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Issues

Tax Relief

Tax Relief

Congressman Souder's Position

The American people are laboring under a crushing tax burden. In 2006, Tax Freedom Day, the day on which people stop working to support the government and start working to support themselves, fell on April 26. This is three days later than in 2005 and ten days later than in 2003 and 2004. This is not right. I believe that people should keep as much of their income as possible. Individuals are far more suited than the government to meet their own needs. To that end, I support every effort to keep taxes low for both business and individuals.

Despite partisan rhetoric that tax cuts drain the government of funding, reality shows a different picture. Cuts in capital gains taxes and taxes on dividends have actually brought in more revenue. Unfortunately, many politicians refuse to acknowledge this fact, and continue to push for higher taxes. Raising taxes is a sure way to stop business expansion, dampen consumer spending, and actually shrink government revenue.

Since 2001, Congress has cut taxes on income, dividends, capital gains, inheritances, and married couples. We have also increased the child tax credit. Regrettably, these tax cuts are set to expire at varying intervals. This means that at some point, unless Congress acts, your taxes will likely increase. It also means that it difficult to make long-term financial plans because there is no certainty in what the future tax law will be. While I have voted to extend many of these tax cuts, I would prefer making them permanent.

As much as taxes burden the American people, compliance with the tax code is also a burden. The IRS estimates Americans spend 6.6 billion hours per year filling out tax forms. In 2002 Americans spent roughly $194 billion dollars on tax compliance. I believe this is too much. I have long supported a modified flat tax as a way to simplify the tax code. I believe a flat tax – with mortgage and charitable deductions, is the best way to keep taxes low and simple.