Dave Camp: How to Fix Our Appalling Tax Code

February 27th, 2014 by NC Tea Party Staff Categories: Archives One Response
Dave Camp: How to Fix Our Appalling Tax Code

There have been so many changes to the tax code over the past decade that it is now 10 times the size of the Bible, but with none of the Good News. That factual statement usually gets a good laugh back home in Michigan. What isn’t funny is the effect that constant tinkering with taxes has had on the people who pay them, and on the economy.

According to Nina Olsen, the National Taxpayer Advocate at the IRS, Americans overall spend over six billion hours and $168 billion every year to file their returns. This is stark testimony to the complexity of the tax code. Meanwhile, owners of small businesses face tax rates as high as 44.6%, while the total (state and federal) U.S. corporate rate, 39.1%, is the highest in the industrialized world.

Martin Kozlowski

The last time the U.S. enacted a comprehensive tax reform was 1986. But many of America’s major competitors have been actively reforming their tax laws in recent years. Even our closest neighbors are getting ahead of us. Canada has already reformed its tax laws and Mexico is doing so right now. If Congress doesn’t take action, the U.S. risks falling further behind.

The tax code should make it easier for American companies to bring back profits earned overseas so they can be invested here. It should not hinder small businesses from growing into large businesses. And the individual income tax needs to be simpler, fairer and flatter for everyone.

On Wednesday, I am releasing what a simpler, fairer tax code actually looks like. The guiding principle is that everyone should play by the same rules—your tax rate should be determined by what’s fair, not by who you know in Washington. Here is what it would look like:

First, the tax code will be made simpler—so every family can do its own taxes confidently, without fearing an audit, or wondering if someone else who can afford an expensive accountant is getting a better deal.

Today there are 15 different tax breaks for education—nine for current expenses, two for past expenses and four for future expenses. The IRS instructions explaining it all come to almost 90 pages. That isn’t a tax code designed for working families; it is a tax code designed to make money for accountants.

Last year, my Democratic counterpart on the Ways and Means Committee, Sandy Levin of Michigan, and I created 11 bipartisan working groups to tackle different parts of the tax code. One of those, headed by Diane Black (R., Tenn.) and Danny Davis (D., Ill.), looked into those education provisions. After months of work, the leaders of the working group recently came forward with a plan that consolidates four of these provisions into one improved credit, making it easier for families and students to afford a college education.

Related Video

Heritage Foundation chief economist Steve Moore on Republican Dave Camp’s new plan to overhaul and simplify the tax code.

Paired with more commonsense reforms like increasing the standard deduction and the child tax credit will mean that nearly 95% of the country can get the lowest possible tax rate by just filing the basic IRS 1040A form—no more itemizing, no more keeping track of all those receipts, and no more filling out all those extra schedules, forms and work sheets.

Second, the tax code will be made more effective and efficient by getting rid of special-interest handouts, which will mean lower tax rates for individuals, families and all businesses. Under this plan, over 99% of tax filers will face a top tax rate of 25%—allowing small and large businesses alike to expand operations, hire new workers and increase benefits and take home pay. On the individual side, there will be an introductory bracket of 10%.

Nonpartisan, independent economists at the congressional Joint Committee on Taxation have already analyzed this plan. According to those estimates, after this streamlining of the tax code, the size of the economy will increase by $3.4 trillion over the next decade, or roughly 20% compared with today. This will lead to nearly two million new jobs—and producing up to $700 billion in additional federal revenues that can be used to lower taxes even further or reduce the debt.

What does this mean for you and your family? Because we will have a healthier economy, wages will rise. With more income but lower tax rates, families with a median income ($51,000 for a family of four) will have on average an extra $1,300 in their pocket at the end of the year.

Third, make the tax code fairer and more accountable. That means no more hidden provisions that benefit a favored few, and no more tax increases to fuel more spending.

We can clean up provisions like “carried interest” that allow certain private-equity firms to get the investment-income tax rate on what anyone else would call normal wage income. We’ll also put an end to special depreciation benefits related to corporate jets and close, once and for all, the infamous “John Edwards” loophole that allows a select few to avoid employment taxes on their income. The revenue gained from that provision, and many others like shifting to Roth-style retirement accounts for those contributing more than $8,750 (only 5% of the workforce) can be used to lower tax rates across the board.

The tax code changes in my plan are not intended as a means of raising revenue. If loopholes are closed, Americans should get the benefit by way of lower rates.

Tax reform needs to be about strengthening the economy and making the code simpler and fairer. That’s what Republican President Ronald Reagan did when he worked with Democrats in Congress in 1986. We need to get to work and repeat that success.

Mr. Camp, a Republican, is chairman of the House Committee on Ways and Means.

Read article from WSJ here.

Big Tax Reform Making It’s Way Through Congress – We Must Now Pressure Senate

February 27th, 2014 by NC Tea Party Staff Categories: Archives One Response
Big Tax Reform Making It’s Way Through Congress – We Must Now Pressure Senate

House Speaker John Boehner, R-Ohio, said Wednesday that he welcomes a conversation on tax reform, even though the issue is unlikely to go anywhere in Congress in this midterm election year.

