[NTBKtrader]

WASHINGTON, July 8 — An unexpectedly steep rise in tax revenues from corporations and the wealthy is driving down the projected budget deficit this year, even though spending has climbed sharply because of the war in Iraq and the cost of hurricane relief.

On Tuesday, White House officials are expected to announce that the tax receipts will be about $250 billion above last year's levels and that the deficit will be about $100 billion less than what they projected six months ago. The rising tide in tax payments has been building for months, but the increased scale is surprising even seasoned budget analysts and making it easier for both the administration and Congress to finesse the big run-up in spending over the past year.

Tax revenues are climbing twice as fast as the administration predicted in February, so fast that the budget deficit could actually decline this year.

The main reason is a big spike in corporate tax receipts, which have nearly tripled since 2003, as well as what appears to be a big rise in individual taxes on stock market profits and executive bonuses.

link

[DantesPeak]

The surge is real, lead in no small part to corporate profits -especially large energy companies. So it's somewhat ironic there are calls to tax large energy companies more because of high prices(smaller energy cos. with political friends still get generous tax beraks) - while there are no calls to increase capital gains taxes due to high prices on homes.

It's amazing to me that increases in marginal personal tax rates were successfully hidden from the public under the guise of a much trumpted one year tax reduction two years ago - to be followed by subseqeunt year tax increases.

You can fool most of the people most of the time, at least in the US, and mostly they will never realize it.

[lutherquick]

It the liquidity of the dollar....
The dollar is going down because there so many of them...

High tax revenues don't equal high income if everything starts to inflate as it is.

[DigitalCubano]

Somewhere, Arthur Laffer is cracking a smile...

[Heineken]

The budget deficit is just the visible, here-and-now tip of the iceberg. What ultimately matters is the national debt---the vast bulk of the iceberg itself---which continues to rise as fast as you can count by thousands, and is now about $8.4 trillion. As the debt and the interest on it continue to multiply, the US financial situation steadily worsens. I don't see any way out of it---do you?

[DantesPeak]

$this->bbcode_second_pass_quote('DigitalCubano', 'S')omewhere, Arthur Laffer is cracking a smile...

[DigitalCubano]

$this->bbcode_second_pass_quote('DantesPeak', 'W')hat is happening seems to be the reverse of what Laffer predicted.

[EnergyHog]

$this->bbcode_second_pass_quote('Heineken', 'T')he budget deficit is just the visible, here-and-now tip of the iceberg. What ultimately matters is the national debt---the vast bulk of the iceberg itself---which continues to rise as fast as you can count by thousands, and is now about $8.4 trillion. As the debt and the interest on it continue to multiply, the US financial situation steadily worsens. I don't see any way out of it---do you?

[rwwff]

$this->bbcode_second_pass_quote('DigitalCubano', 'W')hile the underlying factors are debateable, I think the Supply Side cheerleaders will beat their chest over this news. They will claim the tax cuts they pushed stimulated the economy, resulting in much of this new revenue.

[sdcoyote]

Announcements like this are pure BS.

BushCo has historically deliberately overstated the January estimates figures so that they can claim some sort of "victory" with their revised estimates.

http://nationaljournal.com/members/...dget/011706.htm

The Bush administration held a conference call with reporters last week to say that the 2006 deficit would be $400 billion or more. As the White House hoped, the media dutifully reported that number. But, as it almost certainly did not want, the media also reported that this latest Bush administration budget pronouncement should be treated with doubt, skepticism, and perhaps even outright contempt. The reason is that this president has a well-established history of overstating the deficit early in the year and then taking credit when it turns out to be lower than projected, even if it has done nothing to make that happen...

[gnm]

When you're stuck in a hole.... keep digging!

This is like saying, hey we only screwed our budget to the tune of 300bil, not the 400 we thought we would, we're doing great!

How TF is this good news?



-G

[Pops]

$this->bbcode_second_pass_quote('sdcoyote', 'B')ushCo has historically deliberately overstated the January estimates figures so that they can claim some sort of "victory" with their revised estimates.

[MrBill]

$this->bbcode_second_pass_quote('DigitalCubano', 'S')omewhere, Arthur Laffer is cracking a smile...

[Kingcoal]

$this->bbcode_second_pass_quote('MrBill', '')$this->bbcode_second_pass_quote('DigitalCubano', 'S')omewhere, Arthur Laffer is cracking a smile...

[sdcoyote]

It was quite simple. All that was needed was an unending series of victories over your own memory. "Reality control," they called it; in Newspeak, "doublethink." (1984)


Pops...

Reading that this morning actually sent a chill down my spine.

I think we have stepped over the cliff.

[TnAndy]

$this->bbcode_second_pass_quote('sdcoyote', 'A')nnouncements like this are pure BS.

BushCo has historically deliberately overstated the January estimates figures so that they can claim some sort of "victory" with their revised estimates.