ATR Opposes DC Mayor Muriel Bowser's Proposed Tax Hikes

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Posted by Paul Blair on Monday, May 11th, 2015, 5:02 PM PERMALINK


As the Washington, DC City Council weighs Mayor Muriel Bowser’s 2016 budget, low and middle-income taxpayers should be wary. Last Friday, ATR testified before the Committee of the Whole to express our concerns regarding Bowser’s regressive tax hikes.

Among other things, the $12.9 billion budget submitted by Bowser raises the city’s sales tax from 5.75% to 6% despite growing city revenue and annual growth. This $22 million tax hike would adversely affect the city’s poorest, even if intended to fund government projects to their benefit. The city rejected this increase last year, when Bowser was on the Council.

“It’s the most regressive kind of tax . . . and besides, you save raising the tax for the rainy day,” said D.C. Council Chairman Phil Mendelson (D), noting that local revenue is projected to grow to more than $7 billion next year, an increase of $185 million, or nearly 3 percent. “When revenues are growing by 3 percent, you don’t need to be raising taxes.”

Another tax increase contained in the budget targets smokers looking for an effective way to quit. Bowser's 70% tax on electronic cigarettes (e-cigs) would constitute more than 1200% increase on the products currently subjected to the city’s 5.75% sales tax. This tax on quitting smoking is misguided and will result in closed businesses and a loss of city jobs.

That testimony can be found in its entirety here:

Chairman Mendelson and Members of the DC City Council,

On behalf of Americans for Tax Reform, thank you for providing us the opportunity to testify before the Committee of the Whole this morning.

Americans for Tax Reform is a non-profit taxpayer advocacy organization based here in Washington, D.C. that has existed since 1985. Last year, ATR was happy to support the historic tax reform package passed into law by the Council, which broadened the base of taxable services, reduced tax rates for individuals and businesses and took a step in the right direction towards making DC more competitive.

Unfortunately, this year’s Budget Request and Support Acts take a step in the wrong direction, particularly targeting low and middle-income consumers with higher, regressive taxes.

First, the proposal to raise the sales tax to 6%. District revenues are growing. This happens in periods of natural and competitive growth and makes this tax hike unnecessary. To target those who can least afford it with $22 million in higher taxes on the products they purchase just to get by flies in the face of last year’s tax reform package aimed at encouraging people to live, stay, shop, and move into the District.

Second, the proposal to raise taxes on electronic cigarettes and vapor products contained in the Vapor Products Amendment Act of 2015. Last year this Council changed the way DC taxes tobacco based on a recommendation from the DC Tax Reform Commission and the Tobacco Free Coalition. Electronic cigarettes and vapor products were exempt from being defined as tobacco for good reason. They’re tobacco-free and they’re effective smoking cessation products that stand to save thousands of lives in DC and millions of tax dollars.

The massively unjustifiable 70% tax on the wholesale cost of vapor products will guarantee that the poorest DC residents continue smoking combustible tobacco cigarettes. And while projections assert that this new tax will result in $382,000 in revenue next year, that is extremely unlikely because it assumes two things.

First, that consumers who have and are looking to make the switch from tobacco to vapor products will not simply buy the products in Maryland or Virginia, where the products are taxed at 6 percent in retail locations.

Second, that DC vapor product sales won’t go online where the District does not have the authority to tax or regulate sales to consumers.

Both assumptions are wrong and will result in less revenue than anticipated and less sales tax revenue from products currently taxed at 5.75 percent in DC retail locations. For products costing as much as $300, not even wealthy consumers will purchase the products in DC retail locations.

There are real, operational, new businesses in this City who stand to be put out of business with this tax hike. While they can speak better to the new employees they’ve hired, the rent, income, and sales taxes they’re paying, I wanted to echo their concerns. Increasing the cost of vapor products by 70 percent will make their sales no longer viable in DC. These shops may shut down and the city’s tax policies will discourage new shops from opening. This budget stands to kill current and future jobs.

The Director of the Food and Drug Administration (FDA) Center for Tobacco Products remarked last year, “If we could get all of those people to completely switch all of their cigarettes to noncombustible cigarettes (electronic/vapor), it would be good for public health.” Does this Council disagree? Should we not create tax policy that facilitates and encourages consumers switching to tobacco-free technology products without placing an undue and costly burden on them?

