Correcting Misconceptions About the Border Adjustable Cash-Flow Business Tax

Share on Facebook
Tweet this Story
Pin this Image

Posted by Alexander Hendrie on Tuesday, February 7th, 2017, 9:00 AM PERMALINK

The House Republican “Better Way” tax reform blueprint proposes a desperately needed overhaul of the tax code. It has been more than 30 years since tax reform was last signed into law, and it is past time this outdated code was updated.

On both the individual side and business side, the plan reduces taxes across the board. In addition, the plan calls for much needed simplification, and implements numerous pro-growth policies. Specifically, the blueprint transforms the current corporate income tax to a cash-flow business tax through the implementation of full business expensing, the creation a territorial system of international taxation, and adding a border adjustability component.

While the plan is extremely pro-growth, border adjustability has been subject to mischaracterization and confusion. While it may sound to some like a tariff or a Value-Added Tax, it contains important differences with both. Instead, it should be viewed as an integral part of a modern, internationally competitive cash-flow business tax that replaces the cumbersome corporate income tax used today. 

Is Border Adjustability A New Tax?
Although some have described the border adjustability component of the cash-flow business tax as a new, one trillion dollar tax on imports, this is a complete mischaracterization. While the border adjustability component raises revenue, it should not be viewed in isolation, but as a base broadener that facilitates lower rates for all businesses.

Border adjustability should also be considered in the context of the many, pro-growth changes in the Better Way plan, and as part of a system that equalizes the taxation of American businesses relative to foreign competitors. It is a dramatic tax cut for businesses and consumers relative to our existing system of taxation, as the plan creates a new, low rate for corporations of 20 percent and a 25 percent rate for pass-through entities.

The House plan reduces taxes on small businesses and corporations by about $4 trillion through reductions in marginal rates and by allowing immediate expensing of new business investments, which greatly exceeds the $1 trillion raised by border adjustability. In total, the plan reduces taxes by $2.4 trillion on a static basis, according to estimates by the Tax Foundation. Through the many pro-growth policies, the plan also leads to increased household income of almost 9 percent after economic feedback.

How Does Border Adjustability Work and Why is it Needed?
Under the border adjustability system, the costs associated with products exported from the US are fully deductible from the cash-flow tax, and the costs associated with products imported into the US are not deductible from the cash-flow tax.

This change is made to ensure American businesses are on a level playing field with foreign competitors, not so they have a protectionist advantage. America is the only nation without border adjustment among the 35-member Organisation for Economic Co-operation and Development (OECD) and the five country BRICS (Brazil, Russia, India, China and South Africa). The only other countries with a border adjustment include nations like North Korea, South Sudan, Iraq, Myanmar, and Western Sahara. 

[See the Full Map of Countries with and Without Border Adjustment Here]

Normally, when a product leaves a country the border adjustment mechanism adjusts rates downward, which is then offset when it enters the new country which border adjusts rates upwards. Neither country is imposing a tariff, rather they are taxing based on where the product is consumed.

Because the US does not have a border adjustment mechanism, American businesses that sell products overseas face an export penalty relative to transactions between two other countries with border adjustable systems. Similarly, foreign businesses selling in the U.S. receive an import tax break compared to transactions between two other developed nations.

Is the Border Adjustment Component A Tariff?
A border adjustment mechanism is not a tariff – it is administered through the tax code so it cannot be considered trade policy.

The differences between the two are far from technical. Implementing a border adjustment system is about treating exports and imports equally in the global economy. Implementing a tariff is about reducing imports from another country in a discriminatory way.

Border adjustability is trade neutral because the export portion and the import portion of the border adjustment are off-setting and equal in nature. Any revenue raised is dependent on the size of the country’s trade deficit or surplus. 

In the U.S. context, the border adjustment component of the cash-flow business tax raises a projected $1 trillion over a decade, but this is solely because of the U.S. trade deficit which totals roughly $500 billion every year. Every dollar worth of goods leaving the country cancels out one dollar worth of goods arriving in the country. A trade surplus would result in the component raising no revenue. 

Border adjustability is also likely compliant with the World Trade Organization –the global body governing international trade—because it is structured around an indirect, consumption based tax. The cash-flow business tax contains many components of an indirect tax such as the elimination of interest deductibility and allowing full business expensing to ensure it is compliant with global norms.

