Posted on 05/11/2006 9:42:40 AM PDT by blitzgig
President Bush’s tax cuts—and especially the well-designed supply-side tax cuts of 2003—have helped the economy. In particular, the substantial reduction in the tax rate on dividends and the modest reduction in the tax rate on capital gains have helped investment. A decline in investment had led the recession at the start of Bush’s term, and increased investment has led the current boom.
For a boom is what it is. The economy is growing, jobs are increasing, wages are up, and the stock market is rising. The tax cuts are not responsible for all of this good news, but both common sense and the timing of the recovery suggest that they have played an important role.
Republican leaders have now agreed to extend the capital-gains and dividend tax cuts until the end of 2010. All of Bush’s tax cuts would expire at that time. We would have preferred to make the tax cuts permanent the moment they were enacted. Or at least as permanent as policies ever are: No Congress can prevent a future Congress from raising taxes. The most Congress can do is to prevent taxes from going back up automatically, without a vote. Making the tax cuts permanent would merely increase the probability that tax rates would stay low. Extending them raises that probability, too, but not as much. The extension makes it a little bit easier to make economic plans for the next few years.
But we ought to do more. One of the most valuable of Bush’s tax cuts—the provision to let businesses write off the cost of investment quickly, instead of stretching the write-off over many years—has already expired. It should be reinstated. America taxes corporations relatively heavily. Growth-oriented conservatives should aim to change that.
(Excerpt) Read more at article.nationalreview.com ...
The tax cuts will be nullified as double digit inflation drives people into higher brackets and the AMT.
I'd like someone at NRO to define what the heck a "supply-side tax cut" is.
Though I should point out . . . reducing the number of taxpayers affected by the AMT really has nothing to do with giving people a tax break. The primary aim of this measure is to avoid a collapse that would occur in high-priced real estate markets when AMT taxpayers lose their ability to take deductions for their state and local taxes.
Ah, but in the evil Bush economy there is no wage growth, so we needn't worry about people's incomes being pushed into brackets affected by the AMT.
The tax cuts prior to 2003 were rather ineffective.
I would think that it's self explanatory. Would you like my definition?
ROTFLMAO!!!
The tax cuts will be nullified as double digit inflation drives people into higher brackets and the AMT.
When was the last time we had double digit inflation?
No, it's not.
Would you like my definition?
Sure!
They are tax cuts that promote any combination of investment, business growth, business creation, innovation, or research and development.
Reducing income tax rates is really a "demand side" tax cut.
We agree 100%. Look at my post #6. There's another tax thread today where I say that GWB invented the Keynesian tax cut. He was always saying that his tax cuts were intended to put money in the pockets of consumers so they could go out and spend.
There's no double digit inflation.
Would you consider the dividend tax cut a "supply side" tax cut? I can look at it from different directions and see it either way.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.