How the Trump Republican Tax Cuts Are Helping Vermont

Posted by John Kartch on Thursday, July 2nd, 2020, 12:00 PM PERMALINK Follow @JohnKartch

Vermont is benefiting greatly from the Tax Cuts and Jobs Act enacted by congressional Republicans and President Trump:

41,570 Vermont households are benefiting from the TCJA’s doubling of the child tax credit.

Every income group received a tax cut. Nationwide, a typical family of four received a $2,000 annual tax cut and a single parent with one child received a $1,300 annual tax cut.

236,900 Vermont households are benefiting from the TCJA’s doubling of the standard deduction. Thanks to the tax cuts, nine out of ten households take the standard deduction which provides tax relief and simplifies the tax filing process.

10,920 Vermont households are benefiting from the TCJA’s elimination of the Obamacare individual mandate tax. Most households hit with this tax made less than $50,000 per year.

Lower utility bills: As a direct result of the TCJA’s corporate tax rate cut, Vermont residents are saving money on utility bills. Lower electric, water, and gas bills help households and small businesses operating on tight margins. For example, Green Mountain Power and Vermont Gas Systems, Inc. both passed along tax reform savings to their customers in the form of lower rates.

Thanks to the tax cuts, Vermont businesses of all sizes are hiring, expanding, raising pay and increasing employee benefits:

Mack Molding (Arlington, Vermont) - Major facility upgrades:

Mack Molding, an injection molder and contract manufacturer based in Vermont, announced this week that it is investing $5.4 million to upgrade two existing facilities in response to “favorable tax changes” and a surging economy. - July 16, 2018 National Association of Manufacturers article excerpt

Green Mountain Power (Colchester, Vermont) – The utility will pass along tax savings to customers:

In a filing today with the Vermont Public Utility Commission, Green Mountain Power is seeking to lower bills for customers by $6 million. The benefit comes from federal tax law changes that reduce GMP's corporate tax rate from 35 percent to 21 percent. This change will be retroactive and take effect January 1, 2018 at the start of GMP’s new rate year. The reduction will be applied starting in the February bill cycle and will be returned monthly throughout 2018 as a bill credit.

"After the federal tax plan passed, GMP pledged to return 100% of the tax benefit to customers, and today's letter sets in motion our plan to reduce rates to provide those savings to our customers immediately," said President and CEO Mary Powell. “Keeping energy costs low and stable is a key focus at GMP and this decrease will help offset increased cost pressures in other areas outside of our control such as regional transmission costs.”

This rate reduction will help offset the recent rate increase that took effect in January. GMP customers will continue to see the benefits of the new, lower tax rate for as long as these rates are in effect because they will be reflected in future proposed energy rates. GMP is set to file its next rate case in April. – Jan. 23, 2018 Green Mountain Power press release

DJ's Tree Service (Colchester, Vermont) -- Used provisions in the tax cut to buy new equipment:

"One truck, a chainsaw and a few hand tools is all Jim Myers and his former business partner had when they started their tree service business.

"Our first customer said he wouldn't hire us unless we were insured. We told him 'of course, we're insured, but we need a deposit before we get started.' We took the deposit and bought insurance," said Myers smiling as he retold the story.

......

"A recently added service from the company is creating and selling mulch. When removing a client's tree, they would run into the challenge of proper disposal. So as a solution to the problem, the Myers purchased a Bandit Beast recycler. The recycler is capable of processing large unusable waste wood, to create high-quality mulch, which is then sold to residential or commercial clients. This machine can process tree/land clearing debris right down to the stump as well as processing construction debris. To assist in the operation of the recycler and sell the mulch, DJ's Tree Service hired a few new employees. The purchase of the recycler allowed the company to take advantage of the Tax Cuts and Jobs Act of 2017. Part of the act made changes to Section 179 of the IRS Code, which allows small businesses to deduct the entire price of new machinery and equipment during the year of the purchase. Prior to the Tax Cuts and Jobs Act, businesses could only deduct a portion of the price of the equipment each year." -- July 4, 2019 Vermontbiz.com

Vermont Gas Systems, Inc. (South Burlington, Vermont) – The utility will pass savings from tax reform to customers:

Vermont Gas announced today that it will reduce 2018 customer costs by $2.4 million, the full benefit of December's federal tax law changes.

Vermont Gas has filed a notice with the Vermont Public Utility Commission to give customers a monthly credit on 2018 bills, starting February 1st and continuing through October 2018. Each of Vermont Gas’ 51,000 customers will receive a credit on their heating bill, based on usage, over the next eight months. For families, this bill credit will total almost $40 over the year; businesses could see even more.

“Our commitment to our customers is to maintain affordable and competitive rates, while offering top-rate customer service. We are so pleased to return the full benefit of this new federal tax reduction to every family and business this year,” said Don Rendall, President and CEO of Vermont Gas. “Our customers will start to see a reduction in their heating bills next month and with the recent bitterly cold weather we’ve been experiencing, this money will be a welcomed relief.”

While each customer’s total savings will vary depending on their actual usage, the average residential customer’s annual bill will be almost $40 lower because of this change. Businesses could receive hundreds, or thousands of dollars credited over the course of the year, depending on usage.

“As a Vermont Gas customer at my home and for my downtown hair salon, I’m always looking for ways to save money,” said Glenn Brown, Burlington resident and owner of Chop Shop Hair Design. “I’m excited that Vermont Gas is passing along the tax credit to customers – every little bit helps this time of year.”

“We’re pleased to return this money to customers because we know how important it is for everyone to keep costs in check, especially during the winter months,” Rendall continued. “Natural gas is already the cleanest and most affordable heating choice for over 51,000 families and businesses and we know these savings will help.” – Jan. 23 2018, Vermont Gas Systems, Inc. press release excerpt

Brattleboro Development Credit Corp (Brattleboro, Vermont) -- Opportunity Zones helped encourage investment in Brattleboro:

The EDA said the grant will be going to "a designated Opportunity Zone, created by President Donald J. Trump's Tax Cuts and Jobs Act of 2017 to spur economic development by giving tax incentives to investors in economically-distressed communities nationwide."

