ATR Supports Legislation to Repeal the Death Tax


Posted by Ryan Ellis on Tuesday, March 17th, 2015, 3:52 PM PERMALINK


This month, the House Ways and Means Committee will consider H.R. 1105, the “Death Tax Repeal Act of 2015,” sponsored by Congressman Kevin Brady (R-Tex.). This legislation will put an end to the immoral practice of the federal government demanding hard-earned taxpayer money after a family loses a loved one. ATR supports this bill and urges all Members of Congress to support it.

H.R. 1105 will permanently kill the Death Tax. The Death Tax has a top federal rate of 40 percent on estates and the tax is a major reason that Americans are unable to pass along farms and small businesses to the next generation.

The Death Tax makes up a miniscule sliver of federal revenue and so repealing the tax will have an almost unnoticeable effect on the federal budget. In addition, a study by the Joint Economic Committee found that the Death Tax hurts economic growth and discourages savings and small business growth. 

The Death Tax places an unfair and unnecessary burden on American families in the event of a tragedy.  H.R. 1105 will repeal this ridiculous tax and help provide families peace of mind in a difficult time.

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Don't Kill The Sequester

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Posted by Jorge Marin on Tuesday, March 17th, 2015, 9:45 AM PERMALINK


Congress is at a pivotal crossroad. The chairmen of the House and Senate Budget panels are preparing to unveil their plans for the nation’s budget this week; at stake are the $1.79 trillion dollars in savings scheduled through 2021.

On the one hand, there are the members of Congress who would like to get rid of the sequester caps on military spending; on the other are the legislators who wish to maintain the 2011 Budget Control Act (BCA) intact.

It looks like the Republican leadership will opt to preserve the budgetary restraint and save the American taxpayer trillions of dollars in the near future. Yes, that is correct, trillions. It all has to do with the stunning flat-line which the Sequester imposes on discretionary spending.

As a way to keep the folks on The Hill accountable for spending, the BCA placed hard caps on the amount of money that could be allocated for certain budgetary items. These were to come into place if lawmakers were unable to come to an agreement over a way to reduce federal deficits. Unfortunately (or fortunately, if you are content with the Sequester), lawmakers failed to do so and the result was a sudden reduction in discretionary spending for the ten years following the BCA’s passage in 2011.

CBO projections reveal the effectiveness of the Sequester in halting spending:

                                               (Source: Congressional Budget Office)

Over time, discretionary spending was projected to continue rising in perpetuity; but thanks to the BCA, discretionary spending was brought under control.

That is one third of the national budget stabilized with no tax hikes needed. What is even more miraculous is that all of this was achieved while Republicans controlled only one chamber in Congress.

This key victory has already saved taxpayers $670 billion, but according to CBO projections an additional $1.79 trillion dollars in savings is set to occur through 2021. In other words, the best of the benefits is yet to come.

At the current trend line, the United States is slated to spend a record low amount on discretionary spending as a percentage of GDP at 5.5 percent by 2021. Overall this must be considered the seminal achievement of the conservative movement of the last five years. This gives our national finances breathing room for legislators to look for further reforms down the line.

Should Congress turn away from the Budget Control Act, they would trade $1.79 trillion dollars over the next five years for a couple billion dollars now. Let us hope that Congress has better math sense than to allow for that to happen.

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dannymac15_1999

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MS-01: Boyce Adams Makes Written Committment to Oppose Higher Taxes

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Posted by John Beattie McEwan, Adam Radman on Monday, March 16th, 2015, 3:01 PM PERMALINK


Americans for Tax Reform (ATR) congratulates Mississippi small business owner Boyce Adams for signing the Taxpayer Protection Pledge, which is a written commitment to the people of Mississippi to “oppose any and all efforts to increase the marginal income tax rates for individuals and/or businesses and oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates." Adams is running in the May 12 special election to fill the seat vacated by the recently deceased Alan Nunnelee in Mississippi’s first congressional district.

Candidates running for office like to say they will not raise taxes, but often turn their backs on the taxpayer once elected. The Pledge requires these candidates to put their rhetoric in writing and provide an additional layer of accountability to the taxpayer.

ATR has offered the Pledge to all candidates for federal office since 1987. Currently, 48 U.S. Senators and 219 members of the U.S. House of Representatives have signed the Pledge. Additionally, fourteen incumbent governors and over 1,000 state legislators have signed the Pledge.

I want to congratulate Boyce for taking the Taxpayer Protection Pledge. The American people are tired of the tax-and-spend policies coming from Washington and they are looking for solutions that create jobs, cut government spending, and get the economy going again,” said Grover Norquist, president of ATR.

