National Sign-On Letter in Support of the Tax Hike Prevention and Business Certainty Act
TO THE MEMBERS OF THE UNITED STATES CONGRESS:
The undersigned trade associations representing thousands of businesses across the nation strongly urge you to cosponsor and support S. 1647 and H.R. 3091, “The Tax Hike Prevention & Business Certainty Act”, introduced by Sen. Crapo and Rep. Roskam, which would maintain the top capital gains and dividends tax rates at 15 percent and prevent a massive tax increase that would have detrimental impacts on investment and jobs in the United States.
Unless Congress acts by the end of 2012, the tax rate for capital gains will increase from 15 percent to 20 percent and the dividend tax rate will more than double from 15 percent to 39.6 percent. In addition, beginning in 2013 investment income will be subject to an additional Medicare Hospital Insurance (HI) tax of 3.8 percent, raising the top rate on capital gains to 23.8 percent and on dividend income to 43.4 percent, resulting in one of the largest tax increases in U.S. history.
A tax increase of this size will have significant impact, which includes discouraging capital investment needed for economic growth and job creation, incentivizing companies to use excessive debt financing and potentially reducing the value of dividend-paying stocks. Any of these outcomes would hurt Americans at all income levels, and especially retirees, many of whom rely on investment income as a supplement to their retirement.
This looming tax increase presents businesses and individuals with uncertainty and great complexity in the short-term. Looking ahead, comprehensive fundamental tax reform could result in giving taxpayers more certainty, simplicity, and fairness, while encouraging economic growth and job creation. In the interim, Congress must act to maintain the current tax rates on capital gains and dividend income and give businesses and individual investors the certainty that they need to support economic growth and job creation.
It is imperative Congress enact legislation that would maintain the top capital gains and dividend tax rates at 15 percent and remove the uncertainty surrounding this impending tax increase. We strongly support these bills and urge you to cosponsor and support S. 1647 and H.R. 3091, “The Tax Hike Prevention & Business Certainty Act.”