ATR Leads Coalition of 80 Groups Opposing “Most Favored Nation” Executive Order
Americans for Tax Reform today released a coalition letter signed by 80 free market, conservative, and libertarian groups and activists in opposition to President Donald Trump’s recent “Most Favored Nation” executive order.
If implemented, the order would impose an “International Pricing Index” on Medicare Part B drugs, tying American drug prices to the prices in foreign countries with government-run healthcare systems.
President Trump has repeatedly stood strong against the left’s calls for socialized medicine, even promising in the 2020 State of the Union Address that “we will never let socialism destroy American healthcare.”
Unfortunately, an MFN policy would adopt these same socialist healthcare policies and threaten American medical innovation. As the letter notes:
Adopting these price controls will slow medical innovation, threaten American jobs, and undermine criticism of single-payer systems. In addition, a United States embrace of price controls will make it immeasurably more difficult to get foreign countries to pay their own way in the development of new medicines.
An MFN policy would also threaten our COVID-19 response and exacerbate foreign freeloading off of American innovation. As the letter notes:
The U.S. is the best in the world when it comes to developing innovative, lifesaving and life preserving medicines. Because of this, the U.S. is leading the way when it comes to developing COVID-19 vaccines, with several promising candidates entering the final stages of testing and clinical trials.
In contrast, foreign countries have been free riding off this American medical innovation for decades through crushing price controls and other market-distorting government rules and regulations.
The MFN order would also harm our economy through a decrease in research and development. Medical innovation directly or indirectly supports 4 million jobs and $1.1 trillion in total economic impact, which will be threatened by importing price controls from foreign countries.
Finally, the letter urges President Trump to apply the same successful, deregulatory, market-based approach that he has championed in other policy areas to health care:
As President, you have championed vital changes in tax and regulatory policies that have allowed free market innovation to flourish. We believe a market-based approach like those that your administration has consistently supported in other policy areas will lead to economic growth and promising new treatments, but adopting price controls through the MFN plan would undermine rather than build on those successes.
Click here to read the full letter.
Photo Credit: Tom Lohdan
IWF: Anti-Independent Contractor Law Puts Santa Clauses Out of Work
The Independent Women's Forum, in their Chasing Work series, has released a Santa AB5 video telling the story of Patrick Turnbull, a retired landscape contractor from Sunland, California, who has worked independently as Santa Claus for the past 20 years. Because of Assembly Bill 5 in California, his 20-year tradition will come to an end.
According to IWF:
"The law forces employers to hire Santa Clauses as formal employees, instead of as independent contractors, leaving Santa, Mrs. Claus, and their elves without work. Since AB5 took effect on Jan. 1, 2020, holiday performers have been devastated. The effects of AB5 were worsened by the coronavirus pandemic."
IWF then goes into detail about what AB5 and AB5-style laws entail:
"More and more Americans now work as freelancers, independent contractors, and gig workers, rather than solely as employees of one company or organization. The workplace and workforce are changing rapidly, as workers demand more flexibility and freedom...
Despite the growing needs and demands for flexible work arrangements, some policy leaders want to severely restrict when people can work as independent contractors, freelancers, and gig workers.
California imposed the most significant restrictions on independent contractors, with a law known as AB5, which forced millions of workers into having to make an all-or-nothing choice about whether to be a full-time worker or not to work at all. Thousands had no choice, as many businesses couldn’t afford to offer all independent contractors formal employment opportunities, so they had to let them go.
California is not alone. Several other states are considering similar restrictions, and the U.S. House of Representatives passed legislation that would have imposed AB5-style restrictions on the entire country."
The referenced legislation is the Protecting the Right to Organize Act (PRO Act). Unfortunately Joe Biden and Kamala Harris support this legislation which threatens the livelihood of freelancers and independent contractors. The Democrat-controlled U.S. House of Representatives passed the earlier this year and it is expected Nancy Pelosi will bring the bill to the floor in the next congress.
Both Jon Ossoff and Raphael Warnock, running for the U.S. Senate in the Georgia runoffs, have come out in support of the PRO Act as well. If both candidates were to win, it is likely that this legislation could be passed and implemented. In this way, it is important to tell stories about the lives that have been devastated, just in California, by AB5.
ATR Opposes Most Favored Nation Drug Pricing Proposal
The Trump administration has released its “most favored nation” (MFN) final rule to impose price controls on Medicare Part B.
ATR President Grover Norquist released the following statement in opposition to the proposal:
“Now is the worst possible time to impose price controls on American medicines. Thanks to American medical innovation, we have developed Coronavirus vaccines at the fastest rate in history.
