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Largest Tax Increase in History: “$6.7 Trillion in the form of Higher Gasoline and Electricity Bills”
June 5, 2008

Largest Tax Increase in History

“$6.7 Trillion in the form of Higher Gasoline and Electricity Bills” 

 ·        The Congressional Budget Office (CBO) says the Climate Tax bill would effectively raise taxes on Americans by over a trillion dollars just over the next 10 years.  

·        Sponsors of the bill and its substitute estimate it will generate over $6.7 trillion in revenues through 2050 from the sale and auction of carbon allowance to energy users.  

·        Unfortunately, that $6.7 trillion cost will be passed on to families and workers across the country in the form of higher gas prices, higher electricity and heating/cooling bills, more expensive consumer goods and higher workplace costs.  

·        In fact, new funding for government programs, minus any set asides for transition assistance or tax relief to states, industry, or consumers under the Act is a staggering $4.2 trillion.  

·        In my state of Oklahoma, according to various economic models, this bill will cost $3,298 to Oklahoma families in 2020 and cut over 51,000 jobs through the life of the bill. 

·        Carbon caps will have an especially harmful impact on low-income Americans and those with fixed incomes.  

·        A recent CBO report found: "Most of the cost of meeting a cap on CO2 emissions would be borne by consumers, who would face persistently higher prices for products such as electricity and gasoline. 

·        Those price increases would be regressive in that poorer households would bear a larger burden relative to their income than wealthier households."  

·        The poor already face energy costs as a much higher percentage of their income than wealthier Americans. While most Americans spend about 4% of their monthly budget on heating their homes or other energy needs, the poorest fifth of Americans spend 19%.  

·        A 2006 survey of Colorado homeless families with children found that high energy bills were cited as one of the two main reasons they became homeless.  

·        In March, Roy Innis, chairman of the Congress of Racial Equality, warned that mandated carbon controls would disproportionately impact minorities. "We are harming our poorest families; we are rolling back the civil rights we struggled so long and hard to achieve; and we are sending many minorities to the back of the energy and economic bus. This must not, and cannot continue," Innis said.

·        One thing is certain: the full brunt of the new taxes in this bill will be born by American consumers.  As CBO says, “most of that cost would ultimately be passed on to consumers in the form of higher prices for energy and energy-intensive goods and services.”  

·        The Wall Street Journal said on May 27 that the bill “would impose the most extensive government reorganization of the American economy since the 1930s.”  

·        The Cleveland Plain Dealer said the bill “will just bore new holes into an already battered economy. It also doesn't have a prayer of becoming law.”  

·        A June 2, Wall Street Journal further opined: “This is easily the largest income redistribution scheme since the income tax.”  

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