"Congratulations to the town of Brattleboro on its recent award from the EDA to make infrastructure improvements at the Exit One Industrial Park and Delta Business Campus," Gov. Phil Scott said in a statement. "I'm pleased to see the town and the Brattleboro Development Credit Corp. working together to make economic expansion a reality in southern Vermont. These partners have set the table for economic growth by positioning prime developable land to anchor industrial sites that host more jobs in both traditional and new or expanding industries. I also want to thank our federal partners and Vermont's congressional delegation for supporting funding for the EDA. I hope this region's Opportunity Zone designation continues to drive interest in public and private investment in the coming years." -- August 12, 2019 Brattleboro Reformer

Voi Inc. (Springfield, Vermont) -- The artificial intelligence company was able to open a location because of a grant that was made possible by the TCJA Opportunity Zones:

SPRINGFIELD, Vt. — The Black River Innovation Campus (BRIC) will be getting a new manufacturing neighbor dedicated to artificial intelligence behavioral technology inside the former Park Street School.

With the help of a grant from the Center on Rural Innovation, Voi Incorporated will be located adjacent to the Black River Innovation Campus.

"According to Calvelli, the Center on Rural Innovation Fund seeks to fund economic growth in rural communities while making connections with technology based companies to provide jobs for economically depressed areas.

"The Center on Rural Innovation Fund invests in growth businesses located in qualified Opportunity Zones in the United States to enhance economic growth and job creation in small communities. The fund seeks to find attractive technology-enabled operating businesses in rural geographies, which are under-served by traditional venture capital institutions," Calvelli said. "The Center on Rural Innovation Fund identifies, funds, and supports the best tech entrepreneurs American small towns have to offer." -- February 28, 2020 Argus-Champion.

Opportunity Zone in Springfield, Vermont: Two residential properties were purchased because of tax savings through the Opportunity Zone program, bringing jobs and business to the town:

SPRINGFIELD, Vt. — The town of Springfield became a center of machine tool manufacturing in the 20th century. But as the industry began to wane, this industrial town on the Connecticut River, once an economic powerhouse, fell on hard times and has struggled to reinvent itself.

Local boosters say a new federal program that gives wealthy people incentives to invest in low-income communities could be the key to reviving Springfield's economy.

The so-called “Opportunity Zone" program has brought new investors to this storied factory town.

The tax break incentive has proved to be “an extremely attractive tool" for economic development, according to Bob Flint, the executive director of the Springfield Regional Development Corp.

“It's stimulated really interesting projects," Flint said.

Two multi-unit residential properties in Springfield have already been purchased through the Opportunity Zone program. -- September 8, 2019 Valley News Article.

Lakemont Retirement Community (Newport City, Vermont) -- A developer was able to build a new retirement community by taking advantage of the TCJA Opportunity Zone program:

NEWPORT CITY — Developer Heidi Eichenberger wants to build a $22 million housing development called Lakemont Retirement Community on Lakemont Road featuring nearly 200 apartments and a full range of services.

She hopes to tap into a newly created "opportunity zone" in Newport City that would allow people who sell property to invest and defer capital gains taxes into the future and also reduce the tax burden over time.

If all goes well with investments and permitting, construction could begin on Lakemont Retirement Community in the spring and be completed in October, said Eichenberger this week.

It's a unique development for Vermont that has support from Newport City Mayor Paul Monette, Jon Freeman, president of Northern Community Investment Corp., and others working in the accounting, construction and banking industries.

"I look at this as ideal," Monette said Thursday when some of the supporters and people working with Eichenberger on the project gathered at her office at the Hearing Center of Vermont on the Derby Road.

......

And it is the first large project to be proposed for one of Vermont's 25 "opportunity zones." There are thousands nationwide but the law that created these zones is new. There are two other zones in the Northeast Kingdom in Lyndonvile and St. Johnsbury.

Eichenberger said she initially looked at developing the project in Derby but switched to Newport City when she learned about the opportunity zone here. She created Lakemont Investment LLC to take advantage of this special zone.

The zone allows investors who sell property to invest their capital gains into the project and defer capital gains taxes for years and also see some tax breaks on the investment, according to Stephen Trenholm, certified public accountant with Gallagher, Flynn & Company. -- February 15, 2019 The Caledonian-Record article.

AT&T -- $1,000 bonuses for 73 Vermont employees. Nationwide, $1 billion increase in capital expenditures:

Today, Congress approved legislation representing the first comprehensive tax reform in a generation. The President is expected to sign the bill in the coming days.

Once tax reform is signed into law, AT&T* plans to invest an additional $1 billion in the United States in 2018 and pay a special $1,000 bonus to more than 200,000 AT&T U.S. employees — all union-represented, non-management and front-line managers. If the President signs the bill before Christmas, employees will receive the bonus over the holidays.

“Congress, working closely with the President, took a monumental step to bring taxes paid by U.S. businesses in line with the rest of the industrialized world,” said Randall Stephenson, AT&T chairman and CEO. “This tax reform will drive economic growth and create good-paying jobs. In fact, we will increase our U.S. investment and pay a special bonus to our U.S. employees.”

Since 2012, AT&T has invested more in the United States than any other public company. Every $1 billion in capital invested in the telecom industry creates about 7,000 jobs for American workers, research shows. -- Dec. 20, 2017 AT&T Inc. press release

Walmart – Vermont employees at 6 Walmart stores received tax reform bonuses, wage increases, and expanded maternity and parental leave. Walmart employees who adopt children will be given $5,000 to help cover expenses.