Even as the FDA considers a set of guidelines on the industry, they admit vapor products are likely good for public health. That’s precisely why vapor products may save the District millions of tax dollars. The cost borne by taxpayers for the use of tobacco by recipients of Medicaid far outweighs the revenue generated from cigarette sales or tobacco settlement payments by an astounding 200 percent, according to a recent study by State Budget Solutions. Vapor products, used by lower and middle-income consumers on Medicaid will bring down the long-term health care costs paid for by the rest of District taxpayers. 

There’s a reason every state in the nation that considered taxing vapor products like tobacco in 2014 failed. Politicians in both parties agree that vapor products may just accomplish what lawmakers have failed to do for decades: ending tobacco cigarette use, as we know it. Any policies, including higher taxes that make it more expensive for residents to make the switch to far healthier alternatives, should be rejected.

We urge the City Council to reject the Mayor’s tax hike proposals.​

 

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Crystal Nicole Davis

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Montana Continues Trend on Asset Forfeiture

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Posted by Jorge Marin on Monday, May 11th, 2015, 4:22 PM PERMALINK


Montana can count itself in the growing group of states taking on civil asset forfeiture less than a month after New Mexico passed its lauded comprehensive reform. And though Montana’s legislation is not as exhaustive as New Mexico’s, it is nevertheless a giant step in the right direction.

Civil asset forfeiture is a controversial proceeding in which law enforcement authorities are allowed to confiscate property suspected of being used in a crime without a warrant or conviction. Property owners are then left with the options of hiring expensive legal help (for protracted civil proceedings) or writing off the lost property.

The property is then kept by the law enforcement agency that performed the seizure and can be used at their discretion: some argue that this creates an improper incentive for the agencies.

The new regime in Montana does away with the warrantless forfeiture component of the problem. HB 463—the enacted measure—will require a criminal conviction before the property is forfeited. Meaning that in order for the police to keep and use the money, they have to prove its connection with the crime.

The burden of proof on the government, and increasing the standard to “clear and convincing evidence,” gives innocent property owners expanded protections from overzealous forfeiture programs.

Civil asset Forfeiture has seen a dramatic increase of attention from both state legislators and the federal government. Montana has proven that it is prepared to put the interests of its citizens first and foremost. Hopefully this positive trend will continue to expand Fifth Amendment rights across the nation.

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Cuksis

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bigcoffinhunter007

there's always your underwater submarine,long,hard and full of seamen.

jack anderson

There go the pension budgets.

hammerstamp

Once again Montana, well done!


Cameron’s Tax Pledge “had significant cut-through,” says Founder of Britain’s TaxPayers’ Alliance

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Posted by John Kartch on Friday, May 8th, 2015, 12:43 PM PERMALINK


The founder of Britain’s leading taxpayer advocacy group says David Cameron’s tax pledge against increases in the income, VAT, and national insurance taxes “had significant cut-through.” 

Announcing the tax pledge in an April 29 address, Cameron asked the voters:

When you're standing in the polling booth, ask yourself: on the things that matter in your life who do you really trust? When it comes to your tax bill, do you trust the people who have taxed you to the hilt when they were in power and still haven't come clean about the taxes they want to increase next time round? Or do you trust the Conservatives, who have cut income taxes for 26 million people and who will cut your taxes again next time.

Following the Conservative victory, Matthew Elliott — Founder of the TaxPayers’ Alliance — said:

A month out from Election Day, Prime Minister David Cameron's campaign was widely deemed to be faltering - the Conservative Party hadn't overtaken the centre-left Labour Party in the polls, and there was a feeling that a strong, believable case needed to be made to convince a skeptical electorate that his Government deserved re-election. A key announcement was the Tax Pledge - a pledge not to raise the key taxes on ordinary, hard-working families in the UK. This Pledge had significant cut-through, because it proved to voters that the Conservatives' plans for taxation were real, and concrete, as opposed to the illusionary promises from the other parties. Now the Prime Minister has an overall majority in Parliament, this Pledge will become an important part of Britain's fiscal debate. It's certainly works for taxpayers in the US, and it'll work here in Great Britain. 

