Thursday, March 5, 2009

Government Soul: Taxing Generosity - 3

The last two days, I've been discussing some of the tax hikes the Obama administration is planning, particularly those aimed at donations to non-profits (and I run a non-profit). What has concerned me most, however is the rhetoric that is geared to gain support from people unfamiliar with the real issues. This not only hurts the soul of our culture but the souls of those playing word games.

Apparently Washington has been reading my blog.... :) ... because this article was found on page 3 of the Wall Street Journal, "White House Rethinks Tax Hikes."

Even congressional members of the Democratic Party are giving resistence, including the top tax writer who is chairman of the Finance Committee. You can read the article for the questions being raised.

Two comments stood out to me. One was by Treasury Secretary, Timothy Geithner when he said the tax proposals "affects only about 1.2% of taxpayers." Yet, that's not the point at all. This is still stuck in political spin. It's not about how many taxpayers are affected, it's about how many non-profits are affected. That 1.2% represent a large part of giving, which Indiana University's Center on Philanthropy, said would have been hit over the last two years with nearly $4B in losses to non-profits. You have to compare apples to apples to see real impacts.

Geithner also said that the tax proposal would only have a "modest negative impact." How does he know? Nobody knows until the taxes are enacted, when government grows and charities shrink.

The other thing that stood out to me represented the real kind of change America has been wanting. It came from Democratic Senator, Maria Cantwell. "Why not look at a broader approach to tax policy, [rather] than coming in with this proposed change to marginal rates?"

Tell it like it is, sister!

THAT is the CHANGE America needs right now. Creativity and real reform, cleaning up the 66,000 pages of tax law we currently have! We do not need some easy slap on tax rate hike that doesn't clean up Washington nor help anyone else. That'll help a lot of souls, including Washington's.
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