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Its all about the benjamins…
By sage of monticello | October 11, 2007
Charles Rangel, New York Democrat and Chair of the powerful House Ways and Means committee, has long planned a “mother” of all tax reforms, the base of which would be the elimination of the Alternative Minimum Tax (AMT) - a tax meant to ensure that the rich didn’t avoid paying taxes by abusing charitable tax credits.
The elimination of the AMT would cost $1 trillion over the next decade. The support for the elimination of the AMT is bipartisan. Republicans and Democrats agree that the AMT annually ensnares people who were not intended for it to ensnare. However, a bright-line distinction can be made between Republicans and Democrats in how to handle the effects of the elimination of the AMT.
Democrats, of course, advocate higher taxes, whereas Republicans advocate a leaner, smaller, and more limited government. This means that to eliminate the AMT the Democrats want to raise taxes by $1 trillion and Republicans want to eliminate the same from the budget permanently.
For example, a bill sponsored today by reform minded Republicans led by Rep. Paul Ryan (R-WI) would dramatically simply the tax code, lessen the tax burden on all Americans, as well as eliminating the AMT.
Robert Novak writes of Ryan’s legislation:
Back on their heels in a defensive posture all year while majority Democrats in Congress offered liberal initiatives, reform-minded conservative Republicans this week introduce the most sweeping tax plan since Jack Kemp’s three decades ago. It would establish a radically simplified, flatter tax for an estimated 90 percent to 95 percent of all income tax filers.
Those taxpayers presumably would accept this offer: give up all your current deductions, and your annual earnings up to $100,000 would be taxed at 10 percent, with a 25 percent rate on everything above that. But that is not all. The bill would repeal the hated Alternative Minimum Tax (AMT), giving up $840 billion in revenue over the next 10 years. Government would have to get leaner.
Ryan’s proposal would also make permanent President Bush’s capital gains and dividends tax cuts.
Lastly, and more of a side note within the larger AMT tax issue, but still important is the Internet Tax moratorium. The House Judiciary Committee today passed a four-year extension of the moratorium on Internet access taxes after defeating Republican proposals to extend the ban permanently or for eight years.
Senators McConnell, McCain, and Sununu are working to get a vote on a permanent ban in the Senate.
Topics: conservativism, socialism, tax policy, Congress, wealth redistribution |
October 17th, 2007 at 4:09 pm
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