ATR leads coalition opposing hike to Passenger Facility Charge

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Posted by Michael Palicz Brenna Reach on Thursday, May 23rd, 2019, 5:02 PM PERMALINK

Americans for Tax Reform recently released a coalition letter in opposition to an increase in the Passenger Facility Charge (PFC).

The PFC is just one of the many government-imposed costs charged to the flying public that drive up ticket prices. The PFC is collected from enplaned passengers at commercial airports controlled by local and state governments. Revenue earned through the PFC program is used to fund airport improvement projects and is currently capped at $4.50 per enplanement at a maximum of $18 per round trip.

In the letter, the signers state:

Airport executives have repeatedly advocated for nearly doubling the current cap on the PFC, raising it from $4.50 per enplanement to $8.50. This staggering hike would mean a family of four could be charged up to $136 on a roundtrip flight in PFC costs alone.

Before considering raising the PFC, it should be noted that taxes, fees, and other government charges already make up over 20% of the cost of an average domestic flight. Lawmakers should be looking to lighten, not worsen, the burden placed upon the flying public as air travel is an engine that helps spur our nation’s economy.

Lawmakers should oppose a PFC increase whether it is considered as standalone legislation or part of a larger government funding bill. A PFC increase is not needed to finance airport investment, would fall squarely on travelers, and goes against regular order.

You can read the full contents of the letter here.

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ATR Applauds Whip Scalise and Rep. McKinley for Resolution Condemning a Carbon Tax

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Posted by Michael Palicz on Wednesday, May 22nd, 2019, 5:56 PM PERMALINK

This afternoon, House Minority Whip Steve Scalise (R-LA) and Rep. David McKinley (R-WV) re-introduced their resolution condemning a carbon tax.

ATR President Grover Norquist issued the following statement in support of the Scalise McKinley resolution:

I urge a vote FOR the Scalise and McKinley resolution putting Congress on record in opposition to any carbon tax. A carbon tax will raise the cost of living for ALL Americans. It will increase the cost of heating one’s home in winter, of air-conditioning in the summer and raise the cost of filling one’s car at the gas station.  A carbon tax will price American goods out of world markets. Every left-wing group and congressman wants a carbon tax—it is a European Style Value Added Tax (VAT) on training wheels. Every friend of American workers and taxpayers will vote YES for the Scalise and McKinley anti-carbon tax resolution.

Last July, 41 conservative groups signed a coalition letter in support of the Scalise/McKinley anti-carbon tax resolution introduced last Congress.

ATR applauds Whip Scalise and Rep. McKinley for their leadership on this issue and for protecting Americans from a new energy tax.

ATR will continue to strongly oppose any form of a carbon tax.

Photo Credit: Zennie Abraham

Ohio Senate Should Clean Up Costly Policies in House Budget

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Posted by Doug Kellogg on Wednesday, May 22nd, 2019, 5:13 PM PERMALINK

The Ohio House recently passed a two-year budget (HB 166). It has rightfully earned praise for its solid income tax cut.

However, a deeper look reveals some bad policies that would make it more expensive for small business owners, visitors to the state, and people hailing a rideshare. And it also includes a measure that would punish innovation in medicine by bringing socialist price controls to the Buckeye State.

For starters, small businesses face some big changes under the House budget.  

The plan reduces the amount of income small businesses can deduct from $250,000 to $100,000. It also removes a 3 percent cap on the tax rate for income over $250,000 – meaning businesses earning more than that could face a tax rate over 4.67 percent, a significant increase. It is also retroactive, which can be very difficult for small business owners who now will face unexpected costs.

The Ohio chapter of the National Federation of Independent Businesses (NFIB) has raised concerns over the changes.

The House budget also includes a tax hike on booking travel. It imposes occupancy tax on service fees for online travel agent services.

These services, like Expedia, Travelocity, and others – make it easier for people to book hotels or other accommodations online. They attract travelers, which are a boon for restaurants, shops, and other local businesses.  

The thing is, the cost of your hotel room is already taxed. The House proposal adds taxes to service fees, driving up costs for Ohioans and out-of-state visitors when they use travel booking services.

That’s not the end of the taxes in the House plan. Ridesharing would also get more expensive.

Legislation that would require online marketplaces to collect and remit sales taxes will, perhaps unintentionally, ensnare for hire vehicles. The straightforward impact is the state sales tax will hit ridesharing.  

It’s not only bad if unintentional, but this is also a form of double taxation. Ridesharing drivers are already paying income tax on their earnings, and now will have to deal with sales tax. This burden will only make life tougher for drivers, and more expensive for Ohioans.

