Mr. Thomas Oatway makes a number of inaccurate assertions in his letter published on Oct. 21. One is spectacularly wrong and because it concerns a theme your left-leaning columnists have adopted, I thought it a good idea to respond.
That is the claim that Donald Trump’s 2017 tax cuts resulted in a “whopper of a revenue shortfall,” and arguing for an increase in tax rates, especially on corporations. None of these assertions are true.
As the Congressional Budge Office recently informed those who bothered to read its report, in the 2021 fiscal year ended Sept. 30 federal tax collections were $4.047 trillion (with a T), and corporate tax collections increased 75% as the economy reopened.
In June 2017, (before the Trump tax cuts were passed) the CBO projected that the government would collect $4.011 trillion in revenue in 2021.So in the most recent fiscal year, the government raised $36 billion more than was expected before the Trump tax cuts were passed. Simply put, there was no revenue shortfall, and tax collections exceed pre-tax-cut projections.
There has been a persistent argument dating back to John F. Kennedy’s tax cuts, continuing through the Ronald Reagan tax cuts and now the Trump tax cuts. The proponents of tax cuts have asserted that they increase economic activity, reduce tax avoidance activity, and actually result in an increase in tax revenue. This occurred with each of these cuts — economic activity increased, there was less reason to engage in avoidance activities and tax revenues increased.
The Oatway side of the argument is that the cuts decrease tax collections, ignoring the effect of higher taxes on the economy and avoidance activity, and result in lower tax revenue.
Mr. Jim de Bree wrote an article on the Democrat proposal to have banks report on their depositors, in which he asserted that the purpose was to uncover tax avoidance. As he must know, tax avoidance is perfectly legal, as the courts have repeatedly held, as it simply means organizing your activities so as to minimize your taxes. If the purpose of this proposal was to uncover tax avoidance then it seeks to examine legal conduct by taxpayers.
However, Mr. de Bree asserts that it seeks to discover underreporting of income, which if intentional is tax evasion, which is not legal. As Mr. de Bree notes, the proposed limit applies based on the total of monthly deposits and withdrawals.
The initial amount of $600 would have unquestionably reported on almost literally everyone in Santa Clarita, while the $10,000 also will drag in most SCV residents.