“By how much?” you ask. Try $128 billion.
The Heritage foundation has discovered that the president’s budget proposal is chock-full of hidden tax hikes, adding up to a total of $2 trillion in higher taxes.
“In fact, the President wants to raise taxes by $1.689 trillion – that’s $128 billion more than [the $1.56 trillion] reported by the White House Office of Management and Budget (OMB) in the President’s FY 2013 budget proposal,” The Foundry‘s Mike Brownfield writes.
Wait a minute. How can that be? Where are these numbers coming from?
“The Green Book estimates that the President wants to raise taxes by $1.689 trillion,” Dubay writes, “That is $128 billion more than the OMB figure.”
Why did the Treasury Department’s number differ from the OMB’s? Apparently, the OMB stashed tax hikes in areas where they didn’t belong, clearly misleading readers about the actual amount of tax increases.
Which tax hikes were buried deep in the OMB report?
Dubay lists a couple of them:
The biggest missing tax hike from the tax section is the “Financial Crisis Responsibility Fee,” better known as the bank tax. OMB put this tax in the Treasury Department’s section of the table. This tax hike adds another $61 billion to the President’s tax hike total. Also included in the Treasury Department’s section is a $44 billion tax hike from allowing the IRS to adjust a program integrity cap. OMB put a $48 billion increase of the unemployment tax in a footnote of the labour Department’s section and a $1 billion hike of user fees for commercial navigation of inland waterways in the Veterans Affairs’ section (Corps of Engineers). These hidden tax hikes account for the missing $154 billion.
OMB also failed to account for a relatively small amount of tax cuts in its total tax hike figure. Those tax cuts total $26 billion. Subtracting that sum from the $154 billion missing tax hikes figure arrives at the missing $128 billion of net tax hikes OMB misclassified that should be included in President Obama’s total tax hike.
Dubay points out that the president’s budget also takes credit for tax cuts that aren’t new policies, and “therefore wrongly reduce the amount he plans to increase revenue.”
So what does this mean?
“Properly remove that $317 billion of previous tax cuts from the President’s net tax hike as reported by OMB, add the missing $128 billion of tax hikes, and the President actually calls for raising taxes by more than $2 trillion over 10 years. That is 31 per cent more than the OMB figure suggests the President wants to raise taxes,” Dubay explains.
What suggestions are there?
“Congress should disregard the misleading tax hike figure from OMB’s table and use the correct $2 trillion amount when referring to the total tax hikes in the President’s budget,” Dubay writes. “Members of Congress should question OMB as to why they chose to mislead readers about the total tax hike that President Obama has called for on American taxpayers.”
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