$12 Trillion of New Household Wealth
WASHINGTON – In 2003 President Bush signed into law the Jobs and Growth Tax Relief Reconciliation Act (JGTRRA). The legislation cut income tax rates, reduced the capital gains tax rate by 25 percent and substantially reduced the double tax placed on dividends. Immediately following the tax cut, economic growth, job creation, stock prices, dividends, and personal income skyrocketed. The 2003 tax cut has been an unmitigated success and should be extended.
Prior to the tax cut, household net worth substantially declined with more than $7 trillion of shareholder wealth evaporating due to the bursting of the dot com bubble, recession, war, and corporate scandals. As the chart below demonstrates, immediately following the tax cut, household net worth rapidly increased by $12 trillion in two and half years.
Congress needs to extend the lower tax rates on dividends and capital gains.
Tax Cut Dramatically Boosts Total Household Net Worth