The proposed ‘most favored nation’ rule would impose socialist price controls on America’s healthcare system by arbitrarily tying the prices we pay to the prices in foreign countries. This would cripple American innovation and delay access to new treatments and cures at a time when we need them most.
The MFN rule would also embolden the left by moving the U.S. closer to a system of government run healthcare that is being pushed by radical far-left politicians like Nancy Pelosi, Bernie Sanders, and Alexandria Ocasio-Cortez.”
See also:
80 Groups Oppose Most Favored Nation Drug Pricing Executive Order
ATR Releases New Video Against Foreign Price Controls on Medicare
Photo Credit: Gage Skidmore
Joe Biden and Kamala Harris Will Raise Your Taxes
Joe Biden and Kamala Harris will raise your taxes. They will impose income tax hikes, small business tax hikes, capital gains tax hikes, corporate tax hikes, a carbon tax, and will even bring back the much-hated Obamacare individual mandate tax.
December 1, 2020: Supercut: Team Biden Vows to Impose Carbon Tax
November 22, 2020: Biden Treasury Prospect Wants to Impose a Carbon Tax
October 28, 2020: Biden to Impose $200 Gun Tax
October 23, 2020: Another Biden Middle Income Tax Hike: Elimination of Your Step Up in Basis
October 22, 2020: Biden's Individual Mandate Tax Shatters His $400,000 Pledge and Hits Swing State Households Hard
October 20, 2020: 50 Cent and Norquist Call Out Biden for 62% Marginal Income Tax Rate
October 12, 2020: Biden Likely to Impose a "Very High" Carbon Tax, Says Adviser
October 12, 2020: VIDEO: Biden and Harris Dodge "Pack the Court" Question 15 Times
October 9, 2020: VIDEO: 22 Times Biden-Harris Vowed to Eliminate Tax Cuts
October 7, 2020: Kamala Harris: "There's no question I'm in favor of banning fracking."
September 30, 2020: Video: Nine Times Biden Vowed to Eliminate the Trump Tax Cuts
September 29, 2020: Biden Was Against the Individual Mandate Before He Was For It
September 24, 2020: Biden Tax Hikes Will Erode American Competitiveness
September 17, 2020: Video: Biden Will Destroy Pennsylvania Energy Jobs
September 16, 2020: Video: Meet the "Harris-Biden" Administration
September 15, 2020: Biden's Corporate Tax Rate Hike Will Hurt Small and Midsize Local Businesses
September 14, 2020: Biden Vows to Raise Taxes on "Day One"
September 9, 2020: Biden's Like-Kind Exchange Tax Hike Will Harm Jobs and Growth
September 9, 2020: Biden's Plan to End Pass-Through Deduction Will Raise Taxes on Small Businesses
September 8, 2020: Biden Cannot Be Trusted on Taxes -- His $400,000 Pledge is Bogus
September 1, 2020: Biden vs. JFK on Taxes: Video Shows Democrats Have Veered Hard Left on Taxes
September 1, 2020: Yes, Biden and Harris Will Ban Fracking
August 28, 2020: Video: Biden Will Raise Your Taxes, Trump Will Cut Your Taxes
August 26, 2020: Kamala Harris Campaign Headquarters Located in Opportunity Zone Created by Trump Tax Cuts -- Which Biden and Harris Want to Repeal
August 20, 2020: Biden and Harris Threaten Millions of Uber Drivers and Riders
August 19, 2020: Video: Nine Crazy Kamala Harris Quotes in 45 Seconds
August 19, 2020: Kamala Harris on Trump Tax Cuts: "Get Rid of the Whole Thing"
August 19, 2020: Kamala Harris Admits She Will Strip Everyone's Private Health Insurance
August 14, 2020: HYPOCRITES: Biden and Harris Slam Uber and Lyft But Have Used Them Over 1,400 Times
August 13, 2020: Kamala Harris and Joe Biden Vow to Abolish Your Right to Work
August 12, 2020: Video: Kamala and Joe Vow to Raise Your Taxes
August 11, 2020: Kamala Harris: "Get rid of the filibuster to pass a Green New Deal."
August 4, 2020: Video: Biden Vows to Raise Taxes Despite Obama Warning
July 28, 2020: Biden Threatens Freelancers and Independent Contractors Nationwide
July 27, 2020: Video: Biden Vows to Sacrifice "Hundreds of Thousands" of Jobs in Order to Impose Green New Deal
July 15, 2020: Biden Will Impose Highest Capital Gains Tax Rate Since Jimmy Carter in 1977
July 13, 2020: Biden Broke His Middle Class Tax Pledge
July 9, 2020: Even in a pandemic, Biden vows to impose higher corporate tax rate than communist China
May 27, 2020: Biden Vows to Bring Back the Individual Mandate Tax, A Violation of His Middle Class Tax Pledge
May 22, 2020: Joe Biden said: "Let's repeal the Trump tax cut."
