Under current law, taxes as a proportion of the national economy will rise sharply in the future, from just over 18 percent of GDP today to a record-breaking 20.9 percent within 18 years and to almost 24 percent before a newborn today reaches early middle age. This scheduled rise threatens the growth of the U.S. economy and the well-being of future generations.
Taxes need to be cut, not raised, and any purported tax reform ideally should reduce taxes; at the very least, taxes should not be further increased.
Proposals now before Congress to “reform” the tax treatment of private equity partnerships would substantially increase taxes. Some estimates put the size of the increase at as much as $100 billion over 10 years for some versions of the legislation.
This tax hike would not only threaten the economy generally but would also jeopardize a particularly important and crucial part of the entrepreneurial economy: capital-intensive firms that take the risk of investing in and restructuring underperforming enterprises and putting them onto a sound footing. But bills by Senators Chuck Grassley (R