Posted on 09/11/2023 3:25:25 PM PDT by Tolerance Sucks Rocks
Just because the government raises taxes, doesn’t necessarily mean it will raise more revenues. The Biden administration is discovering that the hard way.
In August 2022, President Joe Biden signed the misnamed Inflation Reduction Act into law, which included a new tax on companies’ financial statement income, new IRS funding to increase audits, an excise tax on stock buybacks, and more taxes on natural gas, oil, and coal. To top it off, certain Trump administration business tax cuts simultaneously have been phasing out.
On paper, that adds up to more than $60 billion in tax hikes in 2023.
Yet, as of July 31, tax revenues are down almost $400 billion from the same time last year, representing a 13% drop in tax receipts—even larger after accounting for inflation.
It’s unusual for tax revenues to drop from one year to the next, as it’s happened only eight times since 1960. And only once in that 63-year period—from 2008 to 2009—did revenues fall by more than 7%.
It’s too early to fully account for why tax revenues are down in 2023. However, there are some factors that are clearly at work, even if it’s unclear how much of the drop in tax receipts each factor explains.
The following are five such factors.
1) Slow Economic Growth Economic growth has cooled substantially over the past year and a half, leading to stagnant real incomes, which in turn have diminished income-tax and payroll-tax receipts.
Reduced capital gains taxes may especially be dragging down revenue collection. Stocks fell in 2022, and while most market indices recovered in 2023, dividend payouts and stock buybacks have dropped. Existing home sales have also tanked in 2023.
(Excerpt) Read more at dailysignal.com ...
What kind of moron thinks raising taxes should result in tax revenue increases??
they are wa on the wrong side of the tax curve. Going into recession/depression you HAVE to cut taxes
The same morons who think Biden is fit to serve a second term no matter what.
Laffer is laughing.
“Experts” gobsmacked.
And journalists are clueless, as usual.
Biden Raised Taxes, but Tax Revenues Are Way Down This Year. Here Are 5 Reasons Why.
because we are in an undeclared recession. Heading into a depression.
They can move all the goal posts and change all the definitions they want, but it doesn’t change the outcome.
Two consecutive quarters of negative loss to GDP equals recession.
Tax increases kill economic growth; diminished economic activity means less tax revenue is generated.
Every. Single. Time.
DUH.
The Reagan tax cuts doubled the revenue to the U.S. treasury in the 1980s.
We’re buying less vehicles and houses. So you get less taxes from that.
Exactly.
Unfortunately, that's the kind of moron running our government.
Starve the Feds of revenue unless Trump wins 2024.
My corner store sells 100 candy bars a day at $1 each. They should raise them to $2 each. The owner would make an extra $36,500 a year!
I’ll add a 6th reason revenue is down: in 2021=22, Bitcoin went down 300% and any number of people lost their fannies on it. Since the IRS began demanding to know all crypto transactions, thinking they’d catch people making previously untaxed money, a funny thing happened: all those tax sugarplums turned into tax write-offs, spaced over years ($3K/year until the loss is fully written off).
That adds up. Correction: that subtracts down.
One of the reasons is that Hunter Biden didn’t pay his taxes.
#7
A percentage of people, mainly wealthy retired people, have structured their savings to avoid taxable income.
My wife and I have no earned income. We cost the Treasury money.
Inflation itself usually results in increased revenue.
For example, there is a 12% Federal excise tax on Class 8 trucks. In 2019, a 2019 Peterbilt cost $168,000. In 2023, it cost $193,000.
.gov loves inflation.
Geez. In my entire life NO ONE uses the proper term “tax rates”.
Because the money can and does move to areas with lower tax rates.
If you tax something, you get less of it.
Democrats raise taxes on luxury items - the wealthy stop buying luxury items. Tax revenues go down, companies that make the luxury items go out of business, Democrats wonder why and blame the wealthy as tightwads.
But wait....all those bazillion new jobs...ofhhh...part time and minimum wage...
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