West rightly calls payroll tax bill a ‘backdoor tax increase’

Update, Feb. 18, 2012: It looks like Rep. West's concerns were addressed. I just read through the bill posted on the House Rules Committee website and this mortgage fee offset appears to have been removed from the bill. I have written to West's office for clarification.

This bill morphed from an easy-to-read 25-page document to a 200+ page behemoth rolling all sorts of issues into a single piece of legislation. You can read the letter from the Congressional Budget Office costing out the bill. Thanks to @BrianINC (Twitter) for pointing us to this link. The bill increases the deficit over a period of time by $101.1 billion dollars. ~~The Editors

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Original Article posted Feb. 17, 2012

Rep. Allen West (Fla.) is the only man in Congress honest enough to tell Americans about the de facto tax increase in the payroll tax bill Obama pushed. (Photo from US House of Representatives)I’ve tried to direct attention to what amounts to a tax increase embedded in the payroll tax bill Congress voted on Friday as President Barack Obama drilled down on them to pass the bill.

Embedded in that bill was what Rep. Allen West (R-Fla.) called a “backdoor tax increase” on homeowners and first time homebuyers.

That tax increase, in the form of a fee intentionally hidden from you even if you read every line item on your mortgage agreement, will be levied on every single home buyer (or those refinancing) for the next ten years. We all know what that means—Congress never takes a tax back.

West explained it all in a news release that is now posted at his Web site. West did his best to get attention. Only one media outlet—CBS—gave this story attention.

Fees will now be added to FHA-backed loans to homeowners—that means one-third of US mortgages contain this backdoor tax.

I called around this week and I talked to a number of committees and subcommittees in Congress. Every single one of them passed the buck.

Speaker John Boehner (R) told media the increase was in the bill the Senate came up with. Boehner said Republicans wanted to pay for the payroll tax bill with spending cuts.

President Barack Obama’s administration called the fee “modest.” Obama never met a tax he didn't heart.

Tell that to the homeowner CBS interviewed—she’ll cough up an extra $9,500 on her mortgage because the government decided to get a tax increase one way or the other.

Adding insult to serious injury, the tax dollars won’t go towards the social security fund the payroll tax decrease is depleting. No, it will go to the general Treasury fund where Congress can spend it maybe on a monument to one of their dead colleagues or perhaps a going-bankrupt Solar energy company.

How can conservative media sit quietly while this happens?

How can American voters accept this usury?

I know how West feels when it comes to trying to get people to pay attention to this matter.

West said, “The payroll tax cut deal is a result of politicians telling Americans what they want to hear, while seriously harming them and our nation in the long run. Americans sent a new wave of leaders to Capitol Hill in 2010 to stand up for conservative principles and turn this country around. I will continue to be a voice for those Americans."

He voted ‘No’ on the latest version of the payroll tax bill because Congress decided to rip off Americans.

I’d vote ‘Yes’ for Allen West for president anytime he decides to run.

If you think Democrats in the Senate and the Democrat in the White House are really going to look out for your interests, get your head checked.

Finally, it is glaringly obvious Republicans need new leadership in the US Senate.

I believe this matter provides grounds for a class action lawsuit. The fee is not disclosed to you as a home buyer or re-financer. Remember Obama's outrage about transparency in financial agreements? The president should practice what he preaches.

If your representative or senator agreed to this fee, he deserves your criticism.

(Commentary by Kay B. Day/Feb. 17, 2012)