NRO’s John Fund agrees:

This British election was supposed to revolve around post-Thatcher worries about income inequality and resentment against the rich. A recent study by the London School of Economics found that 62 percent of Britons felt inequality had reached    unsustainable levels and that 74 percent believed the rich should pay more taxes. Bart Cammaerts, the author of the study, wrote that it showed the country moving toward  'a renewed politics of redistribution.'

Goodbye to all that, for this election at least. If anything, British voters were motivated to turn out in support of Prime Minister David Cameron’s last-minute support of a version of America’s famous anti-tax pledge. Just last week, Cameron pledged that if the voters gave him a second term, he would push legislation blocking any increases in Britain’s national-insurance, income, or value-added taxes (the lattermost, a form of sales tax). 'We know it’s your money, not government money. You’ve worked for it, you’ve earned it, you should be able to keep it,’ he told voters.

Finally, in an item titled U.K. Conservatives’ Tax Stances Could Resonate in U.S., Politico Pro’s Katy O’Donnell writes: 

Taxation was a prominent theme in the election: Conservative Chancellor George Osborne pledged to cut taxes for low-income workers and, late in the campaign, Prime Minister David Cameron promised a five-year 'tax lock' — legislation banning any increases to the country’s Value Added Tax, income taxes and national insurance taxes. A Labour Party spokesman dismissed the idea as a 'last-minute desperate gimmick.'

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MaxineH20Sux

When USA voters are at the booth I hope they ask themselves if they are better off than they were 8 years ago...

Jack Meeoff

It seems as thought the worlds leftist have lied enough......here and in Great Britain. Of course the Greeks STILL are clueless.

Valmont

But without new taxes, how can the UK continue to indulge their luxury taste for importing demanding Third World parasites?


The Obama Administration's Internet Take Over

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Posted by Katie McAuliffe on Friday, May 8th, 2015, 12:17 PM PERMALINK


Chairman Wheeler’s recent speech at his alma matter, Ohio State University, did not tell the full story about the Federal Communications new Open Internet Order.

The Open Internet Order will increase costs, decrease investment, and increase regulatory uncertainty. Put simply you are going to see costs rise and choices diminish.

Chairman said that special interests in Washington would not sway his decisions, but Washington DC special interest did contribute a great deal to his transition away from light-touch 706 regulations and heavy-handed Title II regulation.  

The Ford Foundation and Open Society Foundations (funded by billionaire George Soros) were huge funders of the pro-Internet- regulation organizations.  In its Open Internet Order, the FCC cited Soros and Ford Foundation funded groups 206 times. This is clearly disproportionate to free-market proponents who were cited five times (four citations to TechFreedom and one to the Free State Foundation).

Its hard to say whether the FCC even considered other points of view.  When the FCC asked for public comments on its proposal in May 2014, the proposal focused on Section 706 regulation, not Title II.  This gives opposing views no ability to submit research and comments about Title II effects, when they believe the question is something completely different.  As a result, many experts believe the FCC could have violated the administrative Procedures Act by failing to give adequate notice of the rules it adopted.

When Wheeler says “Open Internet,” that’s code for public utility regulation. The Chairman will try to tell you different, but broadband reclassification as a Title II telecommunications service by definition equals rate regulation.  Plus, under the FCC’s general Internet conduct standard, the FCC explicitly invites consumer rate complaints, which upon receiving these complaints, the FCC welcomes the opportunity to engage in rate regulation to determine whether the rates charged are ‘just and reasonable’.

Chairman Wheeler would have you believe that Title II is some kind of Net Neutrality light-touch regulation. Title II is not Net Neutrality, which includes the basic principles of no blocking, non-discrimination of content, and transparency.  It is Public Utility regulation established in the 1930s.

Wheeler positions our choices as Title II public utility style regulation, or “we can have the people who operate the networks making the rules for the Internet.” This is a false choice.  The FCC had a choice to implement a basic set of rules using light-touch regulation under Section 706, or an onerous set of rules under a Title II framework. It chose the latter.  The FCC’s original net neutrality rules were based on Section 706 authority – not Title II.

He says, “we can have an Open Internet and light-touch regulation that encourages innovation and consumer choice.”  We can have that, but we won’t because the regulations the FCC has passed will discourage innovation. With its 1934 monopoly era rules and micromanagement practices, with many regulations yet to be determined, nothing about Title II is ‘light-touch’.  It is heavy-handed and onerous regulation of one of the most dynamic and innovative inventions in history.

