P RESIDENT ’ S T AX H IKES C HART 1

T AX R ELIEF M ADE T AX C ODE M ORE P ROGRESSIVE B REAKDOWN OF T AX B URDEN BY I NCOME L EVEL – 2001 VS 2008 C HART 2

10% 20% 30% 40% 50% 60% 70% 80% 90% 100% T OP I NCOME T AX B RACKET T OTAL T AX R EVENUE AS P ERCENT OF GDP I NCOME T AX R EVENUE AS P ERCENT OF GDP T AX R EVENUES D O N OT C ORRELATE W ELL WITH T AX R ATES F ISCAL Y EAR C HART 3

T AX R EVENUES ARE H IGHLY C ORRELATED W ITH GDP R EAL 2006 GDP ($B ILLIONS ) R EAL 2006 T AX R EVENUES ($B ILLIONS ) $3,500 $7,000 $10,500 $14,000 $500 $1,000 $1,500 $2,000 $2,500 R EAL T AX R EVENUE R EAL GDP C HART 4

C HASING H IGHER S PENDING WITH T AXES (I NCREASE IN T AX R ATES N ECESSARY TO K EEP P ACE S PENDING ) C HART 5