How Does the Cash-Flow Business Tax Differ From A Value-Added Tax?
The cash-flow, border adjustment tax in the House blueprint is not a VAT.

The most important difference between the two is that the House tax plan allows for a business to deduct any labor compensation, which is then taxed through the individual income tax. This ensures that taxation is transparent to voters and taxpayers. In contrast, VATs have a much broader base that includes all compensation paid to workers, which shields the true impact of the tax from those who pay it.

This difference addresses a key problem with the VAT – that it is hidden from taxpayers. The VAT is applied at every stage of consumption, from wholesale to retail. It is passed along until it literally becomes as much an inherent and cloaked component in the price as transportation or raw materials. It is embedded in the final cost of the goods sold, and is hidden to the consumer. As a result, countries that have adopted a VAT can easily raise the rate over time to expand the size of government. The same cannot be said for the cash-flow border adjusted business tax.

 

Photo Credit: 
https://www.flickr.com/photos/lulupine/

More from Americans for Tax Reform


ATR Supports H.R. 523, The Debt Transparency and Accountability Act

Share on Facebook
Tweet this Story
Pin this Image

Posted by Natalie De Vincenzi on Tuesday, February 7th, 2017, 9:00 AM PERMALINK

Representative Kenny Marchant (R-Texas) has introduced the Debt Transparency and Accountability Act, H.R. 523. This legislation creates a clear framework for holding the administration accountable for any increase in the debt and requires the Treasury Secretary to produce options for reducing the debt. This bill passed in the last Congress with bipartisan support, so legislators on both sides of the aisle should have no problem in supporting this key piece of legislation.

This legislation requires the Treasury Secretary to appear before the House Ways and Means and the Senate Finance Committee between 21 and 60 days before it is anticipated that the debt limit will be reached. Specifically, the Secretary will be required to present a detailed report outlining the nation’s financial state while also proposing substantive reforms.

Firstly, the Secretary will be required to report on the current state of the debt (including historical levels of debt, current composition of debt, and future debt projections).

Secondly, this bill will require the administration to propose detailed proposals to reduce the debt in the short-term, medium-term, and long-term.

Thirdly, the legislation requires the administration to project how increasing the debt limit will affect future spending, debt service, and the strength and stability of the U.S. dollar as the international reserve currency.

Lastly, the Secretary will be required to report projections of the long-term sustainability of mandatory entitlement programs including Social Security, Medicare, and Medicaid. 

In addition, the legislation requires the Treasury Secretary to present progress reports on efforts to reduce the debt when returning to Congress to ask for future debt ceiling increases.

The Debt Transparency and Accountability Act creates a clear, yet comprehensive framework that any administration must follow to reduce federal debt when requesting a debt limit increase. By requiring the submission of a detailed report and comprehensive plan before Congress, H.R. 523 ensures that increasing the debt ceiling only occurs as part of a framework of serious proposals to reform the nation’s finances and chart a pathway toward fiscal responsibility. Americans for Tax Reform supports this legislation and urges all members of Congress to support or cosponsor this bill.

Photo Credit: 
Images Money

More from Americans for Tax Reform


ATR Releases Coalition Letter Opposing the Postal Service Reform Act (H.R. 756)

Share on Facebook
Tweet this Story
Pin this Image

Posted by Justin Sykes on Monday, February 6th, 2017, 1:34 PM PERMALINK

Americans for Tax Reform, joined by 23 free market organizations, today sent an open letter to Congress urging lawmakers to oppose H.R. 756, the “Postal Service Reform Act of 2017” introduced by House Government Oversight Committee Chairman Jason Chaffetz (R-Utah), and the Committee’s Ranking Member Elijah Cummings (D-Md.).

Since 2007, USPS has posted more than $50 billion in losses and faces $125 billion in unfunded liabilities, despite an estimated $18 billion annually in indirect subsidies.

While reforms are needed, the Postal Service Reform Act ignores basic needed reforms to USPS, and instead increases rates, shifts USPS’s financial burden onto the American public, and allows for the diversion of resources away from the core mission of mail delivery.