Home Depot -- 3 locations in Vermont; Bennington, Williston, Rutland -- Bonuses for all hourly employees, up to $1,000.

Lowe's --200+ employees at two stores in Vermont; Burlington and Essex Junction-- Employees will receive bonuses of up to $1,000 based on length of service, for 260,000 employees; expanded benefits and maternity/parental leave; $5,000 of adoption assistance.

Ryder (Two locations in Vermont; White River Junction and Williston) – Tax reform bonuses for employees.

Starbucks Coffee Company (8 locations in Vermont) - $500 stock grants for all retail employees, $2,000 stock grants for store managers, and varying plant and support center employee stock grants. Nationally, 8,000 new retail jobs; an additional wage increase this year, totaling approximately $120 million in wage increases, increased sick time benefits and parental leave.

Best Buy -- (Williston, Vermont) -- $1,000 bonuses for full-time employees; $500 bonuses for part-time employees.

Cintas (Multiple locations in Vermont) -- $1,000 bonuses for employees of at least a year, $500 for employees of less than a year.

Chipotle Mexican Grill (Burlington, Vermont) – Bonuses ranging from $250 to $1,000; increased employee benefits; $50 million investment in existing restaurants.

Comcast (Three locations in Vermont: Newport, Rutland, South Burlington) -- $1,000 bonuses; nationwide, at least $50 billion investment in infrastructure in next five years.

T.J. Maxx – (Five locations in Vermont; Barre, Burlington, Middlebury, Rutland, St Albans) – Tax reform bonuses, retirement plan contributions, parental leave, enhanced vacation benefits, and increased charitable donations:

The 2017 Tax Act benefited the Company in the fourth quarter and full year Fiscal 2018. The Company expects to continue to benefit from the 2017 Tax Act going forward, primarily due to the lower U.S. corporate income tax rate. As a result of the estimated cash benefit related to the 2017 Tax Act, the Company is taking the following actions:

Associates

A one-time, discretionary bonus to eligible, non-bonus-plan Associates, globally
An incremental contribution to the Company’s defined contribution retirement plans for eligible Associates in the U.S. and internationally
Instituting paid parental leave for eligible Associates in the U.S.
Enhancing vacation benefits for certain U.S. Associates

Communities

Made meaningful contributions to TJX’s charitable foundations around the world to further support TJX’s charitable giving – Feb. 28, 2018 The TJX Companies Inc. press release excerpt

U-Haul (Multiple locations in Vermont) – $1,200 bonuses for full-time employees, $500 for part-time employees.

Dollar Tree, Inc. (Multiple locations in Vermont) -- Increased base wages, enhanced benefits including maternity leave for qualifying employees and employee training, totaling $100 million nationwide.

FedEx (Multiple locations in Vermont) – Accelerated and increased compensation; pension plan contributions:

FedEx Corporation is announcing three major programs today following the recently enacted U.S. Tax Cuts and Jobs Act:

Over $200 million in increased compensation, about two-thirds of which will go to hourly team members by advancing 2018 annual pay increases by six months to April 1st from the normal October date. The remainder will fund increases in performance- based incentive plans for salaried personnel.
A voluntary contribution of $1.5 billion to the FedEx pension plan to ensure it remains one of the best funded retirement programs in the country.
Investing $1.5 billion to significantly expand the FedEx Express Indianapolis hub over the next seven years. The Memphis SuperHub will also be modernized and enlarged in a major program the details of which will be announced later this spring.

FedEx believes the Tax Cuts and Jobs Act will likely increase GDP and investment in the United States. -- Jan. 26 2018, FedEx press release

McDonald’s (25+ locations in Vermont) – Increased tuition investments which will provide educational program access for 400,000 U.S. employees. $2,500 per year (up from $700) for crew working 15 hours a week, $3,000 (up from $1,050) for managers, and more:

McDonald’s Corporation today announced it will allocate $150 million over five years to its global Archways to Opportunity education program. This investment will provide almost 400,000 U.S. restaurant employees with accessibility to the program as the company will also lower eligibility requirements from nine months to 90 days of employment and drop weekly shift minimums from 20 hours to 15 hours. Additionally, McDonald’s will also extend some education benefits to restaurant employees’ family members. These enhancements underscore McDonald’s and its independent franchisees’ commitment to providing jobs that fit around the lives of restaurant employees so they may pursue their education and career ambitions.

The Archways to Opportunity program provides eligible U.S. employees an opportunity to earn a high school diploma, receive upfront college tuition assistance, access free education advising services and learn English as a second language.

“Our commitment to education reinforces our ongoing support of the people who play a crucial role in our journey to build a better McDonald’s,” said Steve Easterbrook, McDonald’s President and CEO. “By offering restaurant employees more opportunities to further their education and pursue their career aspirations, we are helping them find their full potential, whether that’s at McDonald’s or elsewhere.”

Accelerated by changes in the U.S. tax law, McDonald’s increased investment in the Archways to Opportunity Program includes:

- Increased Tuition Investment:
  - Crew: Eligible crew will have access to $2,500/year, up from $700/year.
  - Managers: Eligible Managers will have access to $3,000/year, up from $1,050.
  - Participants have a choice for how they apply this funding – whether it be to a community college, four year university or trade school. There is no lifetime cap on tuition assistance – restaurant employees will be able to pursue their education and career passions at their own pace. The new tuition assistance is effective May 1, 2018 and retroactive to January 1, 2018.
- Lowered Eligibility Requirements: Increase access to the program by lowering eligibility requirements from nine months to 90 days of employment. In addition, dropping from 20 hours minimum to 15 hours minimum (roughly two full time shifts) per week to enable restaurant employees more time to focus on studies.
- Extended Services to Families: Extension of Career Online High School and College Advisory services to restaurant employees’ family members through existing educational partners Cengage and Council for Adult and Experiential Learning (CAEL).
- Additional Resources: Career exploration resources for eligible restaurant employees to be available later this year.
- Creation of an International Education Fund: Grants to provide local initiatives and incentives in global markets to further education advancement programs.