Another part of the budget would bring foreign price controls to Ohio by allowing countries with socialist health care systems to influence prescription drug reimbursement rates for Medicare Part B.

As Americans for Tax Reform wrote in submitted testimony:

“The Department of Health and Human Services (HHS) recently proposed the “International Pricing Index” (IPI) payment model for drugs administered under Medicare Part B. Essentially, this payment model imports foreign price controls into the United States by calculating the Part B reimbursement rate based on the prices set by 14 other countries.”

The bottom line: the progress the House is making with their income tax cut is weighed down by the harmful proposals in the very same budget.  Senate leaders can help the House’s income tax cut become even better by detaching it from tax hikes and socialist drug pricing controls.

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Buttigieg Endorses Six Tax Hikes in 10 Days

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Posted by Adam Sabes on Wednesday, May 22nd, 2019, 4:59 PM PERMALINK

In a 10-day span, “Mayor Pete” Buttigieg endorsed the imposition of six tax increases on the American people.

It all started on May 9, when he endorsed a steep new “parcel tax” on homes and businesses while kowtowing to union bosses in Los Angeles. The tax will drive up the cost of living for owners and renters alike. “This could break me,” said resident Maria Fischer.

On May 16, Buttigieg endorsed a carbon tax, which would raise the cost of everything Americans buy and do.

And then during a Fox News town hall this past Sunday, Buttigieg proposed four new tax hikes – an income tax hike, a corporate tax hike, a wealth tax, and a financial transactions tax -- and slammed the Tax Cuts and Jobs Act as an “unnecessary and unaffordable tax cut for the very wealthiest.”

Buttigieg said he would institute a “fairer, which means higher marginal income tax rate on those earning the most,” “a reasonable wealth tax,” possibly a “financial transactions tax,” as well as raising unspecified corporate tax provisions.

Buttigieg is just as radical on taxes as the rest of the Democrat 2020 presidential field, and has now earned the nickname “Tax Hike Pete.”

See Also:

“First thing I’d do is repeal those Trump tax cuts,” Joe Biden said during a campaign stop in Colombia, South Carolina on May 4.

“On day one, we gonna repeal that tax bill that benefited the top one percent and the biggest corporations in this country,” Kamala Harris said during a NAACP fundraiser in Detroit, Michigan on May 5.

“When I’m president, if God Willing I am, we’re going to reverse those Trump tax cuts,” Joe Biden said during a campaign stop in Nashua, New Hampshire on May 13.

“On day one, we gonna repeal that tax bill that benefited the top one percent and the biggest corporations in this country,” Kamala Harris said during a campaign stop in Nashua, New Hampshire on May 15.

Photo Credit: Gene Driskell/Flickr

NAM Study Shows Dem Threat to Repeal Tax Cuts Will Devastate Manufacturers

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Posted by Tom Hebert on Wednesday, May 22nd, 2019, 3:08 PM PERMALINK

Democrat 2020 frontrunner Joe Biden is calling for a repeal of the Tax Cuts and Jobs Act. A survey released by the National Association of Manufacturers (NAM) shows such a repeal would be a massive blow to manufacturing jobs, wages, and investments.

According to NAM’s Manufacturers’ Outlook Survey from Q1 of 2019, if the tax cuts were repealed:

  • 66 percent of manufacturers would have to scale back investment in the United States.
  • 62 percent of manufacturers said that they would scale back projected wage increases and bonuses.
  • 54 percent of manufacturers said they would cut back on hiring entirely

Small manufacturers have benefited greatly from the 20 percent passthrough deduction, and would be greatest hit if the tax law were repealed.

In 2018, NAM found that manufacturing confidence and job growth hit record-highs.

The survey also showed that 89.5 percent of manufacturers are optimistic about their company’s outlook. This optimism continues a record-high streak averaging 91.8 percent spanning the past 9 quarters.

NAM’s survey also forecasts that:

  • Employee wages will continue to rise 2.3 percent over the next 12 months.
  • Full time employment will increase 2.1 percent over the next 12 months, suggesting a tight labor market.
  • Capital investments will rise 2.8 percent over the next 12 months.

The NAM Shop Floor blog is an excellent resource documenting examples of how the Tax Cuts and Jobs Act has helped manufacturers of all sizes.

The effects of the tax reform bill are being felt all across the economy. In April, the economy added 263,000 jobs, and unemployment is at a 50-year low of 3.6 percent. Over the past year, the economy has added an average of 218,000 jobs per month. Families all across the country are seeing direct tax reduction — on net, households are paying an average of 24.9 percent in lower taxes according to a report released by H&R Block based on their clients’ tax returns.

