WASHINGTON, D.C.- December 15, 2010 - U.S. Senator Olympia J. Snowe (R-Maine) released the following statement after voting in support of final passage of H.R. 4853, the Middle Class Tax Relief Act of 2010, to extend current tax law for two years:
"For far too long, the possibility of Washington increasing taxes on all Americans has inhibited our potential for economic growth at a time when we can least afford it. The passage of this two-year extension of current law - while not perfect - will protect Americans' hard-earned paychecks and provide necessary certainty in federal tax policy so that job creators and families can make appropriate decisions about taking risks, investing in the future, planning their budgets, and putting more people back to work.
"The benefit of this legislation to the health of our nation's economy, and to our small business owners responsible for 65 percent of new job creation, is undeniable. At a time when 6.3 million Americans have been jobless for over 27 weeks, prominent economists estimate increasing the top two individual tax rates from 33 to 35 percent and 36 to 39.6 percent on small business and high income earners would reduce the nation's Gross Domestic Product by 0.4 percent in 2011 and kill 770,000 jobs by 2012. Moreover, increasing the 10 percent rate to 15 percent is a 50 percent tax increase on low income individuals that would devastate families and those who depend on this low rate to keep enough of their earnings to pay rent, purchase groceries, and keep their cars on the road.
"Congress now has an imperative to address the complicated and outdated tax code to ensure global economic competitiveness for the long-term and balance federal revenues with spending commitments. When the 2001 tax cuts were authored, our country was projected to have a $4.2 trillion budget surplus through 2009, and I strongly advocated a trigger mechanism to force reevaluation of tax policy as fiscal conditions changed. Recent forecasts estimate a deficit of over one trillion dollars for next year alone, so it is critical that Congress commit to returning to an orderly budget process and comprehensive tax reform.
"As a senior member of the Senate Finance Committee, which will be charged with addressing a tax code so horribly complex that taxpayers spent $140 billion in 2008 alone trying to decipher their returns, I look forward to reestablishing a pro-growth and sustainable tax code, ending wasteful government subsidies - such as the ethanol tax credit - and meeting our nation's investment priorities without subjecting our children and grandchildren to continued deficit spending."
Senator Olympia Snowe