The issue was pushed to the forefront by House Ways and Means Committee Chairman Dave Camp, R-Mich., who has been working on a comprehensive tax overhaul proposal for years. The plan he introduced would drop the top income tax rate from 39.6 percent to 25 percent and would reduce the number of income tax brackets from seven to two. It would also impose a surtax on some income above $450,000, though that would not apply to capital gains or investments.

The reforms would be revenue-neutral, which will won’t appeal to Democrats who wanted to raise more money by closing loopholes. Instead, the new tax code would necessarily have to eliminate or reduce some popular tax breaks.
Plan to simplify tax code to be revealed by Ways and Means chairman

“My job is to present this option to the American people,” he told CBS News congressional correspondent Nancy Cordes. “They’ll ultimately decide if we’ll move forward on this or not, but I think when people see we can make their lives better through a simpler, fairer, flatter tax code, I think they’ll be excited about it.”In a Wall Street Journal op-ed out Wednesday, Camp said the guiding principle of the reform is that “everyone should play by the same rules—your tax rate should be determined by what’s fair, not by who you know in Washington.”

Though a complex issue like tax reform could put internal pressure on the GOP, Boehner was careful not to dismiss it out of hand at his weekly press conference Wednesday.

“We all know our tax system is broken, we all know that it frankly gets in the way of economic growth,” he said. “It’s time to have a public conversation about the issue of tax reform, and so I welcome the conversation, frankly I think it will be healthy, it will be informative, and I look forward to it.”

But Boehner stopped short of calling Camp’s draft the official Republican position, saying that would be, “getting a little bit ahead of yourself.”

House Budget Committee Chairman Paul Ryan, R-Wis., who is poised to take over the Ways and Means Committee when Camp’s chairmanship expires at the end of the year, congratulated Camp for putting a proposal on the table and called the plan “the beginning of a good debate.” But as for whether there would be a vote on the plan this year, Ryan said, “That remains to be seen.”

A major obstacle: the Senate leaders of both parties, who have already indicated tax reform has no future in Congress this year.

“I think we will not be able to finish the job, regretfully, in 2014,” Senate Minority Leader Mitch McConnell, R-Ky., said Tuesday. “Now, if we had a new Republican Senate next year, coupled with a Republican House, I think we could have at least a congressional agreement that this is about getting rates down, and making America more competitive.”

Senate Majority Leader Harry Reid, D-Nev., seemed to agree – but blamed the GOP. “The truth is we should have tackled tax reform years ago,” he said. “It would be extremely difficult… with the obstruction that we get here from the Republicans on virtually everything.”

Sen. Hagan runs from Obamacare question on canceled plans

February 26th, 2014 by NC Tea Party Staff Categories: Archives No Responses
Sen. Hagan runs from Obamacare question on canceled plans

On Monday, Sen. Kay Hagan (D-NC) repeatedly refused to answer a simple question on when she knew people wouldn’t be able to keep their current plans under Obamacare.

Sen. Hagan promised on at least 24 separate occasions people in North Carolina would be able to keep their current health care plan — once Obamacare went into effect — if they wished to do so.

However, she dodged the question at her press conference after she made it official she’d be running for re-election.

One reporter asks, “Much has been made about if you like you health care plan you can keep it, but what we’re still not sure about is, when exactly did you learn that wasn’t the case? Because you were on a lot of committees that helped write the bill. Was there a specific time frame — a day, a month, a week — that you can narrow it to when you learned that wasn’t going to be the case?”

Hagan avoids the question. Instead, she talks about a bill she is sponsoring that will allow people to keep their plans.

WATCH:

After the press conference, she was once again pressed in the parking lot. This time, she walked away from the reporter without answering the question.

Visa wants to Re-Elect Kay Hagan

February 26th, 2014 by NC Tea Party Staff Categories: Archives No Responses
Visa wants to Re-Elect Kay Hagan

A woman representing Visa’s Government Relations Office in Washington DC says “Let’s get her re-elected to a group of students”. Kay Hagan was there to teach students about financial literacy, in reality she should have been sitting in the audience. But Visa is telling students to re-elect Kay Hagan.

“Shared Responsibility Payment” to describe Obamacare individual mandate tax.

February 26th, 2014 by NC Tea Party Staff Categories: Archives No Responses
“Shared Responsibility Payment” to describe Obamacare individual mandate tax.

obamatheawfulhumanbeing

The name should tick off any real American. We do not have any shared responsibility in this country, it is anti-American.

Agency employs Orwellian term “Shared Responsibility Payment” to describe Obamacare individual mandate tax.

President Obama’s Internal Revenue Service today quietly released a series of Obamacare “Health Care Tax Tips” warning Americans that they must obtain “qualifying” health insurance – as defined by the federal government – or face a “shared responsibility payment” when filing their tax returns in 2015. The term “shared responsibility payment” refers to the Obamacare individual mandate tax, one of at least seven tax hikes in the healthcare law that directly hit families making less than $250,000 per year.

In “Four Tax Facts about the Health Care Law for Individuals” the agency writes:

Your 2014 tax return will ask if you had insurance coverage or qualified for an exemption.  If not, you may owe a shared responsibility payment when you file in 2015.