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Update: MS-01 Special Election Update

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Posted by John Beattie McEwan, Adam Radman on Thursday, May 7th, 2015, 5:33 PM PERMALINK


Americans for Tax Reform recently released an updated list of U.S. congressional candidates in Mississippi's first district who have signed the Taxpayer Protection Pledge. These candidates have made a written commitment to their constituents to "oppose and vote against higher taxes." The list of candidates who have signed the Taxpayer Protection Pledge is as follows:

Candidates

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Oklahoma Slashes Mandatory Minimums

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Posted by Jorge Marin on Thursday, May 7th, 2015, 1:26 PM PERMALINK


This week Oklahoma governor Mary Fallin signed HB 1518, a bill to reform the state’s minimum mandatory sentencing guidelines.

Far from giving a break to dangerous offenders, the Safety Valve Act gives judges discretion to give low level offenders less severe sentences on a case-by-case basis. Additionally, the act allows judges to place certain offenders into the mental health or drug treatment systems.

By allowing for this kind of sentencing nuance, the Sooner State hopes to rein in one of the highest incarceration rates in the nation. At 659 prisoners per 100,000 residents, Oklahoma has the third highest proportion of its population behind bars of any state.

There is a growing chorus of Red states reforming their prison systems. When Texas passed its own prison reforms in 2007, it saw a decline in their prison population, a massive decline in their crime rate, and savings of $2 billion. Not a bad start from any perspective. Likewise, Georgia saved hundreds of millions after its own reforms.

Combined with the recent easing of occupational licensing rules, Oklahoma now joins these states in the front lines of criminal justice reform.  In her statement, Fallin assured Oklahomans that “Violent criminals will continue to be incarcerated, but the fact is that one in eleven Oklahomans serve time in prison at some point in their lives,” underscoring the urgency of prison population reduction.

Many of our current inmates,” Fallin continued, “are nonviolent offenders with drug abuse and alcohol problems; others have mental health issues. For some of these offenders, long sentences in state prisons increase the likelihood of escalated criminal behavior. This bill gives our judges the freedom they need to divert people who need treatment, rehabilitation and supervision to the appropriate facilities and programs.

Americans for Tax Reform would like to congratulate the Oklahoma legislature, which passed the reform by overwhelming margins, for their historic success. Hopefully, more states will follow suit as the modernization of America’s prisons continues.

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Carly Fiorina Signs Taxpayer Protection Pledge to the American People

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Posted by ATR on Thursday, May 7th, 2015, 6:45 AM PERMALINK


Carly Fiorina, a candidate for the presidency of the United States, has signed the Taxpayer Protection Pledge to the American people. 

The pledge is a written commitment to the American people to “oppose and veto any and all efforts to increase taxes.” 

Previously, Fiorina signed the Pledge as a U.S. Senate candidate from California in 2010. “Carly has a long history of supporting and defending taxpayers,” said Grover Norquist, president of Americans for Tax Reform.

Among declared 2016 GOP presidential candidates, Fiorina joins Marco Rubio, Rand Paul, and Ted Cruz in signing the Pledge.

ATR has shared the Pledge with all candidates for federal office since 1986. In the 114th Congress, 49 U.S. Senators and 218 members of the U.S. House of Representatives have signed the Pledge. On the state level, 13 incumbent governors and approximately 1,000 incumbent state legislators have signed the Pledge.

In 2012, all candidates for the Republican nomination for president signed the Taxpayer Protection Pledge, with the lone exception of former Utah Gov. Jon Huntsman.

“By signing the Taxpayer Protection Pledge to the American people, Carly Fiorina continues to protect American taxpayers against higher taxes,” said Grover Norquist, president of Americans for Tax Reform. “Fiorina understands that government should be reformed so that it takes and spends less of the taxpayers’ money, and will oppose tax increases that paper over and continue the failures of the past."

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IRS Refuses to Fire Employees Who 'Willfully Violate Tax Law"

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Posted by Alexander Hendrie on Wednesday, May 6th, 2015, 5:04 PM PERMALINK


The IRS is failing to fire employees who have willfully violated tax law, according to a report released today by the Treasury Inspector General for Tax Administration (TIGTA).

