"Democrats are kind of falling over each other seeing who can raise taxes faster. It looks like they're going to raise taxes anywhere between 20 to 30 percent."
Rudy Giuliani on Monday, July 30th, 2007 in a speech in Laconia, New Hampshire.
Playing fast and loose with numbers
But it doesn't really matter, especially since so many in the Democratic field of candidates are in the Senate or the House. Either way, Giuliani is correct that Democrats are open to letting some of the tax cuts of 2001 expire, which would raise taxes for those affected.
Most of the Democratic presidential candidates have said they want to renew some of the those tax cuts, which are scheduled to expire in 2010. But they also have indicated that they would favor allowing tax cuts to expire that, in their view, unfairly benefit wealthy Americans. The tax rate on household incomes above $200,000 would return to higher levels, as would taxes on capital gains, dividends and estates.
But is that a 20 to 30 percent increase?
To defend his claim, the Giuliani campaign points to a Congressional Budget Office report that shows a 31 percent rise in revenue from 2006 to 2011 if all of the tax cuts are allowed to expire.
There are two problems with this. First of all, the Democrats aren't advocating the elimination of all of the 2001 tax cuts. And second, the logic of the Giuliani argument is that a rise in revenues is the same as a tax increase.
If that's the standard, than President Bush's own budget for 2008, released in February, includes a 29 percent tax increase over the same period, too.
Nope, that doesn't cut it.
Published: Monday, August 6th, 2007 at 12:00 a.m.
Sources:Selected Provisions of Major Tax Legislation from 1981 to 2006
Los Angeles Times, "Edwards announces 'tax the rich' plan," July 27, 2007 New York Times, "2008 Democratic Hopefuls Propose a Ceiling on the President's Tax Cuts," April 21, 2007
St. Petersburg Times interview with Richard Kogan, a Senior Fellow at the Center on Budget and Policy Priorities
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