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ALERT – Democrats Eliminate Middle Class Tax Relief to Let Welfare Recipients Double Dip

June 26, 2009

June 26, 2009

The current version of the Democrats’ National Energy Tax Bill (H.R. 2998) eliminated middle class tax relief provisions, denying relief from higher energy bills to millions of middle class taxpayers. 

As the bill is written, every family of four earning over $33,000 “loses” – getting no energy stamps but all the energy tax hikes in the Democrats’ bill.  How is that possible?

Instead of helping middle class families, buried in the Democrats’ 300 pages of new legislative text is a provision that affects the Earned Income Tax Credit for childless individuals.  This new Democrat policy doubles the size of EITC payments to childless adults to almost $1,000 per person per year, payable to those earning under about $20,000 per year.
The text of the proposed change on page 260 of the Waxman amendment suggests this expanded EITC payment will assist only individuals who experience a “reduction in purchasing power” caused by Democrats’ National Energy Tax.  Thus Democrats are relieving the poor – and just the poor, not the middle class – of the harm caused by their tax hikes.  Outrageous, but hardly surprising.

What is surprising is what comes next. 

Page 260 of the Waxman amendment says the “reduction in purchasing power” is to be “determined without regard to this paragraph and section 2201 of the Social Security Act.”  What’s section 2201 of the Social Security Act, you ask?  The massive new $100 billion “Energy Stamps” welfare program Democrats create in H.R. 2998.  That program has the same purpose – to reimburse households “for the estimated loss in their purchasing power.”

This is a classic double dip.  Under H.R. 2998 and the Waxman amendment, poor individuals can have their energy “losses” replaced TWICE, once through Energy Stamps, and a second time through the EITC.  This will make some low-income individuals net winners under the Democrats’ National Energy Tax (to the tune of a collective $25 billion), spreading the wealth in their direction and away from middle class families.