“Since its inception, Archways to Opportunity was meant to match the ambition and drive of restaurant crew with the means and network to help them find success on their own terms,” said David Fairhurst, McDonald’s Chief People Officer. “By tripling tuition assistance, adding education benefits for family members and lowering eligibility requirements to the equivalent of a summer job, we are sending a signal that if you come work at your local McDonald’s, we’ll invest in your future.”

After launching in the U.S. in 2015, Archways to Opportunity has increased access to education for over 24,000 people and awarded over $21 million in high school and college tuition assistance. Graduates have received college degrees in Business Administration, Human Resources, Communications, Accounting, Microbiology and more. – March 29, 2018 McDonald’s Corporation press release excerpt

Note: If you know of other Vermont examples, please email John Kartch at jkartch@atr.org

The running nationwide list of companies can be found at www.atr.org/list

More from Americans for Tax Reform

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How the Trump Republican Tax Cuts Are Helping North Carolina

How the Trump Republican Tax Cuts Are Helping Minnesota

Supercut: Team Biden Vows to Impose Carbon Tax

Posted by John Kartch on Tuesday, December 1st, 2020, 9:00 PM PERMALINK Follow @JohnKartch

Joe Biden and Kamala Harris have endorsed a carbon tax on the American people.

And as shown in the video below, they are surrounding themselves with others pushing a carbon tax, including climate czar John Kerry, OMB pick Neera Tanden, and Treasury Secretary Janet Yellen:

A carbon tax would impose burdens on households due to higher costs of cooling and heating, transportation, and groceries.

Even Hillary Clinton in 2016 decided to oppose a carbon tax after she learned the following from an internal Clinton report prepared by policy staff:

The Hillary memo states that a carbon tax would devastate low-income households: “As with the increase in energy costs, the increase in the cost of nonenergy goods and services would disproportionately impact low-income households.”

The Hillary memo states that a carbon tax would cause gas prices to increase 40 cents a gallon and residential electricity prices to increase 12% - 21%: “In our analysis, for example, a $42/ton GHG fee increases gasoline prices by roughly 40 cents per gallon on average between 2020 and 2030 and residential electricity prices by 2.6 cents per kWh, 12% and 21% above levels projected in the EIA’s 2014 Annual Energy Outlook respectively.

The Hillary memo states a carbon tax would cause household energy bills to go up significantly: “Average household energy costs would increase by roughly $480 per year, or 10% relative to the levels projected in EIA’s 2014 Outlook.”

The Hillary memo states that a carbon tax would increase the cost of household goods and services: “The cost of other household goods and services would increase as well as companies pass forward the higher energy costs paid to produce those goods and services on to consumers.”

(Source: MEMORANDUM FOR HILLARY RODHAM CLINTON -- Jan. 20, 2015)

Carbon taxes are highly unpopular with voters. In fact, carbon tax advocates can’t even get a carbon tax passed in a single blue state, as this timeline shows.

Carbon taxes also saddle state and local governments with huge costs. For example, a school district in Canada was forced to kick 400 kids off the school bus program in order to pay a $3.3 million carbon tax bill.

It's no wonder conservative groups wrote a letter to Congress Stating: "We oppose any carbon tax." The official Republican Party platform also rejects "any carbon tax."

Biden's carbon tax will also shatter his pledge to each and every American making less than $400,000 that he will not raise a single penny of any tax.

Posted by Alex Hendrie on Tuesday, December 1st, 2020, 2:33 PM PERMALINK

If lawmakers fail to act by the end of the year, breweries, distilleries, and wineries across America will face a tax increase.

The Craft Beverage Modernization and Tax Reform Act (CBMTRA) was first enacted through the Tax Cuts and Jobs Act of 2017. This bill provided federal excise tax relief for breweries, wineries, and distilleries, allowing these businesses to hire more employees, purchase new equipment, and expand production.

Unfortunately, this tax relief was temporary and is set to expire at the end of the year. Congress can make these tax cuts permanent by passing S. 362/H.R. 1175, legislation introduced by Reps. Ron Kind (D-Wis.) and Mike Kelly (R-Pa.) and Senators Ron Wyden (D-Ore.) and Roy Blunt (R-Mo).

This legislation is overwhelmingly bipartisan and has been co-sponsored by 350 members of the House of Representatives and 76 Senators. Congress should pass this legislation, either as a stand-alone proposal or as part of a broader legislative package.

ATR has kept a running list of dozens of distilleries, breweries, and wineries that have been able to expand production, hire new workers, and invest in the economy thanks to the CBMTRA. Making these tax cuts permanent will help businesses continue supporting the economy and workers.

Examples of businesses that have already seen benefits from the CBMTRA include:

Alexander Valley Vineyards

(Healdsburg, California) – The vineyard was able to create new jobs, buy new equipment, and remodel their tasting rooms because of the Tax Cuts and Jobs Act:

“The craft beverage bill has been an incredible boost for our industry and this extension allows us to continue investing in our wineries by buying new equipment, remodeling tasting rooms, hiring new employees and more,” said Hank Wetzel, founder and family partner of Alexander Valley Vineyards and Chairman of Wine Institute. “All of this benefits local communities in the form of jobs, tax revenue and support for the hospitality industry.” – Dec. 20, 2019, Southeast Farm Press article.

Portland Cider Company

(Clackamas, Oregon) – Because of the Tax Cuts and Jobs Act, the owner was able to create new jobs and invest in new equipment:

Jeff Parish, Co-Founder of Portland Cider Company and Committee Member of the United States Association of Cider Makers: “As a cider maker, the temporary CBMTRA allowed me to purchase new equipment, hire new staff and grow my business. If the excise tax credits go away, I have to reverse those choices. We're hopeful the permanent version of the bill passes, so we can plan with certainty for a growth-future." – Feb. 6, 2019, U.S. Senate Finance Committee press release.