May 22, 2020: Joe Biden said he wants to raise the corporate tax rate.
May 8, 2020: Joe Biden lies about the Tax Cuts and Jobs Act
April 5, 2020: Biden Endorses Another Tax Hike on Middle Class
March 11, 2020: Video compilation: How High Will Biden Raise Your Capital Gains Taxes?
March 6, 2020: Video Compilation: Joe Biden is Not a Moderate
Feb. 24, 2020: Video Compilation: Biden Will Raise Your Taxes By Eliminating Your Tax Cut
Feb. 7, 2020: Joe Biden said: "I'm going to raise the capital gains rate so that you pay capital gains at what your tax rate is."
Jan. 22, 2020: Joe Biden lied about the Tax Cuts and Jobs Act, claims it only benefited "top 2% of nation"
Jan. 9, 2020: Joe Biden lied about the Tax Cuts and Jobs Act.
Jan. 7, 2020: Joe Biden lied about his healthcare plan, says "no middle class tax" will occur.
Jan. 7, 2020: Joe Biden said: “Get rid of the Trump tax cut. No, not joking.”
Dec. 6, 2019: Joe Biden said: "We should charge people the same tax for their capital gains as their tax rate is. And I think we should raise the tax rate back to, for example, I take it back to where it was before it was reduced. It could go higher, but at 39.5%, 40% basically if you have that as the capital gains, that raises, I brought along, I’m not going to bore you with it, but you’ve seen it, I brought along a graph is how much money each of these things raise."
Dec. 9, 2019: Joe Biden said the capital gains tax rate "could go higher" than 40%
Oct. 28, 2019: Joe Biden said Trump’s $2,000 middle class tax cut is “negligible”
October 24, 2019: Joe Biden said: "So reduce the corporate tax cut, the tax payment to 20%? It needed to be reduced, but if we raise it back up to 28%, it was 39%, we can raise hundreds of billions of dollars."
October 23, 2019: Joe Biden said: “[Corporations] don’t need their tax cut reduced to 20 percent, it should be raised back to 28 percent."
October 23, 2019: Joe Biden said: “So every single solitary person, their capital gains are going to be treated like real income and they are going to pay 40 percent on their capital gains tax."
Oct. 15, 2020: Joe Biden said: "I would raise the capital gains tax to the highest rate of 39.5 percent, I would double it."
September 27, 2019: Joe Biden said: “I’m gonna double the capital gains rate to 40 percent."
September 20, 2019: Joe Biden said: “What I’d be focusing on is eliminating the $1.9 trillion tax cut that [Trump] passed."
September 4, 2019: Joe Biden endorses a carbon tax.
August 21, 2019: Joe Biden said: “I believe we should, in fact, the capital gains tax should be at what the highest minimum tax should be, we should raise the tax back to 39.6 percent instead of 20 percent."
August 9, 2019: Joe Biden said: “By eliminating just a few of the tax cuts,” Biden said, then added, “I’m going to eliminate most all of them. No, you think I'm joking? I'm not."
July 30, 2019: VIDEO: 2020 Democrats Will Raise Your Taxes
July 16, 2019: Joe Biden said: “I would raise the corporate tax. I think we should have lowered it from 36 to 28 percent, but it got lowered to 20 percent. If we just raised it back to 28 percent, we would raise about 600 billion dollars a year. Look at all of the needs we have and the opportunities we have. Ladies and gentlemen, it begins by reversing those cuts.”
July 5, 2020, Joe Biden said: "Yes. Yes, I'd bring back the individual mandate."
July 5, 2019: Joe Biden said: "Well, three things. One, I do raise the tax rate to 39.5 percent. I do, in fact, eliminate the ability for them to write off capital gains the way they do now. I would raise the -- and raise billions of dollars -- raise the corporate tax rate from 20 percent to 28 percent.”
July 3, 2019: Joe Biden and Kamala Harris agree on one thing: Raising taxes
July 2, 2019: Joe Biden is running ads to "Repeal Trump's Tax Cuts."
June 22, 2019: Joe Biden said: "And folks, on day one, I will move to eliminate Trump's tax cuts."
June 17, 2019: Joe Biden said: “First thing I would do as president is eliminate the president’s tax cut."
