Unless Congress and President Barack Obama can reach agreement by the end of this year, steeply higher taxes - amounting to about half a trillion dollars annually - will slam the economy and most taxpayers, starting Jan. 1, 2013. For starters, 25 million middle-income taxpayers will be hit for the first time by the alternative minimum tax.

This "tax-mageddon" looms because the president and the Democratic majority in the Senate have, for the past three years, remained insistent on raising taxes. Congressional Republicans have fought to hold the line. But because this disagreement on tax policy is not yet reconciled, roughly 100 tax cuts are set to expire at the end of this year and a half-dozen new taxes to pay for the Obama health law are set to take effect Jan. 1. Here is some of what's in store:

• Alternative minimum tax: Twenty-five million more middle-income taxpayers will be hit in 2013 with an estimated $118 billion in higher taxes. (Note: The AMT was passed in 1969 to ensure that a couple of hundred millionaires would pay their "fair share.") For example, exemptions are now $48,450 for individuals and $74,450 for married couples filing jointly. If Congress fails to act by the end of this year, exemptions will return to $33,750 for individuals and $45,000 for married couples filing jointly.

• Deduction of state and local taxes. The deductibility expired at the end of 2011. It was put in place with amendments offered by Rep. Kevin Brady (R-Texas) and myself. Because Texans aren't saddled with a state income tax, loss of the sales tax deduction will be particularly costly for them.

• Marriage penalty. The Marriage Penalty Relief Act, which I sponsored, addressed the perverse tax penalty on married couples. But the previous penalty on marriage is set to kick in again for 2013 if we can't extend it.

• Child tax credit. It will be halved from $1,000 to $500 for 2013.

• Estate taxes. The "death tax" reverts to a 55 percent rate in January of next year with a $1 million exemption. Many of America's family-owned small businesses will be hit hard by this tax hike.

• Investment and job creation: Capital gains tax will increase to 20 percent, and dividends will be taxed at ordinary income tax rates. Specifically for individuals and couples earning more than $200,000 and $250,000 respectively, two new health care reform surtaxes will force the capital gains and dividends tax rates even higher: capital gains to 23.8 percent and dividends to 43.4 percent. Raising capital gains and dividends tax rates will most likely drain away critical private investment capital that entrepreneurs and startups need to create jobs and expand their enterprises.

Also set to take effect in 2013 are a half-dozen new taxes enacted in 2009 to pay for the Obama health care law. These increase taxes on affected small businesses; drive up the cost of medicines and health insurance, and jeopardize job-based health insurance coverage for millions of working Americans and their families.

The risk of inaction on these tax issues for our economy and our country is enormous. If you're employed, you will pay more in taxes in 2013. If you're unemployed, it will be harder to find a job. If you run a business, it will be harder to stay in business, much less hire more people.

Notwithstanding what could be the terrible economic consequences, there has been a conspicuous lack of urgency from both the president and congressional Democrats about addressing these tax increases. The White House strategy seems to be: 1) do nothing until after the November election; 2) blame a government shutdown and economic meltdown on Congress if it doesn't approve higher taxes before the end of 2012.

Speaker John Boehner (R-Ohio) has wisely indicated that the House will vote before the November elections to extend all of the current tax rates, credits and deductions now set to expire at the end of the year. Waiting until the last minute, as in 2010, is not a responsible way to govern. At best, delaying tax policy decisions puts businesses' and families' financial decisions on hold - also bad for our weak economy.

A simpler, fairer income tax system, based on lower, flatter rates, would turbocharge economic growth and private-sector job creation. The alternative is more of the same turmoil that has pushed the national debt above $16 trillion and is keeping unemployment above 8 percent.

The right thing to do for our country is to call a truce in election-year political games. But we shouldn't just stop at preventing the end-of-the-year tax-mageddon. The president and Congress should put comprehensive, pro-growth reform of the entire Tax Code at the top of the legislative agenda for this summer.