Read the full letter below or here:

February 6, 2017

Open Letter to Congress:

Protecting Taxpayers and Consumers from Increased Rates, Ill-advised Reforms, and Further Exacerbation of the U.S. Postal Service’s Financial Hardships – Opposing the Postal Service Reform Act of 2017

To Members of the U.S. Congress:

We, the undersigned organizations, representing millions of taxpayers and consumers nationwide, urge Congress to oppose H.R. 756, the “Postal Service Reform Act of 2017” introduced by House Government Oversight Committee Chairman Jason Chaffetz, and the Committee’s Ranking Member Elijah Cummings.

For years, the U.S. Postal Service (USPS) has suffered from operational and financial inefficiencies, and while reforms are needed, H.R. 756 misses the mark and may actually exacerbate the issues facing USPS.

The USPS enjoys a monopoly on the delivery of first-class and standard mail and is exempt from state and local sales, income, and property taxes. The USPS also has the power of eminent domain, is not subject to local zoning ordinances, and has borrowed billions from the Treasury at subsidized interest rates.

Despite such special treatment, which is estimated to be $18 billion annually in indirect subsidies, USPS’s financial health is continually waning. Since 2007, USPS has posted more than $50 billion in losses and faces $125 billion in unfunded liabilities. Much of this stems from USPS’s inability to adapt to changing markets, congressional impediments, and union quagmires.

Many of the reforms provided for in H.R. 756 lead USPS further away from the core mission of mail delivery, unfairly shift the Postal Service’s financial burdens onto the American public, and fail to address many of the underlying issues facing USPS.

Postal Rate Reforms and Increases. Chairman Chaffetz’s reform bill would allow the Postal Service to increase rates by 2.15 percent on monopoly products such as stamps. Monopoly products generate the bulk of USPS profits. Increasing rates will only reduce revenue and further drive more consumers away from USPS products and services. 

Diversion to Nonpostal Products and Services. Key provisions contained in H.R. 756 would allow the Postal Service to divert resources away from the core mission of mail delivery to providing nonpostal products and services to state, local, and tribal governments and federal agencies. The Act creates a “Chief Innovation Officer” tasked with managing the development and implementation of nonpostal products. While intended to generate new sources of revenue, such provisions are only a point of distraction, and will see the Postal Service further competing with private firms.

Postal Service Governance Reform. The USPS Board of Governors is comprised of nine members, not including the Postmaster General and Deputy Postmaster General, who are Presidentially appointed and confirmed by the Senate and serve seven-year terms. Since 2015, the Board of Governors has had only one Governor serving due to congressional hurdles. H.R. 756 would reduce the USPS Board of Governors from a nine-member board to a five-member board. This hollow reform does nothing to actually improve USPS governance, and instead reinforces the fact that most of the provisions in the bill are simply reforms for the sake of reforms, having no real impact on the status quo.     

We recognize the need for reforming the U.S. Postal Service. However Chairman Chaffetz’s Postal Service Reform Act ignores basic needed reforms to USPS, and instead increases rates, shifts USPS’s financial burden onto the American public, and allows for the diversion of resources away from the core mission of mail delivery.

It is for these reasons that we ask members of Congress to oppose this legislation.  

Grover G. Norquist                                           
Americans for Tax Reform                                    

David Williams                                                
Taxpayers Protection Alliance                                                            

Jim Martin                                                        
60 Plus Association                                          

Phil Kerpen                                                    
American Commitment                                        

John M. Palatiello                                             
Business Coalition for Fair Competition                                                        

Norm Singleton                                                           
Campaign for Liberty                                             

Andrew F. Quinlan
Center for Freedom and Prosperity                                                                       

Jeffrey L. Mazzella                                            
Center for Individual Freedom                                   

Col. Francis X. De Luca                                                              
Civitas Institute                                                 
 

Tom Schatz                                                     
Council for Citizens Against Government Waste          

Chuck Muth                                                     
Citizen Outreach                                               

Katie McAuliffe                                              
Digital Liberty   

Adam Brandon
Freedom Works

George C. Landrith
​Frontiers of Freedom

Mario Lopez
Hispanic Leadership Fund

Sabrina Schaeffer
Independent Women's Forum

Andrew Langer
Institute for Liberty

Kory Swanson
John Locke Foundation

Seton Motley
Less Government

Willes K. Lee
National Federation of Republican Assemblies

Kevin Kosar
R Street Institute 

Karen Kerrigan
Small Business & Entrepreneurship Council

Ryan Alexander
Taxpayers for Common Sense

Judson Phillips
Tea Party Nation

 

Photo credit: MoneyBlogNewz                                                          

More from Americans for Tax Reform


IRS Shortchanges Taxpayers $1.2 Million Due To Outdated Tech

Share on Facebook
Tweet this Story
Pin this Image

Posted by Sarah Caplin on Monday, February 6th, 2017, 10:00 AM PERMALINK

The IRS shortchanged taxpayers $1.2 million because they failed to address outdated computer systems, according to a report published by the Treasury Inspector General for Tax Administration (TIGTA).

