Paul Votes to Repeal Tax Increase on Social Security Benefits

FOR RELEASE: July 28, 2000

Washington, D.C. - Congressman Ron Paul voted today to eliminate the 1993 tax increase imposed on Social Security benefits. H.R. 4865, the "Social Security Benefits Tax Relief Act", passed the House today despite an effort by Democrats to substitute a less comprehensive bill. "I introduced legislation to repeal this tax increase in 1997, and I am pleased to see Congress taking action to reduce a very unfair tax" Paul stated. "I hope my colleagues will join me in my efforts to repeal all taxes on Social Security benefits."

Prior to 1984, Social Security benefits were exempt from federal income taxes. In 1993, the Clinton administration successfully proposed taxing up to 85% of benefits, justifying the increase as needed to reduce the budget deficit. "President Clinton and most members of Congress say the budget deficit is gone," Paul said. "By their own reasoning, there is no need to keep this tax hike in place."

"Social Security benefits are financed with tax dollars, so imposing a tax on them is yet another example of double taxation" Paul continued. "Furthermore, 'taxing' benefits paid by the federal government is merely an accounting trick, which enables Congress to reduce benefits by subterfuge. This allows Congress to continue using the Social Security Trust Fund as a means of financing other government programs, while masking the true size of the federal debt."

Paul cosponsored H.R. 761, a bill that would eliminate all taxes on Social Security benefits. He also introduced H.R. 219, the "Social Security Preservation Act", which would ensure that all monies in the Social Security Trust Fund are spent solely on benefit payments. "When the government takes money out of your paycheck for the Social Security Trust Fund, it makes a promise that the money will be there for you when you retire," Paul said. "Congress has a moral obligation to keep that promise."

"We have a long way to go in reducing the burdens imposed on senior citizens by the federal government" Paul concluded. "I will continue my efforts to eliminate taxes on Social Security and prevent Congress from spending Social Security funds on frivolous government programs."