June 4, 2019: Joe Biden said: “You go out and you make a capital gain you make a little bit of money on an investment you made and you're about to go and cash it in. You cash it in, you pay - now it's down to 20% is too low - but you pay you used to pay them 28%,"
June 3, 2019: Joe Biden said: “If you make a gain, you buy something, you buy stock or anything else and that increases from $1 to $2 or $1 - $2 million, and you want to cash it in, get the cash, you got to pay a capital gains tax much lower than what you’d pay in your regular taxes. It’s much too low now in my view, but that’s a different issue.”
May 28, 2019: Joe Biden said: “You buy something, you buy stock at a dollar it goes to two dollars. You buy a Million, it goes to a million five. When you cash that in to make the gain you made, you have to pay a capital gains tax, which I believe is much too low.”
May 13, 2019: Joe Biden said: “When I’m president, if God Willing I am, we’re going to reverse those Trump tax cuts.”
May 4, 2019: Joe Biden said: “First thing I’d do is repeal those Trump tax cuts."
The Courts Are Cooked - EU Targets American Companies for Budget Shortfalls through Lawsuits
The European Commission is about to propose a “revolutionary” overhaul of digital regulation. They say it is to protect competition, and the little guy, but it is actually about using fines to fill budget shortfalls.
These so-called revolutionary digital regulations will specifically target American tech companies, and we can be sure these new rules will be a pathway to target all successful American companies. Today all business is in some part digital.
The EU through its Commissioner for Competition, Margrethe Vestager, says it wants to make tech giants more responsible for the content on their platforms, and ensure that competitors have a fair chance to succeed against the big firms. This is supposedly being achieved by numerous antitrust proceedings against primarily American companies. This is in combination with an eminent December announcement of the new Digital Services Act, which is expected to overhaul the management of content on platforms like Google and Facebook.
The EU claims to have the interest of fair competition at heart. But we don’t have to look very hard to find the true motives. Money. American money.
In a deal between the European Parliament and the German Council of the EU presidency, instead of requiring EU leaders to reopen a €1.074 trillion budget agreement reached in July, they found a creative way to top-off some programs at a price tag of €15 billion rather than the roughly €110 billion that MEPs had initially demanded.
How did they get creative? Of the €15 billion, €12.5 billion will come from funding gained through competition fines imposed by the bloc on… American companies.
This means Vestager has been directed by the EU to fill a budget gap with fines and fees resulting from competition investigations. Any company targeted by an EU competition proceeding can be sure that the proceedings won’t be fair – they are already guilty – and the fines will be high.
Its no small coincidence that the same day of the agreement, Vestager announced two investigations on Amazon.
This isn’t the first time the EU looked to American companies to fund their budget shortfalls. Back in 2012 they planned to use nearly €3 billion in antitrust fines to fund part of their €11.7 billion budget shortage. Soon thereafter Microsoft lost their long-standing appeal on cases dating back to 1998 and 2008 with fines totaling out at €1.64 billion. At the time these were the largest fines the EU had ever issued, but they are on a serious upward trajectory.
In 2017 the EU began a three-year series of investigations into Google. The initial fine in 2017 of €2.4 billion is greater than what 18 other countries contributed to the EU’s budget that year. In fact, Google’s fine would contribute more to the EU’s budget than the bottom 9 contributing countries combined.
But it didn’t stop there. Google saw another record breaking fine of €4.3 billion in 2018 and another antitrust fine of €1.5 billion in 2019 for a total of €9.3 billion in fines over three years. All fines are being appealed.
The EU budget is unsurprisingly convoluted. Transfers from member states are one element of the budget. Fines, when collected, are used to offset transfers from member states. Overall, many states receive more back from Brussels than they contributed, making them net recipients.
The perverse incentive is clear, and the fairness of these proceedings is certainly in question. If these fines contribute more to the budget than most member states and fines are accounted for on the front end to fill budget gaps, no company can expect a fair hearing in the EU. They just want the money and will craft their laws however they need to fleece American companies.
It’s not new behavior either. The EU has been using its courts to fund its budget for decades. The EU levied 38 individual fines totaling €364 million on companies for breaching competition law in 2015. Uncontested fines from 2015 along with penalties collected from earlier cases that were upheld provided €1.4 billion in revenue in 2015, according to the European Commission.
With a total budget of around €165.8 billion in 2019, member states contributing meagerly, and in the wake of a global pandemic, we can be sure that rather than balance their budget or look to their own population and member states, the EU will be heaping on the competition fines for American companies.
