- Nov 26, 2011
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First things first. This is a complicated subject. If you have the attention span of a Tweet, please do not participate.
Secondly, this tax reform plan has nothing to do with Trump. The plan was written long before the election.
The Republican Party has created something they call "A Better Way". Under Speaker Ryan's leadership, six committees were formed in the House. Those six committees were formed to address:
1. Poverty
2. National Security
3. The Economy
4. The Constitution
5. Health Care
6. Tax Reform
You can read each committee's plan here: A Better Way
Since this topic is about the Tax Reform plan, you can go directly to it here: https://abetterway.speaker.gov/_assets/pdf/ABetterWay-Tax-PolicyPaper.pdf
As it is 30 pages long, and addresses both Individual and Corporate taxes, I am splitting this into two threads, with this one on Individual taxes first. I will touch on some of the corporate stuff, but only a little. But I must say the corporate tax scheme has a gigantic bombshell in it.
The reason I am starting this topic now is that the GOP is about to start pushing legislation for tax reform very soon, and it will be built on this Better Way plan.
So, to begin. Many of you know I have been griping about tax expenditures for years and years. I have tried to educate the pseudocons about this trillion dollar lie, and show them just how far off the Conservative reservation they are, all to no avail. They have been too long conditioned to be welfare queens when it comes to tax expenditures, having no clue they are active participants in the robbery of their own bank accounts.
As you read the Better Way tax plan, you see I am vindicated. Big time.
One of the things I have endlessly pointed out is that every tax expenditure (deduction, credit, exemption) comes out of someone else's pocket, making them no different than food stamps. Innumerate pseudocons have virulently denied this, claiming a deduction means "I get to keep more of my own money". That is a lie. Every deduction has to be made up for by higher tax rates, which means it is paid for by every taxpayer.
And we see this over and over again in A Better Way:
When they talk about "provisions", they mean tax expenditures. Deductions, credits, exemptions.
More:
Problem #2: The Current Code Delivers Special Interest Subsidies and Crony Capitalism. The tax code is littered with hundreds of preferences and subsidies that pick winners and losers and create complexity. Instead of free-market competition that rewards success, our tax code directs resources to politically favored interests, creating a drag on economic growth and job creation. In fact, Washington encourages individuals and businesses to make investment decisions based not on the most promising new technologies and innovations, but instead on the promise of tax savings. Many of these tax preferences, sometimes referred to as “tax expenditures,” are special-interest giveaways that are masked as tax breaks instead of direct grants. For fiscal year 2016, such “spending” through the tax code amounts to more than $1.4 trillion, or almost three-fourths of the amount of revenue raised by the entire Federal income tax. When Washington picks winners and losers with the tax code, the American people ultimately pay higher tax rates and keep less of their hard-earned money.
The long and the short of it is that the GOP plan eliminates almost all individual tax expenditures, save two. Unfortunately, they kept the Mortgage Interest Deduction (MID), which increases the cost of your house and must be paid for with higher tax rates. However, the real estate lobby spends $110 million a year on lobbying and campaign contributions to keep the MID alive. In return, they and the banks and the homebuilders get $80 billion in returns on their investment.
Nevertheless, this is a great start. It is a massive reduction in tax expenditures.
Thank you very much. Finally, finally, finally, finally some sanity is being restored.
In return for eliminating all those tax expenditures, the tax plan reduces tax rates.
What's more:
More to come.
Secondly, this tax reform plan has nothing to do with Trump. The plan was written long before the election.
The Republican Party has created something they call "A Better Way". Under Speaker Ryan's leadership, six committees were formed in the House. Those six committees were formed to address:
1. Poverty
2. National Security
3. The Economy
4. The Constitution
5. Health Care
6. Tax Reform
You can read each committee's plan here: A Better Way
Since this topic is about the Tax Reform plan, you can go directly to it here: https://abetterway.speaker.gov/_assets/pdf/ABetterWay-Tax-PolicyPaper.pdf
As it is 30 pages long, and addresses both Individual and Corporate taxes, I am splitting this into two threads, with this one on Individual taxes first. I will touch on some of the corporate stuff, but only a little. But I must say the corporate tax scheme has a gigantic bombshell in it.
The reason I am starting this topic now is that the GOP is about to start pushing legislation for tax reform very soon, and it will be built on this Better Way plan.
So, to begin. Many of you know I have been griping about tax expenditures for years and years. I have tried to educate the pseudocons about this trillion dollar lie, and show them just how far off the Conservative reservation they are, all to no avail. They have been too long conditioned to be welfare queens when it comes to tax expenditures, having no clue they are active participants in the robbery of their own bank accounts.
As you read the Better Way tax plan, you see I am vindicated. Big time.
One of the things I have endlessly pointed out is that every tax expenditure (deduction, credit, exemption) comes out of someone else's pocket, making them no different than food stamps. Innumerate pseudocons have virulently denied this, claiming a deduction means "I get to keep more of my own money". That is a lie. Every deduction has to be made up for by higher tax rates, which means it is paid for by every taxpayer.
And we see this over and over again in A Better Way:
When they talk about "provisions", they mean tax expenditures. Deductions, credits, exemptions.
More:
Problem #2: The Current Code Delivers Special Interest Subsidies and Crony Capitalism. The tax code is littered with hundreds of preferences and subsidies that pick winners and losers and create complexity. Instead of free-market competition that rewards success, our tax code directs resources to politically favored interests, creating a drag on economic growth and job creation. In fact, Washington encourages individuals and businesses to make investment decisions based not on the most promising new technologies and innovations, but instead on the promise of tax savings. Many of these tax preferences, sometimes referred to as “tax expenditures,” are special-interest giveaways that are masked as tax breaks instead of direct grants. For fiscal year 2016, such “spending” through the tax code amounts to more than $1.4 trillion, or almost three-fourths of the amount of revenue raised by the entire Federal income tax. When Washington picks winners and losers with the tax code, the American people ultimately pay higher tax rates and keep less of their hard-earned money.
The long and the short of it is that the GOP plan eliminates almost all individual tax expenditures, save two. Unfortunately, they kept the Mortgage Interest Deduction (MID), which increases the cost of your house and must be paid for with higher tax rates. However, the real estate lobby spends $110 million a year on lobbying and campaign contributions to keep the MID alive. In return, they and the banks and the homebuilders get $80 billion in returns on their investment.
Nevertheless, this is a great start. It is a massive reduction in tax expenditures.
Thank you very much. Finally, finally, finally, finally some sanity is being restored.
In return for eliminating all those tax expenditures, the tax plan reduces tax rates.
What's more:
More to come.
