Toomey Report: Manufacturers Face Job-Killing Tax Hike Under Obama Plan
While excuses continue to be made for President Obama’s dismal record on job creation, it’s more difficult to rationalize a policy that actually drives jobs away.
A report prepared by U.S. Senator Pat Toomey (R-Lehigh) shows that the Administration’s tax policies will undermine the very sector that has the strongest multiplier effect on job growth - manufacturing.
A planned tax increase in 2013 will raise the marginal rates on many manufacturers from 35 percent to 41 percent.
“The plan will hit 80 percent of manufacturers and cost 31,000 jobs,” Toomey told a room full of reporters and business officials at the Pennsylvania Manufacturers’ Association headquarters in Harrisburg on October 15.
The report, ‘Taxing Manufacturing’, shows the depth of the damage the tax will have on manufacturing.
Many manufacturers, set-up as pass-through companies, will be especially hard hit since they pay no corporate income taxes, rather the income is allocated among the owners and the rate is levied on an individual level.
“Businesses put profits back into the businesses to grow and expand,” Toomey said. “This tax is going to kill innovation simply because the money won’t be there to put back.”
Toomey also said the tax will discourage risk taking and weaken our competitive stance with other industrialized nations, all of which have lower overall business tax rates.
“We appreciate Senator Toomey’s efforts on behalf of the manufacturing sector here in Pennsylvania and across America,” said PMA Executive Director David N. Taylor. “Competitiveness in the global economy requires leadership in Washington DC that works to minimize the costs placed on our manufacturers, whether through taxes, regulation, or litigation. President Obama’s tax increases would send the U.S. economy in the opposite direction. If enacted, these higher taxes on manufacturers could plunge the nation back into recession.”