Despite previous warning, the IRS failed to update computer program changes that were brought to their attention. After an extensive evaluation, TIGTA discovered multiple employee and processing errors within the IRS.

As a result of these errors, The IRS doled out $1.2 million less in a property tax credit than taxpayers were owed. As the report notes:

“The IRS incorrectly limited the Property Credit on 731 tax returns processed as of April 28, 2016, which caused these taxpayers to receive approximately $1.2 million less in credits than they were entitled to receive.”

Despite previous warning, TIGTA also found that computer programming errors are still causing some direct deposits to not convert to a paper check as required. As TIGTA noted:

“Our analysis of the 86 million deposit requests identified 5,605 deposit attempts totaling approximately $9.2 million that did not convert to a paper check as required.”

This is not an isolated incident. As the report notes, The IRS did not establish adequate processes to ensure that required documentation was associated and reviewed before processing claims and allowing credits:

“Our review also identified that employee errors resulting from the manual processing of these claims further delayed some taxpayer refunds. For example, TIGTA’s review of 6,300 electronically filed tax returns and 356 paper tax returns with Health Coverage Tax Credit claims totaling more than $20.8 million that were processed as of April 28, 2016, identified 450 (6.8 percent) returns that had a processing error.”

The IRS has proven itself to be inept with technology.  A 2015 report found that the agency was unable to upgrade all of its Windows workstations by the proper deadlines. In addition to this critical error, the IRS had not accounted for the location or migration status of approximately 1,300 workstations and upgraded only about one-half of its Windows servers in a five year time span. A separate report from 2016 found that the IRS wasted $12 million on an unusable email system because they purchased it without completing the required and necessary cost analysis.

 

 

Photo Credit: 
Saturnism

More from Americans for Tax Reform


Global Trade Accountability Act Reasserts Congressional Authority

Share on Facebook
Tweet this Story
Pin this Image

Posted by Natalie De Vincenzi on Monday, February 6th, 2017, 10:00 AM PERMALINK

The power to impose tariffs and regulate foreign commerce is not granted to the executive branch, but rather to Congress under Article 1, Section 8 of the United States Constitution. Presidents are granted the power to negotiate international trade agreements, but that does not include imposing tariffs. Yet over the years, Congress has consistently allowed the President to raise tariffs and restrict imports, heeding much of its congressional authority to the executive branch.

Congress must reassert its authority through the Global Trade Accountability Act, S. 177, introduced by Sen. Mike Lee (R-UT). This important piece of legislation will reinforce Congressional oversight and accountability of any trade decisions made by the Executive Branch.  Americans for Tax Reform along with 13 other free market groups wrote a letter to members of Congress urging them to support S.177, the Global Trade Accountability Act. Read the letter here or below.

Congress will be able to ensure that we don’t head down the path of protectionism we once historically did. There is a reason why our nation was set up to have checks and balances.  This piece of legislation is merely reaffirming the principles our nation has already established.

It is imperative that the U.S. pursues the best trade policy possible and strengthens international trade relations.  International trade is directly linked to millions of jobs across all 50 states. In 46 of the 50 states, trade-related jobs account for more than one-quarter of ALL jobs. In total, more than 1 in 5 jobs, or close to 41 million are reliant on trade. In fact, these workers earn 15-20 percent more than jobs in industries not tied to trade. Free trade is critical to the American economy and is an essential component to guaranteeing a high standard of living for all Americans.

Open Letter to the House and Senate:

Protect Families and Businesses from Unnecessary Tax Increases: Enact the Global Trade Accountability Act

 

February 2, 2017

 

To Members of Congress:

We the undersigned free market organizations, representing millions of hardworking Americans, urge you to support S. 177, the “Global Trade Accountability Act,” introduced by Sen. Mike Lee (R-UT). If enacted, the legislation would strengthen Congressional oversight and accountability of trade-related decisions made by the Executive Branch.