Biden fashions himself a champion of manufacturing, yet remains obsessed with repealing the very tax cuts which helped revive manufacturing in the United States.


Bernie Sanders: I will raise your taxes

Biden: “First thing I’d do is repeal those Trump tax cuts.”

Joe Biden broke his middle class tax pledge

“Mayor Pete” Calls for Steep Tax Hike on Homes and Businesses

Kamala Harris Vows Repeal of Tax Cuts “on Day One”

Biden: “When I’m President, if God willing I am, we’re going to reverse those Trump tax cuts.”

Photo Credit: Adam - Flickr

PA Governor Wolf Has a New Excuse for Double Tax on Natural Gas

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Posted by Derek Peterson on Tuesday, May 21st, 2019, 5:03 PM PERMALINK

If at first you don’t succeed, try, try again.

Pennsylvania Gov. Tom Wolf has once again proposed a severance tax on natural gas drilling, this time to pay for “Restore Pennsylvania”, a $4.5 billion infrastructure plan.

The thing is, Pennsylvania already taxes natural gas extraction. The state imposes what is called in impact fee on gas installations which is already used for state expenditures. A severance tax is a double tax, and any claims that the natural gas industry is avoiding taxes is a lie.

This is not the first time he has called for such a tax. In 2014, Gov. Wolf called for a severance tax designed to help balance budgets, or pay for the growth of benefit programs when the state was in a bad place financially. He has called for severance taxes every year he has been in office, however these proposals have not been considered by the Republican-controlled Legislature.

Gov. Wolf is now using “infrastructure” as an excuse to implement this long-desired severance tax. His proposal, which should be appearing in the form of a bill soon, calls for borrowing the $4.5 billion needed for the projects immediately, and paying off the debt over a 20-year time period using revenue from the severance tax.

David Spigelmyer, president of the Marcellus Shale Coalition, said the following about Gov. Wolf’s proposal:

“Pennsylvania’s tax on natural gas – the impact fee – generates hundreds of millions of dollars annually for critical infrastructure programs across the entire Commonwealth. This existing annual tax revenue, when combined with other business taxes paid by the industry as well as lease bonuses and royalties tied to natural gas development on state land, has provided nearly $5 billion in revenue since unconventional shale gas development began.”

Pennsylvania’s existing impact fee achieves the same goal severance taxes set out to do in other states. Adding a severance tax on top of the impact fee would create a massive burden on the natural gas industry in Pennsylvania, making it a very unattractive state for future development.

Natural gas has been a boon to Pennsylvania, not just economically, but it has lowered carbon emissions. The state produces 20 percent of the natural gas in the United States, and Pennsylvania’s carbon emissions have gone down by 30 percent as natural gas use has grown in recent years.

It makes no sense to risk this progress with a double tax.

When asked if he would consider any other methods of funding for his proposal, Gov. Wolf stated he was open to other proposals, but was skeptical they would be able to raise the revenue needed for his project. “If you have another way of raising $4.5 billion, that are going to be dollars directed toward doing things that the people of Pennsylvania really need to make their lives better, I'm all ears”, he said.

Gov. Wolf’s severance tax has been defeated before, and it must be defeated again.

Photo Credit: Nicholas Tonelli

ATR Signs Coalition Letter Urging Congress to Reject the Fed’s Real-Time Payments Proposal

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Posted on Tuesday, May 21st, 2019, 1:55 PM PERMALINK

ATR recently joined a coalition letter led by the National Taxpayers Union to oppose the Federal Reserve considered proposal to operate a real-time payments system. The Fed’s system would directly compete with the private sector, putting nearly all customers at risk of delayed financial transactions by forcing financial institutions to choose between doing business with an existing private structure or waiting until their regulator builds a clearing system in the next five years.

In the past few years we have seen how technology has played an important role in facilitating faster payments between individuals compared to the long-established model of using checks to pay for goods and services. Aaron Klein from the Brookings Institution helps illustrate the delay in this outdated check cashing system:

If your payday was Friday, March 1 and you deposited your paycheck, it may not clear until sometime on Tuesday, March 5th. What do you do if the rent, childcare, and other fixed expenses are due the same day you get paid? Unless your paycheck is available the instant you deposit it (and that is not the case with direct deposit) you are stuck with a gap.

With technology advancement becoming cheaper and more widely available, customers can access the money immediately once it is received. Take Zelle for example, a person-to-person real-time payments system created by financial institutions for their customers to access funds sent to their bank accounts near-instantaneously. In other words, if David owes Ethan his portion for the lunch bill and both of them use Zelle, Ethan can pay David back immediately and those funds are available just about as fast as receiving a text message and opening it to read.

