It’s hard to believe that the Democrats are planning to increase taxes in 2023, during what is being called the worst macroeconomic conditions in 40 years. This comes at a time when inflation is at its highest since 1981, and stock-bond-equity losses have been greater than any other year since 1871.
The tax increases proposed by the Democrats would come with a host of problems for American businesses and taxpayers alike. The most immediate issue is that businesses will be hit with higher taxes, reducing their ability to invest capital back into their operations and workforce. The increased taxes also mean taxpayers will pay more money to support government programs they may not even benefit from.
This decision doesn’t just affect businesses and individuals; it could have negative consequences on the entire nation’s fiscal health as well.
Raising taxes on businesses could lead to job losses across the economy which would further damage our fragile recovery from the pandemic recession. Additionally, increasing taxes means less disposable income for individuals who rely on it to cover everyday expenses like rent or groceries – meaning an increase in poverty rates nationwide.
What makes this situation even worse is that these tax increases come at a time when interest rates are hovering around zero percent, making it increasingly difficult for businesses and individuals alike to access much-needed credit or loans from financial institutions at reasonable terms – exacerbating economic hardship already caused by Covid-19 shutdowns across much of the country.
So why are Democrats moving forward with these proposals? They claim that these measures will help fund necessary government programs like healthcare reform but many economists disagree with this assessment claiming that there are better ways to raise revenue without hitting taxpayers so hard in their wallets.
The Daily Mail reported:
“Democrats claimed the Inflation Reduction Act would help ordinary Americans, but a new analysis suggests people making less than $400,000 a year could end up paying $20 billion of the new tax revenue it brings in.
President Joe Biden signed the act into law in August, injecting $473 billion of new spending on climate and healthcare, yet there are strong concerns it will do little to reduce inflation.
In fact, middle-class Americans will pay new taxes – directly contradicting Biden’s promise to not raise penalties on people earning under $400,000.
Republicans continue to criticize the bill, claiming it will lead to taxes on ordinary Americans and do little to help reduce soaring costs.”
At a time when our economy needs all of the help it can get, raising taxes is certainly not going to do us any favors – rather it could cause more harm than good if we don’t take steps now to mitigate its effects while finding alternative sources of funding for essential government services.
Erica Carlin is an independent journalist, opinion writer and contributor to several news and opinion sources. She is based in Georgia.