Article I, Section 8 of the United States Constitution gives Congress the authority to impose tariffs and regulate foreign commerce. Article II of the Constitution gives the President the power to negotiate international trade agreements. Over time, Congress has ceded much of its authority to establish and raise tariffs and restrict imports to the Executive Branch as long as certain conditions are met. This current arrangement gives the Executive Branch virtual carte blanche to raise tariffs or otherwise restrict imports in a manner that could trigger a costly and unnecessary trade war.

Consistent with Article I, Section 8 of the Constitution, and similar in process to the REINS Act, the Global Trade Accountability Act would require Congressional approval of proposed Executive Branch trade measures aimed at raising tariffs or restricting imports.  In short, it would allow Congress to assert its Constitutional authority over trade policy when appropriate.

Trade policy has been unfairly maligned in recent years, but make no mistake: protectionism has an ugly history in the United States. The Smoot-Hawley tariffs of 1930 deepened and prolonged the Great Depression. Since World War II, however, a bipartisan consensus emerged and the United States began working to liberalize foreign trade between nations. This has paid enormous dividends both domestically and abroad. Regrettably, the specter of protectionism is higher today than it has been at any point since the Depression. The Global Trade Accountability Act can prevent the United States from slouching toward protectionism. That is why we strongly urge you to pass S. 177, the Global Trade Accountability Act.

Sincerely,

Brandon Arnold, Executive Vice President
National Taxpayers Union

Grover Norquist, President
Americans for Tax Reform

Norm Singleton, President
Campaign for Liberty

David McIntosh, President
Club for Growth

Iain Murray, Vice President of Strategy
Competitive Enterprise Institute

Adam Brandon, President
FreedomWorks

Matt Kibbe, President
Free the People

Tom Giovanetti, President
Institute for Policy Innovation

Lisa Nelson, President
The Jefferson Project

Jerry Taylor, President
Niskanen Center

Lori Sanders, Outreach Director
R Street Institute

David Williams, President
Taxpayers Protection Alliance

Berin Szoka, President
TechFreedom 

Photo Credit: 
charlotte rose

More from Americans for Tax Reform


Governors Declare February 6th Ronald Reagan Day

Share on Facebook
Tweet this Story
Pin this Image

Posted by ATR on Monday, February 6th, 2017, 9:50 AM PERMALINK

Each year the Ronald Reagan Legacy Project sends requests to governors from all 50 states to issue a proclamation declaring February 6 "Ronald Reagan Day." This year, to celebrate Reagan's 106th birthday, 32 states -- three with Democrat governors -- signed official proclamations recognizing the late president.

Grover Norquist founded the Ronald Reagan Legacy Project in 1997. The project is committed to preserving the legacy of the 40th President of the United States throughout the nation and abroad, and also works to encourage the naming of buildings, roads, landmarks, and schools after the late President. There are currently 151 domestic dedications in 33 states and the District of Columbia, and 17 international dedications in nine countries. 

Norquist said: “Reagan reduced the size and scope of government, cut taxes for all Americans, and laid the foundation for economic prosperity. By the time he left office, America was freer, safer, and stronger in every way. And although he has been out of office for over a quarter of a century, he remains the leader his successors should emulate.”

The following 32 Governors have issued proclamations declaring today as Ronald Reagan Day in their states:

  • Alabama- Robert Bentley (R)
  • Arizona- Doug Ducey (R)
  • Arkansas- Asa Hutchinson (R)
  • California- Jerry Brown (D)
  • Colorado- John Hickenlooper (D)
  • Florida- Rick Scott (R)
  • Georgia-Nathan Deal (R)
  • Idaho- Butch Otter (R)
  • Illinois- Bruce Rauner (R)
  • Indiana- Eric Holcomb (R)
  • Iowa- Terry Branstad (R)
  • Kansas- Sam Brownback (R)
  • Kentucky- Matt Bevin (R)
  • Maine- Paul LePage (R)
  • Maryland- Larry Hogan (R)
  • Massachusetts- Charlie Baker (R)
  • Michigan- Rick Snyder (R)
  • Mississippi- Phil Byant (R)
  • Nevada- Brian Sandoval (R)
  • New Hampshire- Chris Sununu (R)
  • New Jersey- Chris Christie (R)
  • New Mexico- Susana Martinez (R)
  • North Dakota- Jack Dalrymple (R)
  • Ohio- John Kasich (R)
  • Oklahoma- Mary Fallin (R)
  • South Dakota- Dennis Daugaard (R)
  • Tennessee- Bill Haslam (R)
  • Texas- Greg Abbott (R)
  • Vermont- Phil Scott (R)
  • West Virginia- Jim Justice (D)
  • Wisconsin- Scott Walker (R)
  • Wyoming- Matt Mead (R)
Photo Credit: 
Marion Doss https://www.flickr.com/photos/ooocha/

