146 jointly-filed tax returns in Montana.

The child tax credit is scheduled to decrease from $1,000 to $500 per child. In tax year 2007 there were 75,979 Montanans who took advantage of the child tax credit.

Capital gains tax rates are currently 15 percent and 5 percent, but will increase to 20 percent and 10 percent. Dividends, now taxed at the capital gains rates for individuals, will now be taxed as regular income, thereby increasing taxes on dividends by as much as 164 percent.

The federal estate tax is eliminated in 2010, but will return in 2011 at the 2001 level of a maximum tax rate of 55 percent with a $1 million exemption without action from Congress.

"We need a tax policy that empowers the American consumer. We do that by letting them keep their hard-earned money, not by passing record tax increases."

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