In 2014, The Clearing House Payments Company (an institution that provides much of the technological “plumbing” or “infrastructure” for conducting financial transactions) began the process of creating the real-time payments system in use today. The system would go live in November 2017, after large financial institutions put up the funding to build the system and has actively been attracting banks of all sizes to join the network. This benefits customers across multiple financial institutions who can send and receive payments to use near-instantaneously. The goal of The Clearing House and banks joining the system is to have all deposit holding banks using the service by the end of 2020, making the system “ubiquitous.”

A year after The Clearing House’s real-time payments system went live, the Federal Reserve published a request for comments to review and consider feedback of how the current privately created system is operating and if there was a need for the Federal Reserve to enter the market and create its own version. As George Selgin of the Cato Institute correctly points out, there would be several chilling effects the Federal Reserve would have in the marketplace should it move ahead with its own network:

No less importantly, unlike private sector providers the Fed does not have to convince shareholders that it can recover the costs involved in any new payments venture it undertakes. Thanks to its unique powers, the possibility that the Fed might compete head on with the private RTP network is likely to have an exceptionally chilling effect on RTP’s ability to attract new members, and to do so even despite RTPs first-mover advantage, and also despite any real efficiency advantages it might enjoy. Banks faced with substantial network-interface investment costs will hesitate to join RTP until they are certain of the Fed’s intention. Even if the Fed does not ultimately enter the market, this hesitation will itself be costly, because it will delay the achievement of a ubiquitous system. The likelihood that the Fed will take several years to establish its own RTGS system will compound this delay. The case of rival private-sector entrants differs, both because such entrants are only likely to contemplate entering the market if their stakeholders believe them to be capable of operating more efficiently than established rivals, or of offering services that are clearly superior to theirs, and because they must in fact offer superior or less expensive services to gain market share.

For these reasons, Americans for Tax Reform opposes any entrance of the Federal Reserve into the real-time payments market and is proud to join the coalition of organizations who share this view.

Click here to view National Taxpayer Union’s coalition letter.

Photo Credit: Sébastien Bertrand

Trump Reaches Deal with Mexico & Canada to End Tariffs

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Posted by Tom Hebert on Tuesday, May 21st, 2019, 1:38 PM PERMALINK

President Trump recently announced a deal with Mexico and Canada to remove steel and aluminum tariffs on imports and remove retaliatory tariffs imposed on American businesses. This is a big win for American workers and paves the way for swift ratification of the president’s United States-Mexico-Canada Agreement (USMCA).

Ending the 25 percent tariff on steel and the 10 percent tariff on aluminum from Mexico and Canada will have broad, positive effects. On net, the tariffs impacted over $400 billion of traded goods on an annual basis. According to a report released by the American Action Forum, steel tariffs increased imported steel costs by $5.8 billion, and aluminum tariffs increased imported aluminum costs by $1.7 billion.

Retaliatory action by Mexico has adversely impacted the cost of American exports by $3.7 billion. Furthermore, Canadian retaliatory action has adversely impacted the cost of American exports by $16.6 billion. 

Trump has been steadfast in his desire to renegotiate trade deals for the benefit of American workers and businesses and the end of these tariffs should pave the way for approval of the USMCA. 

The USMCA updates NAFTA to include new automotive rules, new protections for intellectual property rights, and modernizing agricultural trade to benefit American farmers.

A recent report shows that the USCMA would raise U.S. real GDP by $68.2 billion and create approximately 176,000 American jobs. 

The USMCA would increase U.S exports to Canada by $19.1 billion, and increase U.S. exports to Mexico by $14.2 billion. Under the new agreement, U.S. imports from Canada are projected to increase by $19.1 billion, and U.S. imports from Mexico are projected to increase by $12.4 billion. The report estimates that the USMCA would have a positive impact on all U.S. industry sectors, with the manufacturing and services sectors experiencing the most gains. 

The trade deal would also be a boon for the automotive industry. The Office of the United States Trade Representative estimates that USCMA ratification would add $34 billionin new automotive manufacturing investment, $23 billion in new annual purchases of U.S. automotive parts, and 76,000 jobs in the next five years. 

If implemented, the USMCA would contribute to already robust economic growth. 

In April, the economy added 263,000 jobs, and unemployment is at a 50-year low of 3.6 percent. Over the past year, the economy has added an average of 218,000 jobs per month, and unemployment for key demographics are at all-time lows. Families all across the country are seeing direct tax reduction — on net, households are paying an average of 24.9 percent in lower taxes according to a report released by H&R Block based on their clients’ tax returns. 