Conservative Coalition to Congress: Pass Pro-Growth Tax Reform in 2017

Share on Facebook
Tweet this Story
Pin this Image

Posted by Alexander Hendrie on Monday, February 6th, 2017, 6:00 AM PERMALINK

Americans for Tax Reform President Grover Norquist, together with a coalition of 31 other conservative, free market leaders and organizations today urged Congress to pass pro-growth tax reform in 2017.

In the letter, addressed to House Speaker Paul Ryan (R-Wis.) and Ways and Means Chairman Kevin Brady (R-Texas), the coalition urges significant progress to be made in the first hundred days of the Trump administration:

“Given the importance of this issue, we believe it is imperative that the House of Representatives make significant progress in the first hundred days of the Trump administration toward passing comprehensive, pro-growth tax reform.

“Passage of tax reform that simplifies and updates the code is key toward encouraging economic growth, creating more jobs and higher wages, and promoting innovation and ingenuity. The release of your ‘Better Way’ tax reform blueprint last year was the first step in achieving this important goal, and we encourage you to continue working to ensure tax reform becomes a reality.”

Pro-growth tax reform should lower rates for families and businesses across the board, simplify the byzantine code, ensures small businesses and corporations can compete, and make lasting, permanent changes to law.

The full letter is below and can be found here.

February 6, 2017

The Honorable Paul D. Ryan          
Speaker of the House                     
U.S. House of Representatives      
H-232, The Capitol                          
Washington, D.C. 20515                

The Honorable Kevin Brady
Chairman, Committee on Ways and Means
U.S. House of Representatives
1102 Longworth House Office Building
Washington, D.C, 20515

Dear Speaker Ryan & Chairman Brady:

On behalf of the undersigned organizations, we write in support of your efforts to pass pro-growth tax reform into law in 2017.

Given the importance of this issue, we believe it is imperative that the House of Representatives make significant progress in the first hundred days of the Trump administration toward passing comprehensive, pro-growth tax reform.

Passage of tax reform that simplifies and updates the code is key toward encouraging economic growth, creating more jobs and higher wages, and promoting innovation and ingenuity. The release of your “Better Way” tax reform blueprint last year was the first step in achieving this important goal, and we encourage you to continue working to ensure tax reform becomes a reality.

As you know, it has been more than 30 years since comprehensive tax reform was last signed into law. Since then, our foreign competitors have drastically reduced their rates, simplified their codes, and updated their systems to be globally competitive. Meanwhile, our tax code has almost tripled in size and has failed to keep pace with the norms of global tax competition. 

Tax reform should be viewed as an opportunity to reduce rates for all taxpayers while also repealing many of the discriminatory and preferential provisions in the code in favor of a broader base. Lawmakers also ought to repeal a number of unnecessary taxes like the Death Tax and the Alternative Minimum Tax, which only add to the complexity of the system.

On the business side, tax reform should ensure our small businesses and corporations can compete against foreign competitors, while also ending the confusing, arbitrary system of depreciation in favor of immediate, full expensing of business investments.

Where possible, changes to the tax code should be permanent changes to law. When lawmakers have enacted short-term tax legislation in the past, it has inevitably come under threat in the future by legislators that want to increase the scope and size of government through higher taxes. In contrast, permanent legislation will give families and businesses much-needed certainty and will help contribute to a stronger economy.

Today, pro-growth tax reform is needed more than ever. It is imperative that lawmakers prioritize an overhaul of the tax code in 2017 and make significant progress in the first hundred days of the Trump administration. 

