| ABC's George Will on Yacht Tax's Failure |
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Source: This Week with George Stephanopoulos
Date: Sunday January 12, 2003
Headline: George Will Commentary on Taxes
[Begin Transcript]
George Will: [C]ritics say the President's tax proposals favor the rich at the expense of ordinary people. Maybe. Maybe not. But a recent event reminded us of the perils of taxing the rich to help common folks.
(Voice Over) Twelve days ago the luxury tax on expensive cars expired. It was the last of the luxury taxes that the first President Bush signed in 1990 as part of the budget agreement in which he broke his read my lips no new taxes pledge. The agreement was brokered by this Senator, George Mitchell of Maine, then Majority Leader, and the luxury tax was supported by this Senator, Ted Kennedy from Massachusetts. The luxury tax applied not just to cars but to jewelry, furs and private planes and to expensive boats, yachts. Congress estimated that in 1991 these luxury taxes would rake in $31 million, but the actual sum is just $16.6 million.
Graphics: Luxury Taxes
> Estimated Collection $31 million
> Actual $16.6 million
(Off Camera) Why? Because to the surprise of no one except tax raising politicians, the luxury taxes caused people to buy less jewelry and fewer expensive cars, planes and especially yachts. The tax destroyed jobs, an estimated 25,000 of them in the boat-building industry, much of which is in New England in Senator Mitchell's Maine and Kennedy's Massachusetts. The job losses cost the government more than $24 million in unemployment benefits and lost income tax revenue so the luxury tax actually cost the government money.
Graphics: Government's Cost
> Job losses $24 million in unemployment benefits and lost income tax revenue
(Off Camera) New England's boat-building industry was so devastated that by 1999 another Kennedy, Ted's son Patrick, a Rhode Island Congressman, actually proposed a Federal subsidy to help rich people buy yachts. He called it, quote, "exactly the opposite of a luxury tax." Remember this costly farce when you hear talk about helping the common folks by taxing the rich.
[End Transcript] |
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