Republicans shouldn’t give in to Senate Majority Leader Harry Reid’s demand for more tax increases, according to a Wall Street Journal editorial
Reid staked out his tax stance in an interview with ABC's George Stephanopoulos Sunday. The Nevada Democrat said he and his party colleagues are unwilling to broach spending cuts before another tax hike, adding that a tax increase would be required to ease the massive automatic spending cuts set to begin March 1.
“Republicans would have to be suicidal to agree, all the more so after the tax increases that struck on January 1,” The Journal reports. The fiscal-cliff agreement reached last month imposed higher taxes on individuals with more than $400,000 of annual income.
It will soon become clear how much additional revenue those hikes are bringing in.
“But we already know that revenues were rising smartly at the end of last year, even before the tax increase,” Journal editors write.
Individual income-tax receipts gained 15.6 percent, or a hefty $42 billion, in October-December from the same quarter a year earlier, according to the Congressional Budget Office. Overall receipts climbed almost 11 percent.
“Federal revenues have been at low levels since 2009 because of the historically slow recovery, but they should come back to 18-19 percent of GDP with any kind of normal growth,” the editorial asserts.
“It'd be nice if Harry and the Democrats waited to see, but their tax appetite is voracious.”
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