Sincerely,

Grover Norquist
President, Americans for Tax Reform

Pete Sepp
President, National Taxpayers Union

James L. Martin
Founder & Chairman, 60 Plus Association

Dan Weber
President, Association of Mature American Citizens

Lindsay Boyd
Policy Director, Beacon Center of Tennessee

Jim Waters
President, Bluegrass Institute for Public Policy Solutions (Kentucky)

Jeff Mazzella
President, Center for Individual Freedom

Tom Schatz
President, Council for Citizens Against Government Waste

Chip Faulkner
Citizens For Limited Taxation (Massachusetts)

Chuck Muth
President, Citizen Outreach (Nevada)

Katie McAuliffe
Executive Director, Digital Liberty

Palmer Schoening
Chairman, Family Business Coalition

Adam Brandon
President and CEO, FreedomWorks

Mario H. Lopez
President, Hispanic Leadership Fund

Carrie L. Lukas
Managing Director, Independent Women's Forum

Heather R. Higgins
President and CEO, Independent Women's Voice

Andrew Langer
President, Institute for Liberty

Dr. Robert McClure
President and CEO, The James Madison Institute (Florida)

Lisa B. Nelson
President and CEO, Jeffersonian Project

Brett Healy
President, The John K. MacIver Institute for Public Policy (Wisconsin)

Allen Gutierrez
National Executive Director, The Latino Coalition

Seton Motley
President, Less Government

Colin Hanna
President, Let Freedom Ring

Dee Hodges
President, Maryland Taxpayers Association ​

Brian McClung
Chair, Minnesota Center-Right Coalition

Jordan Harris
Executive Director, Pegasus Institute (Kentucky)

William Booher
Interim Executive Director, Pelican Institute for Public Policy​

 

Charlie Gerow
CEO, Quantum Communications (Pennsylvania)

Paul J. Gessing
President, Rio Grande Foundation (New Mexico)

Andrew Moylan
Executive Director, R Street Institute

Karen Kerrigan
President & CEO, Small Business & Entrepreneurship Council

David Williams
President, Taxpayers Protection Alliance

Photo Credit: 
https://www.flickr.com/photos/9731367@N02/

More from Americans for Tax Reform


ATR Supports the Agency Accountability Act (H.R. 850)

Share on Facebook
Tweet this Story
Pin this Image

Posted by Justin Sykes on Friday, February 3rd, 2017, 4:34 PM PERMALINK

Americans for Tax Reform this week released a letter to Congressional lawmakers urging support for Representative Gary Palmer's (R-Ala.) Agency Accountability Act (AAA), H.R. 850. 

Congress has granted agencies the authority to collect fines, fees, and other revenues outside of appropriated funds. While most of these funds are used to offset appropriations, a large portion are used by agencies to self-fund programs and operations outside of the normal appropriations process.

H.R. 850 would correct this discrepancy by requiring that all fines, fees, penalties, and other unappropriated proceeds, be directed to the Treasury, thus making them subject to the appropriations process. Agencies would still receive the funds required to exercise their standard functions, but those funds would now be placed back under Congressional oversight.

Below is the text of the letter, which can also be found here.

February 3, 2017

Dear Members of Congress,

Americans for Tax Reform (ATR) urges your support of H.R. 850, the Agency Accountability Act (AAA), introduced by Representative Gary Palmer (R-Ala.). Representative Palmer’s H.R. 850 would increase transparency and oversight of the funds collected by federal agencies and in doing so would help to restore Congress’s Article I authority by subjecting such funds to the appropriations process. 

Congress has granted agencies the authority to collect fines, fees, and revenue, with a portion of those funds being used to offset appropriations. However, some of these funds do not receive Congressional oversight as to how they are spent, leaving agencies to use those funds to finance programs and functions outside of the typical appropriations process. According to the Office of Management and Budget (OMB), in 2015 the federal government collected over $500 billion in user fees alone.

Congress’s “power of the purse” is thus being usurped as billions in annual revenue from fines and fees levied by federal agencies escapes the appropriations process. For instance, the Consumer Financial Protection Bureau (CFPB) and Financial Stability Oversight Council (FSOC) receive no appropriated funds from Congress. 

H.R. 850 would work to correct such discrepancies by requiring that all fines, fees, penalties, and other unappropriated proceeds, be directed to the Treasury, thus making them subject to the appropriations process. Agencies would still receive the funds required to exercise their standard functions, but those funds would now be placed back under Congressional oversight.       