Central Standard Distillery

(Milwaukee, Wisconsin) – The Tax Cuts and Jobs Act allowed the distillery to hire four new employees, invest in a new facility, and ordered a new bottling line:

"Central Standard Distillery co-owner Evan Hughes said his business was able to grow faster than it normally would because of the act. He attributes four key growth areas to the success of the act, including: Central Standard hired four new employees, bringing staff totals to 22 people. The company invested in a 15,000-square-foot facility on Clybourn Street. In addition, Central Standard ordered a new bottling line for improved efficiency and offered health care to all of its employees.

"It gave us the courage to expand our business quicker than we normally would," Hughes said. – Dec. 10, 2019, Milwaukee Business Journal.

Bar Cento

(Cleveland, Ohio) – The tax cuts allowed the bar to add new jobs and invest more in their facility:

Sam McNulty, co-founder of multiple Cleveland brewery/restaurants including Market Garden Brewery and Bar Cento, credited the tax break with helping his operations expand at an accelerated rate, "which in our case meant several million dollars of investment in our facility as well as the creation of a large number of full-time positions."

Not having certainty for the tax cut beyond next year could stymie other, more long-term investments.

"As in life, so it goes in business, where if the future is uncertain, you are more likely to be less secure and optimistic and thus more conservative and frugal," McNulty said. "There's not a bank on the planet that will finance a business that has only a one-year lease. And so a one-year extension is appreciated, but it is not enough to really fuel this growing industry and reach the full promise of the economic benefits of local craft beer." – Dec. 17, 2018, Crains Cleveland article.

Photo Credit: Darren Maloney

Posted by Katie McAuliffe on Tuesday, December 1st, 2020, 9:44 AM PERMALINK Follow @https://twitter.com/digitalliberty?lang=en

Today, Americans for Tax Reform sent a letter to Majority Leader Mitch McConnell urging him to confirm Nathan Simington as Federal Communications Commissioner before the end of this year.

The continue reading for the full letter text or click here.

December 1, 2020

The Honorable Mitch McConnell

Senate Majority Leader

S-230, The Capitol

Washington DC, 20510

Re: Support of Nomination of Nathan Simington to the Federal Communications Commission

Dear Majority Leader McConnell:

I write in support of Nathan Simington’s nomination to the Federal Communications Commission.

In the past four years, the FCC, under Chairman Ajit Pai’s leadership, has made major accomplishments in promoting resilient networks that spurred broadband deployment and investment. This foresight and swift action during the pandemic, kept Americans connected through the volatile and uncertain times faced by families as COVID-19 emerged globally.

Right now, Joe Biden is poised to inherit a Democrat-led FCC on day one. Under long-standing tradition, the current Republican FCC Chairman Ajit Pai will step down in January. Likewise, current Republican FCC Commissioner Mike O’Rielly will leave the agency when Congress adjourns in a few weeks because his term has expired. This means that the normally five-member FCC would be controlled by Democrats, 2-1, starting on January 20. That would give the agency the opportunity to jam through a partisan Biden agenda. While floor time is limited during the Senate’s lame-duck session, confirming Simington this year would ensure a 2-2 FCC that could forestall billions in economic damage.

The Commission’s role in Restoring Internet Freedom to stop so-called net neutrality prevented regulations that would have treated broadband providers like utilities under Title II of the Communications Act. This created an environment for $80 billion of dollars in investment from 2018 through 2019. It also prevented giving states and localities the ability to institute their own taxes and fees on broadband networks.

Republicans should not underestimate the harm that a Democrat-led FCC could impose on the American economy during Biden’s first 100 days.

A Biden Administration will likely lean on the FCC to help push through an agenda focused on taxpayer funded broadband, as it did during the Obama years. Many states have opposed taxpayer funded municipal broadband networks, while other states have pursued this path. The courts prevent the Obama era FCC from inserting itself into states who opposed municipal broadband networks. Meanwhile, we have watched networks consistently fail in states that chose to pursue taxpayer funded networks.

A Democrat-controlled FCC is expected to significantly increase its spending of Americans’ hard-earned dollars. They can do so immediately through the FCC’s Universal Service Fund without any input or check from the Senate simply by adding charges to American’s telephone bills. Democrats have also called for massive increases in in the FCC’s Lifeline and E-Rate programs. Internet connectivity has become even more vital as many of us continue to work, educate, visit doctors, and entertain from home. However, this does not necessarily mean increases in spending are necessary. The FCC has done much to redirect funding and audit subsidies.

5G connectivity has been a rallying cry across the isles, and while spectrum auctions are sure to continue, another democrat priority may involve rolling back FCC rules that limit how much cities can charge telecom companies for 5G cell sites. Bringing cities in line with market rates has encouraged and expedited the spread of important 5G infrastructure.

By confirming Simington now as Commissioner to the FCC, the Senate can forestall the impending economic harms and damage to deregulatory policies from the last four years. While the Senate calendar is tight, spending the necessary floor time to get Simington confirmed to the FCC is the most economically beneficial use of Congress’s time.

Americans for Tax Reform urges you to confirm Nathan Simington to the FCC before the end of this year. Simington’s confirmation now would ensure a 2-2 FCC at the outset of a Biden Presidency. The FCC could continue to pursue important initiatives on a bi-partisan basis, but it would be blocked from jamming through partisan initiatives—whether those involve profligate spending or an anti-growth agenda. Should you have any questions or comments on this matter, please reach out to me, or our Director of Federal Policy, Katie McAuliffe, kmcauliffe@atr.org.