In “The Individual Shared Responsibility Payment- An Overview” the agency warns Americans they must prove they were covered each and every month of the year:

For any month in 2014 that you or any of your dependents don’t maintain coverage and don’t qualify for an exemption, you will need to make an individual shared responsibility payment with your 2014 tax return filed in 2015.

In “IRS Reminds Individuals of Health Care Choices for 2014”the agency details the calculations Americans can look forward to if they are liable for the tax:

If you (or any of your dependents) do not maintain coverage and do not qualify for an exemption, you will need to make an individual shared responsibility payment with your return. In general, the payment amount is either a percentage of your household income or a flat dollar amount, whichever is greater. You will owe 1/12th of the annual payment for each month you (or your dependents) do not have coverage and are not exempt. The annual payment amount for 2014 is the greater of:

1 percent of your household income that is above the tax return filing threshold for your filing status, such as Married Filing Jointly or single, or
Your family’s flat dollar amount, which is $95 per adult and $47.50 per child, limited to a maximum of $285.

As confirmed by previous  IRS testimony to the tax-writing House Committee on Ways and Means, “taxpayers will file their tax returns reporting their health insurance coverage, and/or making a payment”.

Once fully phased in, the Obamacare individual mandate tax will rise steeply, to a maximum of 2.5 percent of Adjusted Gross Income or $2,085 – whichever is higher

 

Some Comments:

– Hey IRS….Obammycare
╭∩╮(︶︿︶)╭∩╮
…both barrels to ya!

– Amen, Brother! We gotta dump these Government thugs in the Potomac. America Wake Up — you have nothing to lose but your chains!

– I DO THINK WE ARE GETTING NEAR THE TIME OF REVOLUTION AGAIN !

– First it’s a mandate, then it’s a tax or a mandate tax penalty, now a shared responsibility payment…so very devious. People might be less inclined to comply with a law that they’ve heard is illegitimate or unconstitutional.

– Everyone needs to adjust their withholding so that 1) the government cannot use your money all year without paying you interest, and 2) you will not receive a tax refund, so they cannot withhold your Obama care penalty.

– I will NOT COMPLY. and as I get no tax refund, they cannot do a damned thing about it.

Civil Disobedience……….do your duty.

More here

 

Greg Brannon co-defendant: Ruling defies logic

February 26th, 2014 by NC Tea Party Staff Categories: Archives 6 Responses
Greg Brannon co-defendant: Ruling defies logic

Much political hay is being made of the lawsuit against US Senate candidate Greg Brannon. The Republican doctor was found liable for misleading two investors in a tech company that went bust a couple years ago.

Democrats and the left say it proves Tea Partiers, conservatives, and Republicans are corrupt liars.

Republicans who support other candidates in the GOP primary see it as the death knell of Brannon’s campaign.

I liked Brannon’s candidacy and have been impressed with his knowledge of the US Constitution and its limiting principles. Even one of Brannon’s opponents – Thom Tillis – acknowledged Brannon’s superior understanding of our founding document.

There are some candidates in the Primary who are far more studied than I am on the Constitution.

But, politically, I suspect most people will not take the time to look into the lawsuit against Brannon. His opponents (particularly if he gets to the general election) will use the ruling in campaign ads mercilessly.

And, again, most won’t care to know the details.

For those who DO care, take a listen to this interview I did with Robert Rice.

Rice was Brannon’s co-defendant in the civil trial. Rice was found NOT liable by the same jury that found Brannon liable… despite the same evidence against both men.

The case

Two investors allege Brannon, Rice and David Kirkbride said the smartphone app the company was making would be used in a Verizon marketing campaign. The potential was there to add the app onto all Verizon smartphones.

This information came from a meeting that the company COO John Cummings had with Verizon. Oddly, the investors didn’t sue Cummings, when it was his report from the Verizon meeting that prompted this e-mail from Brannon to the investors:

 

Brannon was not an officer of the company. The information was coming from Cummings. The jury in this case somehow decided that this e-mail was proof that Brannon misled the two investors (one of whom didn’t invest until almost a year later, says Rice).

The absurdity of this ruling is clear when you consider that

  • Cummings wasn’t sued
  • a judge dismissed the case against Kirkbride earlier
  • Rice was found not liable
  • all the parties (including the plaintiffs) agreed that Brannon, Cummings, Rice, and Kirkbride all said the same thing

How can only one person have misled the investors when they all said the same thing?

It’s for these (among other) reasons that Rice said the jury ruling defies logic.

The jury also seemed to be confused during deliberations about whether they should view Brannon’s refusal to testify as admission of guilt.

Rice testified. He was found not liable. Had Brannon done the same he may very well have gotten the same ruling.

Instead, Brannon was ordered to pay the investors $250,000 plus interest.

Rice says one of the investors promised to ruin Brannon and his campaign for US Senate – that this was a vindictive lawsuit because the investor tried to take over the company but failed.

Even so, the political damage might be too great to overcome.

But who knows, maybe I am wrong.

Maybe there are enough people interested in learning the details of the case and making up their own minds.