Trump’s removal of tariffs on Mexico and Canada is a huge win for American workers. Now, it is time for Congressional Democrats to work with Republicans in a bipartisan fashion to ratify USCMA.

Photo Credit: Gage Skidmore

Bernie Sanders: I will raise your taxes

Posted by Adam Sabes on Tuesday, May 21st, 2019, 11:39 AM PERMALINK

2020 Democratic presidential hopeful Bernie Sanders has repeated multiple times that he will impose a tax increase if elected.

“You’re going to pay more in taxes,” Sanders said during a Fox News town hall in Bethlehem, Pennsylvania on April 15 . At the same town hall he said, “Are people going to pay more in taxes? Yes.”

[Click here for video]

“And yes, we have to raise individual tax substantially higher than they are today,” Sanders said during an interview with Jake Tapper on July 5, 2015. 

On a separate CNN townhall hosted by Chris Cuomo in Des Moines, Iowa on Jan. 25, 2016, Sanders promised that “yes, we will raise taxes, yes we will.”

See also:

Biden: “First thing I’d do is repeal those Trump tax cuts.”

Joe Biden broke his middle class tax pledge

“Mayor Pete” Calls for Steep Tax Hike on Homes and Businesses

Kamala Harris Vows Repeal of Tax Cuts “on Day One”

Biden: “When I’m President, if God willing I am, we’re going to reverse those Trump tax cuts.”


NJ Gov. Murphy Wants $447 Million Tax Hike

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Posted by Derek Peterson on Tuesday, May 21st, 2019, 10:46 AM PERMALINK

Taxes. Whatever the question, Governor Phil Murphy’s answer is taxes.

New Jersey’s second-year governor is back with his second budget proposal and it’s all about the benjamins, AGAIN.

Murphy has proposed a radical budget to fund the state through the 2020 fiscal year that will hurt the hardworking men and women of the state with a whopping $447 million in tax hikes. New Jersey lawmakers are currently negotiating a budget to fund the state beginning on July 1.

Gov. Murphy presented a budget of $38.6 billion, a 3 percent increase in spending from the previous year. This disparity would allegedly be funded through the “Millionaire’s Tax”. This tax would hike New Jersey’s top marginal income tax rate to 10.75 percent, up from 8.97 percent for income over $1 million. This tax would cost taxpayers an estimated $447 million.

Remember, just last year Murphy pushed through a $1 billion-plus tax hike. Which included taxes on businesses, ride-sharing, rental homes, and “high-earners”, which sounds like the same thing he wants to do this year. If you want new ideas, you’ve come to the wrong place. That, despite the fact current policies are ruining New Jersey.

The Garden State has been seeing residents fleeing in record numbers, in part due to the radical tax structure in the state. People “vote with their feet”, and 2018 saw New Jersey become the No. 1 state to move away from in 2018.   

While calling for large tax increases, the budget also aimed to remove $33 million from the New Jersey Fireman’s Association fund. This fund provides financial assistance to firefighters, including volunteers, to fund burial services, retirement homes, and in-home medical care. The proposal called for moving the $33 million from the firefighter fund to the state’s general fund as revenue. It was only amid public backlash that Gov. Murphy announced he would not carry out the transfer of money from the fund.

In an attempt to tax away your Second Amendment rights, Gov. Murphy has also proposed aggressive fee hikes on firearms. Under current New Jersey law, a firearm permit is $2, a firearm identification card is $2, and a permit to carry a gun is $20. Under Gov. Murphy’s budget proposal, a firearm permit would cost $50, a firearm identification would cost $100, and a permit to carry would cost $400.

You can take action to stop these unconstitutional fees on firearms by signing our petition.

Lastly, Gov. Murphy’s budget calls for “increasing fees on opioid drug distributors and manufacturers to help support our fight against the opioid epidemic”. Make no mistake about it; this is a tax increase that will lead to higher healthcare costs for patients, pharmacies, caregivers, and businesses. This increased fee does not take in account those with a legitimate need for opioids. Opioids allow patients dealing with cancer, chronic pain to live pain-free lives. Imposing punitive fees will not deter the demand of opioids. These fees don’t address the over-prescription of opioids and the lack of education that contribute to the epidemic.

Murphy’s Law states: “Whatever can go wrong, will go wrong”, and the New Jersey FY2020 budget proposal is further proof of that.

Photo Credit: Edwin J. Torres/ NJ's Governor Office