Onward,

Grover G. Norquist

President

Americans for Tax Reform

Photo Credit: David Berkowitz

Posted by Tom Hebert on Tuesday, December 1st, 2020, 7:45 AM PERMALINK Follow @tomhebertdc

If Raphael Warnock and Jon Ossoff are elected to the Senate by winning the January 5, 2021 runoff elections, they will rubber stamp the Biden-Harris agenda of higher taxes on the American people.

Joe Biden has promised $4 trillion in new or higher taxes on the American people and has pledged to repeal the Trump- Republican Tax Cuts and Jobs Act “on day one.” This would raise taxes on middle class Americans all across the country – a family of four with the median annual income of $73,000 will see a tax hike of more than $2,058.

This means that if Warnock and Ossoff win on January 5th, their first order of business will be to raise taxes on all Georgians by repealing the Tax Cuts and Jobs Act.

Using IRS data from 2017 and 2018, ATR calculated the average decrease in tax liability for various income thresholds thanks to the Tax Cuts and Jobs Act. Families with AGI of between $50,000 and $100,000 saw a tax cut of roughly double that families with AGI of over $1 million received. The breakdown for Georgia is below:

Taxpayers with AGI of between $25,000 and $49,999 saw their average tax liability drop from $2,553.19 in 2017 to $2,312.76 in 2018, a 9.4 percent reduction in federal tax liability.
Taxpayers with AGI of between $50,000 and $74,999 saw their average tax liability drop from $5,459.71 in 2017 to $4,829.49 in 2018, a 11.5 percent reduction in federal tax liability.
Taxpayers with AGI of between $75,000 and $99,999 saw their average tax liability drop from $8,803.29 in 2017 to $7,675.99 in 2018, a 12.8 percent reduction in federal tax liability.
Taxpayers with AGI of between $100,000 and $200,000 saw their average tax liability drop from $17,824.57 in 2017 to $15,881.30 in 2018, a 10.9 percent reduction in federal tax liability.
Taxpayers with AGI of over $1 million saw their average tax liability drop from $786,363.64 in 2017 to $737,697.06 in 2018, a 6.2 percent reduction in federal tax liability.

Incumbent Republican Senators David Perdue and Kelly Loeffler have been consistent advocates of lower taxes and limited government. Sen. Perdue voted for the TCJA, which reduced taxes for Georgians across the board. While Sen. Loeffler was not in Congress at that time, she has consistently voiced support for lower taxes and has signed the Taxpayer Protection Pledge signer, a written commitment to her constituents to oppose any and all income tax increases.

The distinction is clear – Perdue and Loeffler will fight for low taxes and a strong economy while Ossoff and Warnock will vote for the Biden agenda of higher taxes on all Georgians and Americans across the country.

Photo Credit: John Ramspott

Posted by Alex Hendrie on Tuesday, December 1st, 2020, 7:30 AM PERMALINK

Neera Tanden, President-elect Joe Biden’s pick to lead the Office of Management and Budget (OMB), wants to impose a steep national soda tax.

Tanden endorsed the “Medicare for America Act,” legislation introduced by House Democrats that imposed a one cent tax per 4.2 grams of caloric sweetener in sugary drinks.

The Center for American Progress, which is currently led by Tanden, also called for a tax on sugary drinks as part of their “Medicare Extra for All” plan. This plan would impose several “public health excise taxes” including a tax of 1 cent per ounce to finance new spending on liberal priorities.

If one of these sugary drink taxes were imposed, it could result in a 55 to 67 cent tax on a 2-liter bottle of Coca-Cola. A single 2 liter bottle of Coca-Cola costs anywhere from $1.25 to $1.70, so this tax could total 50 percent of the cost of the product. With the Tanden soda tax burden, the cost of a 12-pack of soda could increase by $1.11 to $1.44.

A tax on sugary drinks would also be extremely regressive and disproportionately harm low-income Americans. In fact, according to a 2018 report from the Tax Foundation, 47 percent of the tax collections from a sugary drink excise tax would come from households with income under $50,000.

Even Bernie Sanders came out against a soda tax.

During his 2016 presidential bid Bernie Sanders slammed Hillary Clinton’s endorsement of a soda tax. Sanders said:

“The mechanism here is fairly regressive. And that is, it will be increasing taxes on low income and working people.”

Sanders went on to note that Clinton’s embrace of a soda tax violated her pledge to the American people not to support any tax increase on Americans making less than $250,000 per year.

"Frankly, I am very surprised that Secretary Clinton would support this regressive tax after pledging not to raise taxes on anyone making less than $250,000. This proposal clearly violates her pledge," Sanders said.

Needless to stay, this tax would violate Biden’s pledge to not raise a single penny of any tax on any American making less than $400,000 per year.

The OMB Director is responsible for implementing the President’s policy priorities across the executive branch. If confirmed, Tanden would play a key role in shaping and implementing policy proposals under a President Biden.

Biden has already called for $4 trillion in new or higher taxes on American families and businesses. With Tanden as OMB chief, a sugary drink tax could be next.

Photo Credit: Center for American Progress

Posted by Sheridan Nolen on Wednesday, November 25th, 2020, 4:17 PM PERMALINK Follow @snolen_ok

Ohio’s current local income tax structure allows municipalities to tax employees even if they do not physically work in the city that is taxing them.

This is a common rationale: employees can be taxed based upon where they work because they are using city resources like police, fire, and other public services while they are at work.

However, what happens when people stop actually working at that location? Ohio Governor Mike DeWine’s statewide COVID-19 Stay-at-Home order earlier this year has forced many employees to work from home. This means Ohioans are paying taxes to cities whose services they no longer use.

At the beginning of the pandemic in March, lawmakers passed HB 197 which deemed all work performed at private homes during the public health emergency to have been performed at the employees’ principal place of work for the purposes of taxation. In other words, cities were permitted to collect income tax dollars as though businesses were operating under normal circumstances.