I challenge all candidates for federal office to make the same commitment to taxpayers by signing the Taxpayer Protection Pledge today,” Norquist continued.

ATR will continue to follow this race closely and will provide additional updates as more candidates sign the Pledge.

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ATR Supports Mid-Level Dental Reform in Texas

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Posted by Paul Blair on Monday, March 16th, 2015, 11:17 AM PERMALINK


While the states have grappled with implementing a wide range of federal health care mandates, questions about rising costs the next steps in health care reform have lingered in Washington. Fortunately, states don't have to wait to act.

In what has been called a "big idea" for social change, a new category of mid-level dental practitioners known as "dental therapists" may hold the key for providing dental services in underserved and rural populations. Like hygienists, dental therapists work under the supervision of dentists with collaborative agreements that allow them to provide an expanded list of services to patients. Governor Paul LePage and former Governor Tim Pawlenty, both Republicans, already signed legislation permitting the creation of these mid-level practitioners in Maine and Minnesota. 

Americans for Tax Reform supports this bold type of dental care reform because it, at no cost to taxpayers, stands to expand health care to underserved populations in the United States. 

Two bills in Texas would tear down an unnecessary barrier created by protectionist government rules by permitting small business to hire trained "Dental Hygiene Practitioners" to aid in their dental practices. ATR president Grover Norquist recently sent a letter to members of the Texas House, Senate, and Lt. Gov. Dan Patrick in support of Senate Bill 787 and House Bill 1940. 

Click here to read the letter. 

As Grover Norquist notes,

"Dentists who want to expand their practices to include educated and qualified mid-level practitioners should be free to do so. Innovative ideas like this have faced intense opposition but are very similar to the fights that took place decades ago with the emergence of nurse practitioners. Physicians began working and collaborating with nurses who had clinical experience to fill a void left by specialization in the medical field. Today, nurse practitioners provide equivalent or superior care to that provided by physicians. SB 787 and HB 1940 responsibly follow the nurse practitioner model for dental practices." 

This is a free market health care solution that utilizes the desire and qualifications of trained professionals to provide much needed dental care to underserved populations without raising costs on taxpayers. It would be irresponsible for the state to stand in the way. 

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The Grover Norquist Show: Conceal Carry Permits Key to Low Crime

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Posted by Alexander Hendrie on Friday, March 13th, 2015, 5:15 PM PERMALINK


In the latest edition of the Grover Norquist Show, ATR President Grover Norquist discusses criminal justice reform and the role of second amendment rights in reducing crime.

In the podcast, Norquist points out the link between states that have higher numbers of conceal carry permits and lower violent crime. Ideally, criminal justice should be not just about arresting individuals who have already committed a crime, but also in ensuring a climate that can prevent crimes from occurring in the first place. Conceal carry is a smart, efficient, and low cost way to reduce crime.

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Gage Skidmore

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ObamaNet Assaulting the Free Market

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Posted by Katie McAuliffe on Friday, March 13th, 2015, 4:32 PM PERMALINK


Statement of American's for Tax Reform President, Grover Norquist, on the Federal Communications' Title II utility regulation for the Internet:

While it will take long enough to read the 84 pages of dissent, let alone the more than 300 page rule making from the Federal Communications Commission, it is clear that as Commissioner O'Rielly says, this prophylactic approach is definitely "guilt by imagination."

As we pour over this document we are sure to find a number of things where the public did not have the opportunity to provide comments.  This is not the so called "net neutrality" of 2006 or even of 2014.  This is not Title II as passed by Congress for rotary phones.  We do not support either of these approaches, and have voiced our opposition in the FCC's open comment period.  However, we have never had the opportunity to comment on the FCC's new definition of either of these concepts.  That in itself is against the law.
 
Like its handmaidens Obamacare and Dodd-Frank, the true ugliness of this assault on the free-market will only become known as we plunge deeper and deeper into its stormy depths.

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Obama 2008 Presidential Campaign

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Double Taxation on Corporate Profits Hurting U.S. Competitiveness

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Posted by Ryan Ellis on Friday, March 13th, 2015, 4:06 PM PERMALINK


A report compiled by Ernst & Young comparing U.S. corporate tax rates to the rest of the developed world has found that America’s inefficient corporate tax regime is hurting U.S. competitiveness – namely through double taxation on economic decision making.

According to the report, the U.S. has the second highest top integrated tax rates amongst 38 developed countries, including the 34 members of the Organisation for Economic Development (OECD) along with Brazil, Russia, India, and China (BRIC). The report calculates integrated tax rates by combining corporate-level taxes with investor-level taxes on dividends and capital gains at national and subnational level.