Under the Restructuring and Reform Act of 1998 (RRA 98) the IRS is legally required to terminate employees that have committed acts of misconduct including willful violations of tax law. However, TIGTA’s review of IRS practices found that the agency is failing to terminate these employees despite the serious nature of their transgressions. As the report states:

“Our review of a judgmental sample of 34 cases found that some employees, who management had concluded were not credible, with significant and sometimes repeated tax noncompliance issues, or a history of other conduct issues, were not terminated.”

In fact, as the reports notes, only a fraction of the employees found to have willfully violated tax law were fired. The majority of employees received far more lenient punishments:

“More than 25 percent, or 400, of the willful employee tax noncompliance cases resulted in termination of the employee…. More than 60 percent of employees, or 960, with willful tax noncompliance cases had their discipline mitigated to a penalty lower than termination.”

If that were not bad enough, many of these same employees received bonuses and promotions from the IRS within a year after their noncompliance case. As the reports says:

“In addition to not being terminated for willful tax violations, some IRS employees also received promotions, performance awards, and permanent pay increases within one year after their willful tax noncompliance case was closed.”

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Americans for Tax Reform’s Katie McAuliffe Appointed to FCC Consumer Advisory Committee

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Posted by Dorothy Jetter on Wednesday, May 6th, 2015, 3:37 PM PERMALINK


Katie McAuliffe, Federal Affairs Manager, Americans for Tax Reform has been appointed to the FCC Consumer Advisor Committee.  According to the FCC:

“The mission of the Committee is to make recommendations to the Commission regarding consumer issues within the jurisdiction of the Commission and to facilitate the participation of consumers (including underserved populations, such as Native Americans, persons living in rural areas, older persons, people with disabilities, and persons for whom English is not their primary language) in proceedings before the Commission.”

As a staff member at Americans for Tax Reform, McAuliffe understands the important roles of free market economics as they apply to evolving technology.  She looks forward to ensuring these ideas are well represented among her colleagues on the Consumer Advisory Committee.

 

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The New Budget: Hits and Misses

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Posted by Jorge Marin on Wednesday, May 6th, 2015, 3:29 PM PERMALINK


Last week congressional Republicans reached an agreement on the budget for the year going forward. The proposal calls for reforms to struggling entitlement programs, clamps down on inefficient and ineffective government programs, and lays the groundwork for strong economic growth.

The most important aspect of any budget is whether it is balanced. The FY2016 conference agreement brings spending restraint to the federal government and creates a $32 billion surplus by 2024—meanwhile no new taxes are levied on individuals. This stands in stark contrast to the $1.44 trillion in new taxes requested in the president’s FY2016 budget.

The new Republican budget agreement also maintains the most important conservative victory in the last five years: the sequester caps. The FY2016 Budget maintains the spending restrictions mandated in the Budget Control Act of 2011, ensuring the continuation of the savings from discretionary spending. Here again the Republican budget agreement stands in stark contrast to the White House budget, which ignores 2011 sequester spending caps and raises spending through misleading promises, the Senate budget abides by federal law. It is important to keep these caps in place; caps that have stabilized federal spending since 2011 and will lead to $1.79 trillion in savings through 2021.

Moreover, the economic benefits of the agreement would help spur our sluggish economy. In total, $400 billion would be added directly into the economy over the next ten years, according to The Congressional Budget Office. After years of lackluster growth, it is time to enact fiscal policies that put the economy back to work.

Unfortunately, not everything about the deal is perfect. In order to appease some of the more hawkish legislators, the Overseas Contingency Operations Fund (OCO) has gotten a very generous increase. OCO is the fund that the pentagon uses to fund overseas engagement…theoretically. Though the Pentagon has requested $50.9 billion for OCO, the budget sets aside $96 billion for the same fund. This extra money will go to pad military budgets without ensuring an equivalent offset somewhere else in the budget.

Examples of OCO’s largesse abound. FY2016 has over $500 million set aside for construction projects that would only be relevant to fighting ISIS if the Air Force were to literally drop buildings (presumably flown over by multiple F-35s) on top of Mosul.

Using the Overseas Contingency Operations Fund as a way to skirt the Budget Control Act’s caps is disingenuous and unfair to taxpayers. Fortunately, there are redeeming qualities to be found in next year’s budget.

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