This was originally passed under the assumption that it would be a temporary law, only to stay in place until 30 days after Gov. Mike DeWine ended his state of emergency declaration. As the pandemic has carried on far longer than initially anticipated, the temporary nature of the law has been strained.

In July, The Buckeye Institute and three of its employees filed a lawsuit against the City of Columbus and the State of Ohio. The lawsuit asserts it is unconstitutional to allow cities to tax income of workers who do not live there, and were not permitted to work there during the Stay-at-Home order.

In order to comply with Ohio’s emergency orders, which required nonessential businesses to close, The Buckeye Institute required its employees to work from home. According to The Buckeye Institute, this is unlawful taxation and “a clear violation of due process rights under the Fifth and Fourteenth Amendments to the U.S. Constitution and violates Article I, Section 1 of the Ohio Constitution.”

Robert Alt, President of The Buckeye Institute, cited the Hillenmeyer v. Cleveland Board of Review Supreme Court decision from 2015. In Hillenmeyer, the Court unanimously decided that local taxation of a non-resident's services must be based on the location of that person when the work was performed.

While the Ohio Supreme Court deliberates on the case, state legislators have said they plan to work on passing a new law before the end of the year. Two companion bills, inspired by The Buckeye Institute’s lawsuit, have been introduced in the Ohio Legislature.

Rep. Kris Jordan, R-Delaware, has sponsored HB 754 and Sen. Kristina Roegner, R-Hudson, has introduced its companion, SB 352. Both pieces of legislation would amend income tax withholding rules for work-from-home employees related to the COVID-19 pandemic. Employees in Ohio would be taxed where they live rather than where they work.

Sen. Roegner said, “I don’t believe it’s constitutional to be able to tax someone that doesn’t step foot in your city.”

However, while various lawmakers like Roegner have expressed their beliefs that the law is unfair, cities across Ohio say repealing the temporary law would hurt city budgets. Organizations, such as the Ohio Municipal League, have also come out against such legislation.

Ohio Municipal League Executive Director, Kent Scarrett, said that “any shift from how income taxes are collected with the coronavirus emergency measure needs extensive debate.” Membership to the Ohio Municipal League is given to any city or village in Ohio that pays annual dues. In other words, many people who are directly part of City Government are key members of the Ohio Municipal League.

If a new law is not passed before the end of the 133rd General Assembly, Sen. Roegner has promised to bring a new bill back to the Statehouse in January 2021.

The lawsuit and pending legislation of HB 754 and SB 352 could benefit taxpayers during the pandemic by simplifying how they pay taxes.

Photo Credit: Nicholas Eckhart

Posted by Tom Hebert on Tuesday, November 24th, 2020, 2:55 PM PERMALINK Follow @tomhebertdc

Democrats are fighting to expand several unemployment programs into 2021, including reviving the Pelosi $600-per-week increase in unemployment payments that subsidized welfare over work.

This could endanger the economic recovery, as past expansions of unemployment programs have resulted in more Americans out of work and decreased labor demand, according to a 2019 study from the New York Federal Reserve.

On the heels of the Great Recession, Congress extended unemployment benefits for 13 weeks on top of the normal 26 week duration in June 2008. After President Obama took office, Congress passed a number of additional expansions to unemployment, eventually topping out at 99 weeks of benefits.

Analysts from the New York Federal Reserve estimated that the unemployment rate would have been 2.2 percentage points lower in 2011 and 3 percentage points lower in 2010 if Obama’s benefit expansion did not exist. This means that the disincentive to work the benefit expansion created kept approximately 4 million Americans out of a job during the slowest economic recovery in modern history.

The report also found that extended durations of unemployment payments have a negative impact on labor demand, as “...firms would expect to bargain with workers entitled to high benefits at all future dates.”

Democrats are pushing to revive the CARES Act’s temporary $600-per-week federal pandemic unemployment compensation (FPUC) benefit. Before the FPUC expired in July, it created a situation in which 68 percent of Americans got paid more on unemployment than in the workplace.

The subsidy of welfare over work will have lasting impacts on the economy that will only worsen if brought back. A recent study conducted by the Heritage Foundation found that the FPUC will reduce GDP by between $955 billion and $1.49 trillion.

The economy is recovering strongly from the pandemic, and several promising COVID-19 vaccine candidates are on the horizon. Since the April pandemic-low, 12.1 million jobs have been recovered as businesses continue to reopen and Americans continue getting back to work. Since October, over half of the jobs lost to the Coronavirus pandemic have now been recovered, and unemployment has fallen from a record high 14.7 percent to 6.9 percent.

While workers who have been displaced by the pandemic through no fault of their own deserve a safety net, history tells us that extending these programs will do more harm than good. As our economy continues to rebound, lawmakers must keep these facts in mind and reject policies that would prolong high unemployment rates and discourage Americans from safely re-entering the workforce.

Photo Credit: Gage Skidmore

Posted by Matt Owens on Tuesday, November 24th, 2020, 11:38 AM PERMALINK

As in other states, tax collections in Texas have taken a hit due to Covid-19 and subsequent shutdowns. Texas lawmakers will be faced with the challenge of reprioritizing state spending when they convene their biennial session in January. To assist Lone Star State lawmakers in this effort, the Texas Public Policy Foundation (TPPF) has published a conservative budget plan that would limit spending growth to the rate of population plus inflation, setting a max threshold for appropriations in the next budget at $246.8 billion.

TPPF is also urging Texas lawmakers to provide property tax relief in the coming year, a goal the Americans for Tax Reform supports. Texas is one of nine no-income-tax states, yet high property tax burdens are a problem. 2021 is a great time for Texas legislators to fix that. TPPF economist Vance Ginn highlighted the excessive property tax burdens facing Texans in testimony presented to the Texas House Ways & Means Committee in September:

“Texas looks to have at least the 7th highest local property tax burden in the nation,” Ginn told lawmakers. “This is according to an effective property tax rate of 1.81% per WalletHub.com or the share of property taxes paid to owner-occupied housing value of 1.69% per the Tax Foundation. While some claim this high burden is because Texas does not have a personal income tax, the two sources above show other states with no income tax tend to have a more competitive property tax burden. Texas’s high burden is from excessive spending.”

