Time for tax cuts
By David Vitter -
May 25, 2006
Louisiana families tell me time and again about their hard work to make ends meet. Between paying for groceries, gasoline for our cars and trucks and energy costs to cool our homes, itís hard for many families to find enough each month to pay the bills, much less try to help kids through school or think about putting some away for a rainy day. Saving is difficult when taxes are high, but luckily tax relief is on its way for every income tax payer, and that means more money in the pockets of Louisiana families. Congress recently passed the Tax Increase Prevention and Reconciliation Act, which will keep our taxes low and keep the economy growing.
I believe that cutting taxes isnít giving away the federal governmentís money, itís letting families keep the money theyíve earned. Over the past five years, since our pro-growth policies were first passed into law, weíve proven that letting hard-working Americans keep more of their money isnít just the right thing to do, but the economically smart thing to do because tax cuts have stimulated the economy and job growth.
This latest tax relief will a help to all families because the per-child tax credit was doubled to $1,000, helping more than 400,000 parents in Louisiana. Hard working lower-income families will benefit from the bottom rate of federal income tax reduction from 15 percent to a 10 percent bracket. This single provision benefits more than 1 million Louisiana families.
Middle-class families squeezed by high gas prices and credit card debt will benefit from this tax relief with a reduced marriage tax. Along with many Louisiana families, I agree that the tax structure should be fair and not penalize people for making good choices like getting married and raising a family. This measure will help nearly 400,000 married couples in Louisiana keep more of their tax dollars in their pockets.
The tax cuts on dividends and capital gains help both families and businesses. By cutting these taxes, Louisianians who own mutual funds, IRAs and 401(k) retirement plans will benefit. These tax cuts have succeeded in lowering the cost of capital and encouraging businesses to expand and hire new workers.
Our passage of the Tax Increase Prevention and Reconciliation Act was important because it prevents a huge tax increase and extends the important tax cuts originally made in 2001 and 2003. These types of tax relief measures are important to families, but also to the economy as a whole.
When we passed these pro-growth policies in August 2003, we created more than 5.2 million jobs to date. Our economy grew at a remarkable 4.8 percent rate last quarter, and unemployment is down to 4.7 percent, which is lower than the average of the last four decades. Productivity over the last five years has grown at the fastest rate in decades, and higher productivity leads to higher wages.
But these are more than statistics. They are real results for real Americans. New jobs, higher incomes and a growing stock market means that more Louisiana families can afford to buy their own homes, pay down their debt, put their kids through college and plan for their retirements.
Our economy is strong, but we must fight to keep it strong. I am interested in hearing your thoughts on how we can help more Louisiana families keep more of their hard-earned money.