According to President Obama’s tax proposals, if you make $250,000 or more, your tax rate will rise from 33% to 36% and your tax deductions, including for charitable giving and for home mortages, will drop from 38.9% to 28% as a reduction in your taxable income.
This could have a devastating effect on charitable giving, including donations to churches.
Furthermore, because of these big tax hits, people are going to watch their income, lest they hit the $250,000 threshold. And if you want economic growth, the last thing you should do is inhibit people from making money.
To make it worse, this is exactly the range of income common to small businesses that contribute most to the nation’s employment. If you are a small business owner bringing in, with your spouse’s salary, somewhat less than $250,000, are you going to expand your business (which usually involves hiring more people) if it will put you over the threshold?
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