H.R. 850 is a positive measure to increase Congressional oversight over the actions of federal agencies, thus improving the overall transparency and accountability of the federal government. 

I urge you to support and vote for H.R. 850, the Agency Accountability Act. 

Sincerely,                               

Grover G. Norquist                                                    

President                                                                     
Americans for Tax Reform

 

Photo credit: Jason Ippolito

  

More from Americans for Tax Reform


ATR Supports President Trump’s Plan to Halt DOL Fiduciary Rule

Share on Facebook
Tweet this Story
Pin this Image

Posted by Americans for Tax Reform on Friday, February 3rd, 2017, 1:34 PM PERMALINK

Washington – ATR President Grover Norquist issued the following statement this week in support of President Donald Trump’s announcement that he plans to halt the Department of Labor’s (DOL) Fiduciary Rule and his instruction to DOL officials to pursue regulatory action to undo the rule: 

“President Trump’s announcement this week that he will delay the DOL’s Fiduciary Rule and pursue regulatory action to undo the rule is a positive first step to protect low-and-middle income Americans, small businesses, and employees from increased retirement savings costs and reduced access to investment advice. 

“The Fiduciary Rule put forth by the DOL under President Obama was set to take effect in April of this year. The rule would have greatly reduced the ability of financial advisors to give advice to IRA and 401(k) holders, essentially putting the federal government between Americans and their retirement savings decisions.

“Estimates show the Fiduciary Rule could have disqualified up to 7 million IRA holders from investment advice, and reduced the number of IRAs opened annually by between 300,000 and 400,000.  

“I applaud President Trump’s leadership on this important issue and his willingness to work quickly to protect Americans and their retirement savings decisions. ATR looks forward to working with President Trump to undo this harmful and costly rule.”

 

Photo credit: Gage Skidmore

More from Americans for Tax Reform


President Trump Should Target Durbin Amendment Repeal

Share on Facebook
Tweet this Story
Pin this Image

Posted by Justin Sykes on Friday, February 3rd, 2017, 1:01 PM PERMALINK

This week President Donald Trump is set to order a regulatory rollback for the financial industry with his sights set on the Dodd-Frank Act. As the Trump Administration begins taking action to relieve consumers and businesses of the massive Dodd-Frank regulatory burden, the Administration should begin with one of the most onerous and failed Dodd-Frank policies – the Durbin Amendment.

Passed as part of the Dodd-Frank Act, the Durbin Amendment allows the government to set price controls on fees for debit card transactions. Prior to enactment of Durbin, these fees were not capped, and issuers of debit cards, such as credit unions and banks, were encouraged by free market competition to offer consumers benefits, such as free checking accounts.

However since Durbin was passed, not only have free checking accounts and other consumer benefits disappeared, but so has access to the banking system for many low-to-middle income Americans.

Before Durbin was enacted in 2009, 76 percent of banks offered free checking accounts. After Durbin was passed, that number fell to 45 percent in 2011, 39 percent in 2012, and an all time low of 37 percent in 2015. As a result of this decline, many low-to-middle income Americans have been pushed out of the banking system. This has led to over 1 million Americans becoming “unbanked.”

Yet the regressive trends resulting from Durbin are not the only concerning outcome. In passing Durbin, proponents of the Amendment argued that consumers would receive the benefits of merchants receiving a fee break on debt transactions. However, almost zero of those benefits were passed along to consumers. 

Studies show that instead of consumers receiving price breaks as a result of the fee cap, 77 percent of merchants have not changed prices, while 22 percent have actually increased prices. Such unfulfilled promises only harm, not help, American consumers.

The Durbin Amendment has not only failed at its stated goal of benefiting the American consumer, but has actually achieved the exact opposite. Instead of consumers seeing price cuts, prices have stayed the same or increased, and Americans have been driven out of the banking system leading to millions becoming unbanked.

The Durbin Amendment is failed policy. Hopefully for the millions of unbanked Americans and consumers seeing costs rise, President Trump will act to right the ship and target the Durbin Amendment for repeal, before the ill-fated consequences of this terrible policy become even worse. 

 

Photo credit: Gage Skidmore

More from Americans for Tax Reform


hidden
×