Most developed countries (but not the U.S.) provide some form of relief from double taxation on corporate profits. Double taxation is a drag on the economy because it distorts important economic decisions, including discouraging capital investment which can lead to the misallocation of resources. It also encourages firms to favor debt over equity financing which can leave them vulnerable during periods of economic weakness.

The 2001/2003 Bush Tax cuts were designed to lessen the impact of double taxation in the U.S. through reduced dividend and capital gains rates and put the U.S. on nearly equal footing with competing nations. Since then, other nations have further decreased their tax burden on businesses, while the 2012 fiscal cliff tax hikes resulted in the US integrated tax rate reaching second highest amongst developed nations.

Several reforms have been proposed to reduce the dividend and capital gains tax burden including a 2014 proposal by Former House Ways and Means Committee Chairman Dave Camp and the White House Budget for FY 2016. Unfortunately, none of these proposals would reduce integrated tax rates to levels below the average among OECD and BRIC countries.

The recently released Rubio-Lee tax plan would go some way to placing the U.S. at the forefront of international competiveness. Not only would this plan implement a zero percent tax rate on capital gains, dividends, and interest, it would also reduce the corporate tax rate to 25 percent. In today’s globalized economy, it is vital that a tax code is internationally competitive and this reform would help achieve that.​​

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Lookout! Congress Considering Increasing the Cost of Flying

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Posted by Sven Werner, Chris Prandoni on Friday, March 13th, 2015, 3:19 PM PERMALINK


In about 200 days, Congress will be reauthorizing the Federal Aviation Administration (FAA). Why should you care? Because a Congressional coalition is forming to increase passenger fees to pay for airport projects.

These potential tax increases would significantly affect passengers.

Taxes, 17 of them, already make up 21% of a plane ticket’s price. Proponents of this tobacco-like level of taxation argue that these passenger fees are necessary to support airport spending. This argument presumes that airports need the money, that these investments would not occur without government transfers. However, airports currently have $11 billion in cash holding which is around 357 days of liquidity.

Not only are airports flush with cash, they have also spent $70 billion on completed, underway, or approved airport capital projects at the nation’s 30 largest airports since 2008. Since 2000, airports revenue has increased by 65% percent to $24.5 billion in 2013. Yet, many airports are claiming poverty and that they need even more money from airlines and passengers.

In order to achieve this end, these spending interests are looking to increase the Passenger Facility Charge (PFC) cap. A one-dollar increase in the PFC cap would lead to $700 million in extra costs for passengers every year. 

Unsurprisingly, this idea isn’t a popular one: 87% of voters already think the PFC is too high; 82% of people oppose the almost doubling of the PFC and the automatic increases that come with indexing the PFC to inflation.

Most airport revenue streams are at a record high, so it’s hard to justify a tax increase. Since the federal aviation taxes have tripled since 1972 – and since 2000 there has been a 52% increase on a per passenger basis since 2000 – Congress should consider reducing taxes for passengers, not increasing them.

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Robert Couse-Baker

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Samuel Clemmons

Who are the congressman in the coalition? What is the coalition--is it new legislation?


Critics of Rubio-Lee Tax Plan Rely on Outdated Assumptions

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Posted by Alexander Hendrie on Friday, March 13th, 2015, 2:08 PM PERMALINK


Earlier this month, Senators Marco Rubio (R-Fla.) and Mike Lee (R-Utah) released their plan to reform the tax code based on two guiding principles - pro-growth and pro-family. While the plan has earned praise from a diverse range of experts, critics have resorted to using outdated models to undermine the proposal.

One line of opposition to the Rubio-Lee tax plan is based on skepticism that it will not lead to the growth that its authors promise. However, an analysis by the Tax Foundation debunks the claims made by critics such as William Gale of the Tax Policy Center. As the analysis states:

Gale notes the study's estimate that a revenue-neutral switch to a flat-tax - a type of consumption tax - would "raise GDP by 4 percent over a decade." However, under assumptions closer to ours, the same study finds a flat-tax would raise GDP by 5.9 percent over the long-run.

As the analysis by the Tax foundation notes, the Auerbach-Kotlikoff model used by critics assumes a closed economy, which is unrealistic in today’s globalized economy:

The 2001 Auerbach-Kotlikoff model assumes a closed economy, i.e. we have no saving abroad to bring home and foreigners can't send more of their saving here to help finance additional U.S.-based capital. That's a major, unrealistic constraint. Today's economy is globalized; trillions of dollars of investment flow between the U.S. and the rest of the world. We assume an open economy where shifts in our own and foreign saving to the U.S. finance the build-out of capital.

