[Congressional Record (Bound Edition), Volume 154 (2008), Part 13]
[Senate]
[Page 18668]
[From the U.S. Government Publishing Office, www.gpo.gov]




                               TAX POLICY

  Mr. GRASSLEY. Mr. President, after I spoke about small business tax 
issues yesterday, Senators Sanders and Durbin responded. I would like 
to thank my friends from Vermont and Illinois for engaging in the 
important debate of the future of tax policy for our country last 
night. The upcoming congressional and Presidential elections will have 
a big impact on tax issues, so these issues should be debated here in 
the world's most deliberative body. In response to the comments of my 
friends from Vermont and Illinois, I would like to raise a few brief 
points.
  First, the 2001 and 2003 tax relief bills were not and are not the 
``Bush tax cuts.'' These bills were crafted in a bipartisan manner. In 
fact, one-fourth of the Democratic Caucus voted for the 2001 tax 
relief.
  I will be discussing middle income tax relief in a separate speech 
shortly. However, there's no question the legislation criticized by my 
two friends improved the progressivity of the Tax Code and cut taxes 
for middle income families. For a single mom with two children and 
$30,000 of income, the 2001 and 2003 tax relief has prevented a tax 
increase of $1,100 per year. Similarly, for a family of four with 
$50,000 of income, this tax relief has prevented them from facing a 
$2,300 yearly tax increase.
  Indeed, both Senator Obama and Senator McCain agree on keeping most 
of the structure of the legislation criticized by my friends from 
Vermont and Illinois.
  Where Senators Obama and McCain disagree is on whether we should keep 
the tax rates where they are. I would note that Senator Obama recently 
agreed that, because of concerns about the economy, we should leave the 
top rates where they are, at least for now.
  I would encourage my friends to review the data I presented 
yesterday. That data clearly illustrates that there are negative 
effects on small business from raising marginal rates by 17 percent to 
33 percent. The data show that the tax increases of Senator Obama's 
plan will take direct aim at small business owners. Senator Obama does 
now agree that we should defer his tax increases until 2011. Senator 
McCain thinks the current levels of taxation are appropriate for both 
now and the future.
  The bipartisan tax relief of 2001 and 2003, largely supported by 
Senators Obama and McCain, kept revenues at or above historical 
averages for most of the period they were in effect. These policies 
were put in place during economic shocks, and the economy responded.
  I would ask my friends why they disagree. Why should we raise taxes 
on small business now? I look forward to their response.

                          ____________________