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As we approach the inevitability of the fiscal cliff, taxpayers are understandably concerned. How much more will I have to pay in taxes? Will the the economy worsen? What will the spending cuts mean for my family? What surprises await for personal and business taxes and regulations in 2013?
First, the new taxes. Personal income taxes will be going up for everyone. As reported today by The Right Scoop,
The NY Post has created a chart of what you’ll pay in taxes next year if there is no fiscal cliff deal:
As you can tell, that's not chump change.
Americans are learning more about the "fiscal cliff" approaching at the beginning of next year, when tax rates for families and small businesses are set to spike and new taxes in President Obama's health care spending law take effect. But unless there's real change in Washington, we're also headed for a steep "regulatory cliff" that could compound the damage.
After three years of bureaucratic excess, the Obama administration has been quietly postponing several multibillion-dollar regulations until after the November election. Those delayed rules, together with more than 130 unfinished mandates under the 2010 Dodd-Frank financial law, could significantly increase the regulatory drag on our economy in 2013.
Now that President Obama has been reelected, this massive armada of new regulations is ready to be unleashed against businesses all across America.
The National Federation of Independent Business reports that over 4100 new regulations are set to be enacted on businesses in 2013. NFIB has compiled a list of just the 13 most expensive regulations, that together will cost the economy over $500 BILLION over four years:
National Ambient Air Quality Standards (NAAQS) for Ozone, $360,000,000,000 over 4 years - President Obama’s Letter to Speaker of the House Boehner, August 30, 2011
Boiler MACT, $9,500,000,000 capital cost and $11,600,000,000 over 4 years - Office of Management and Budget, “National Emission Standards for Hazardous Air Pollutants for Major Sources: Industrial, Commercial,
and Institutional Boilers and Process Heaters; Proposed Reconsideration,” accessed 6/26/12
Cross State Air Pollution Rule, $3,200,000,000 over 4 years - EPA, “Cross-State Air Pollution Rule,” accessed 6/26/12
Federal Motor Vehicle Safety Standard No. 111, Rearview mirrors, $10,800,000,000 over 4 years - Federal Register, “Federal Motor Vehicle Safety Standard, Rearview Mirrors; Federal Motor Vehicle Safety Standard, Low-Speed Vehicles
Phase-In Reporting Requirements,” accessed 6/26/12
National Ambient Air Quality Standards (NAAQS) for Particulate Matter, $1,560,000,000 over 4 years - http://www.epa.gov/ttn/ecas/regdata/RIAs/PMRIACombinedFile_Bookmarked.pdf
Florida Numeric Nutrient Standards (Phase 2), $100,000,000 over 4 years - Congressional Research Service, 4/25/12, “EPA Regulations: Too Much, Too Little, or On Track,” by James McCarthy
Clean Water Act Jurisdictional Guidance and Rulemaking, $684,000,000 over 4 years - EPA, “Potential Economic Impacts and Benefits Associated with Guidance Clarifying the Scope of the Clean Water Act,” accessed 6/26/12
Non-Hazardous Solid Waste Rule (Reconsideration), $706,000,000 capital cost, $1,120,000,000 over 4 years - Office of Management and Budget, Standards of Performance for New Stationary Sources and Emission Guidelines for Existing Sources:
Commercial and Industrial Solid Waste Incineration Units; Reconsideration and Proposed Amendments , accessed 6/26/12
Tier 3 Pollution Motor Vehicle Emission and Fuel Standards, $17,000,000,000 capital cost, $52,000,000,000 over 4 years - API, July 2011, “Potential Supply and Cost Impacts of Lower Sulfur, Lower RVP of Gasoline,” pg 56
Uniform Standard for Stationary Sources (Flare Rule), $460,000,000 capital cost, $384,000,000 over 4 years - EPA notice of submitting rule for publication to Federal Register on 6/1/12, pg 17, accessed 6/26/12
Utility MACT, $38,400,000,000 over 4 years - Office of Management and Budget, “National Emission Standards for Hazardous Air Pollutants From Coal- and Oil-Fired Electric Utility
Steam Generating Units and Standards of Performance for Electric Utility Steam Generating Units ,” Accessed 6/26/12
Cooling Water Intake Structures, $1,596,000,000 over 4 years - EPA, Criteria and Standards for Cooling Water Intake Structures, accessed 6/26/12)
Coal Combustion Residuals Generated by Electric Utilities, $5,896,000,000 over 4 years - EPA, “Hazardous and Solid Waste Management System: Identification and Listing of Special Wastes; Disposal of Coal Combustion Residuals
from Electric Utilities,” pg 8, accessed 6/26/12
Total Cost Over Four Years $515,006,000,000.00
If you're so inclined, you can amuse yourself with the absurdities of the full list of new regulations here. One wonders what possible need exists for the federal government to regulate, for instance, endangered and threatened wildlife and plants in the manatee refuge in Citrus County, Florida; or to create a mandate for all new cars to have rear view cameras; or why so many new ozone regulations are being written when it's been known for at least a decade that the ozone layer has been stabilized.
So, not only are taxes going up for individuals and businesses under the Sequestration Bill; not only are new taxes being implemented under Obamacare (that medical device tax is really gonna do wonders for the economy, eh?); but we have yet another drag on our economic engine in the form of new regulations costing businesses exorbitant amounts of capital misallocated towards compliance instead of growth.
If economic indicators are correct and history repeats, it appears that 2013 will be one of the most difficult in recent memory. Hope for a robust economy has changed to decreased expectations.