Chris Edwards, director of tax policy studies at the Cato Institute, told CNBC’s “Street Signs” that President Bush’s tax cuts have played a part in boosting the government’s tax revenues.
Tax revenues rose for the third year in a row and 2007 payments are set to break 2001’s record.
“(Tax) revenues are soaring,” Edwards said. “They’ll be up at least 8% or so this year on top of about 15% growth last year. If you look at capital gains in particular, the president cut the capital gains rate from 20% to 15% back in 2003, but capital gains revenue has not fallen. It has exactly doubled over the last four years. So, you cut the rate and you get a lot more revenue. The main thing driving the flood of revenue into Washington is the strong economy. It’s making both individual and corporate tax revenues flood into Washington. I think the Bush tax cuts are a part of the reason why this is happening.”