In fact as the Tax Foundation notes, Rubio-Lee will increase growth by 15% over 10 years, will reduce the tax burden placed on families, and will encourage growth. As the analysis states:

The Rubio-Lee plan is not revenue-neutral. It is a big tax cut, to the tune of $414 billion a year or 2.2 percent of GDP, according to our static estimate. Such a tax cut would raise GDP by about 6.6 percent, according to empirical estimates by leading economists such as Christina Romer, former chair of President Obama's Council of Economic Advisors. Add that to the Auerbach-Kotlikoff 9.4 percent estimate of a revenue-neutral tax reform and you get 16 percent growth in GDP - more than our 15 percent estimate of the Rubio-Lee plan.

In fact, as ATR’s Ryan Ellis notes, this plan “has a little something for everyone” – families, small businesses, and savers. In doing so, Rubio-Lee presents itself as smart proposal that can appeal to a broad base of taxpayers.

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ToddTexas

What are they waiting for? Anything which lessens money to Washington D.C. Is a winner in my book.


Medicare Reform to Be Voted on by U.S. House of Representatives


Posted by Ryan Ellis on Thursday, March 12th, 2015, 7:15 PM PERMALINK


Reports are out that the U.S. House of Representatives may this month take up a plan to put in place large structural reforms to the Medicare system.  This is a huge win for conservatives. Entitlement reform is the only way that the growth of government can be controlled this century.

Particularly, the House is considering a plan that controls the growth of Medicare in two key ways

Over time, wealthier seniors would pay for more of their own Medicare benefit, and taxpayers would pay for less of it.  This concept, known as "means testing," already exists in Medicare. Seniors with higher incomes already have to pay for a greater share of their Medicare Part B (physicians) and Part D (prescription medicines) subsidy benefit. 

Under the House's plan, this means testing would increase.  That is a spending cut, and a common sense one. There is no reason why a working family should have to pay taxes to support a Medicare benefit for a recipient who can afford to pay more of it himself. Warren Buffet can pay for his own Medicare quite easily, and should do so.

Reform Medigap plans. Seniors on traditional Medicare often buy a wraparound health plan known as a "Medigap" plan to cover what Medicare does not. Under the House concept, these plans would be reformed so that seniors would see more of the true cost of these Medigap policies.

Ideally, seniors would migrate over to the far more efficient Medicare Advantage market, where Medicare is delivered via a private sector insurance plan in a way familiar to anyone with a health plan at work.  Medicare Advantage plans compete with each other for seniors' business, and therefore deliver a superior health product with much greater value.  Medicare Advantage plans are also far easier starting points for even more comprehensive Medicare reforms.

Together, these Medicare structural reforms represent powerful savings to taxpayers.  But they will take some time to be realized.  Any changes to entitlements must be phased in over time so that younger seniors and workers can adjust their planning accordingly.  But we know that these structural changes will yield a very powerful check on uncontrolled Medicare spending.  For example, President Obama's own budget says that increasing means testing in Medicare results in a $16 billion annual savings in 2025 alone.  This number will get bigger and bigger as time goes on.

What is the incentive of Congressional Democrats and President Obama to agree to structural Medicare entitlement reform?  House Republicans will offer in exchange a permanent repeal of the "Sustainable Growth Rate," or SGR.  Under SGR, Medicare reimbursements to doctors is threatened to be cut by about 25% starting this year.  I've written far more about SGR here.

There's just one problem with SGR--it's a fake, phony spending cut.  Congress has delayed its implementation 17 times since 2003.  Congress will no doubt delay the SGR spending cut (via a "doc fix") another 17 times in the years to come.

Critics of this swap claim that the 17 doc fix delays were accompanied by spending cut offsets, so we should continue to use doc fix for leverage.  The first problem with that thinking is that many of the spending cuts were gimmicky.  The second problem is that large structural changes to Medicare are a FAR bigger prize.  Over time, trillions of dollars of Medicare's unfunded debt liabilities will be saved with this plan.  All we will have surrendered in return is a theoretical, never-gonna-happen spending cut of far smaller size.

Even Medicare's own actuaries--whose job it is to accurately forecast the costs of Medicare--think SGR is not going to accomplish what it sets out to do. All SGR actually does is create a gravy train for lobbyists and political fundraisers to enact the next "doc fix."  Removing it would stop Medicare from cooking the books on its true costs, and would take away a huge amount of political corruption in the health care sector.  Conservatives should hate SGR, and view its replacement with large structural Medicare reforms as a win-win of the highest order.

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