Even though Texas has a relatively competitive state tax code (minus the state’s margins tax), local municipalities throughout Texas notoriously squeeze residents through high property taxes. The coming legislative session presents an opportunity for Governor Greg Abbott and Texas legislators to consider restructuring that relationship in order to ease property tax burdens.

TPPF’s Ginn proposes swapping the state’s patchwork of local property taxes for a uniform sales tax to fund schools.

“For the sales tax swap, we recommend replacing school M&O property taxes with final sales taxes by mostly broadening the sales tax base,” said Ginn. “In 2017, the last year for which data is available from the Texas Comptroller’s website, Texas provided an estimated $42 billion in exemptions, exclusions, and discounts to the final sales tax base, requiring a higher tax rate and higher burden on those taxed.”

The new year will be full of challenges for state lawmakers in Texas and elsewhere. But the new legislative session also presents many opportunities. In addition to balancing the budget without raising taxes in 2021, tax reform that reduces onerous property tax burdens should be a high priority for Texas legislators, as should phasing out the state margins tax.

Photo Credit: Michael Barera

Posted by Mike Palicz on Monday, November 23rd, 2020, 5:38 PM PERMALINK Follow @Mike_Palicz

The Wall Street Journal reported today that Joe Biden plans to nominate former Federal Reserve Chairwoman Janet Yellen to become the next Treasury Secretary.

Yellen is a founding member of the Climate Leadership Council (CLC), an “international policy institute” lobbying Congress to pass a carbon tax “starting at $40 a ton (2017$) and increasing every year at 5% above inflation.” Yellen is also the author of a recent study commissioned by CLC, Exceeding Paris, that recommends a $43/ton carbon tax.

According to an internal report conducted by Hillary Clinton’s 2016 Presidential Campaign, a near-identical model of CLC's carbon tax plan “would generate $219 billion a year, on average, between 2020 and 2030.” The same internal report also concluded a $42/ton carbon tax “increases gasoline prices by roughly 40 cents per gallon” and found “average household energy costs would increase by roughly $480 per year.”

Yellen: “Capitalism is beginning to run amok”

“There really is a new kind of recognition that you’ve got a society where capitalism is beginning to run amok and needs to be readjusted in order to make sure that what we’re doing is sustainable and the benefits of growth are widely shared in ways they haven’t been,” Yellen told Reuters in an October interview promoting CLC’s carbon tax plan.

Support for Carbon Adjustment Fee and Carbon Customs Unions

In the same Reuters report, Yellen expanded upon Biden’s support for a “carbon adjustment fee” on imports from countries that fail to cut emissions under the 2015 Paris climate agreement. “Our thinking is that countries with carbon pricing would form essentially clubs, or carbon customs unions, within which there would be frictionless trade,” Yellen said.

Further Support for Carbon Taxes

In an October 19 interview on Bloomberg television, Biden's Treasury pick Janet Yellen said:

"What I would recommend for the United States -- that hopefully we will in the years ahead, go in this direction -- is simply to put in place a carbon tax."

WATCH:

Biden's Own Support for a Carbon Tax

Biden endorsed a carbon tax during on CNN town hall on September 24, 2019:

CNN's Anderson Cooper asked Biden: "Would you support a carbon tax?"

Biden replied: "Yeah, no, I would."

Photo Credit: IMF

More from Americans for Tax Reform

Murkowski Puts Massive Carbon Tax “On The Table” During Event with Sheldon Whitehouse

Video: Biden “Likely” to Support a “Very High” Carbon Tax, According to Biden Advisor.

Podcast: TCI... It's a Tax!

Posted by John Kartch on Sunday, November 22nd, 2020, 11:31 AM PERMALINK Follow @JohnKartch

Joe Biden's Treasury Secretary pick wants to impose a carbon tax on the American people. Biden and Kamala Harris have also endorsed a carbon tax, an idea so radical that it was rejected by Hillary Clinton because it would devastate low income households.

In an October 19 interview on Bloomberg television, Biden's Treasury pick, Janet Yellen said:

"What I would recommend for the United States -- that hopefully we will in the years ahead, go in this direction -- is simply to put in place a carbon tax."

WATCH:

Biden endorsed a carbon tax during on CNN town hall on September 24, 2019:

CNN's Anderson Cooper asked Biden: "Would you support a carbon tax?"

Biden replied: "Yeah, no, I would."

Harris endorsed a carbon tax. "Under my plan there will also be a carbon fee," she said. CNN asked her, "How do you make sure that [companies] don't do what they will try to do, which is immediately pass that on to consumers?”

Harris replied: “That should never be the reason not to actually put a fee, in particular, a carbon fee."

Another key Biden adviser -- Jennifer Hillman -- said she expects Biden to impose a "very high" carbon tax. Hillman is reportedly in the mix for a job in the Biden administration.

A carbon tax would impose burdens on households due to higher costs of cooling and heating, transportation, and groceries.

Even Hillary Clinton in 2016 decided to oppose a carbon tax after she learned the following from an internal Clinton report prepared by policy staff:

(Source: MEMORANDUM FOR HILLARY RODHAM CLINTON -- Jan. 20, 2015)

Carbon taxes are highly unpopular with voters. In fact, carbon tax advocates can’t even get a carbon tax passed in a single blue state, as this timeline shows.

It's no wonder conservative groups wrote a letter to Congress Stating: "We oppose any carbon tax." The official Republican Party platform also rejects "any carbon tax."

Biden's carbon tax will also shatter his pledge to each and every American making less than $400,000 that he will not raise a single penny of any tax.