Europe desperately crafts their laws for ill-gotten financial gains. They have been pushing a highly predatory digital tax structure that was written in such a way to only hit American companies after numerous European companies, including automotive manufacturers, pointed out that all companies are digital and that European “champions” would be swept up in the cull. This was confirmed when the OECD admitted that it would impossible to separate the digital economy from the rest of the economy for tax purposes. The digital tax structure, which in varying forms has passed in some countries but not EU wide, was revamped to specifically write out European companies.
We can be sure the “revolutionary” Digital Services Act expected in December will be just another crafty legal avenue for Europe to fill its budget holes.
It doesn’t matter how you feel about any company. What’s alarming is that Vestager has a budget gap she has been directed to fill, meaning fines and settlements with these companies is a forgone conclusion and few of the companies targeted will be European.
Photo Credit: European Parliament
More from Americans for Tax Reform
Norquist Discusses State Ballot Measures and Biden Tax Plan on Brad Polumbo's Breaking Boundaries Podcast
ATR president Grover Norquist recently joined Brad Polumbo on the Breaking Boundaries Podcast to discuss Joe Biden's tax plan and 2020 state ballot measures.
Referencing Illinois voters' rejection of a graduated income tax, Polumbo asks what exactly the argument is against a progressive income tax. Grover responds:
"People understand that if you divide the electorate into different groups like we do with the federal income tax, you can mug people one at a time. As both Clinton and Obama were elected promising, "I'm only going to mug the top one or two percent."... This is the Richard Speck theory of tax increases: if you can't take on everyone in the room at once, you take them out of the room one at a time to work them over... There was a conversation again in Illinois that said, "Yeah, they'll divide us and then over time we'll all see our taxes increase.""
Polumbo asks, "Biden has publically stated that he's only going to raise taxes on the rich. First, is that true? Second, what's your general assessment of that from a policy point of view?" Grover responded:
"Biden already lied his way into the Vice Presidency, along with Obama, promising to never tax anyone who earned less than $250,000 back in 2008. You may remember that they wanted energy taxes, that tax on Obamacare to force you to buy Obamacare and force you if you didn't—5 million Americans were hit by that tax, 75% of them earned less than $50,000 a year. That was directly aimed at punishing lower-income people. As Bloomberg says, the great thing about regressive taxation, taxing poor people, is that you can force them to do what you want them to do... One of the first things that Obama did was that he raised taxes on cigarette smokers. The average income of a cigarette smoker is $40,000 a year. So about a month into his presidency... [the pledge] was out the door... What we do know is that Biden has a history... of promising to only hit the rich, and then hitting everyone."
Deutsche Bank Analyst Calls For Tax On “Privilege” of Working From Home
Millions of Americans across the country have been forced to self-isolate and work from home for months because of the Coronavirus pandemic. With new lockdowns being floated across the country, one Deutsche Bank analyst is now proposing to tax American workers for this “privilege.”
Under the proposal, workers would be required to pay a 5 percent tax on their income for every day they work remotely. The analyst projects that this could raise $48 billion per year in the United States.
The rationale for this tax? According to the Deutsche Bank analyst, Americans working remotely are basically mooching off society:
“…a big chunk of people have disconnected themselves from the face-to-face world yet are still living a full economic life. That means remote workers are contributing less to the infrastructure of the economy whilst still receiving its benefits.”
The report argues that Americans being forced to work from home are seeing “direct financial savings on expenses such as travel, lunch, clothes, and cleaning,” so can afford paying a new tax. Other benefits of working from home cited by the report include “forgone socializing” and “greater job security.”
This report assumes that Americans working from home are living in luxury. In reality, many Americans working from home have faced significant challenges through the pandemic including a reduction in work hours, uncertainty over the future of their employment and declining mental health due to the government-mandated lockdowns. In fact, according to the CDC, 40 percent of American adults surveyed in June reported struggling with mental health or substance abuse during the pandemic.
In addition to the clear downsides of forced isolation, there are many problems with this tax. For one, it could dramatically increase complexity in the code.
The tax would put new burdens on small and large companies that would presumably have to track whether their employees worked from home on any given day. It would be difficult to track especially with workers that work part-time or half days.
The report suggests exempting self-employed and low-wage Americans, which could incentivize businesses to hire contractors or part-time workers over full-time employees.
Revenue generated from the tax is supposed to “support the mass of people who have been suddenly displaced by forces outside of their control.” While there should be a safety net for these Americans, the solution is not to tax those that still have their jobs. A work from home tax is nothing but an excuse to expand the size and scope of government.
While the work from home tax hike has so far not gained traction from the Left, it would fit neatly into the playbook of Bernie Sanders and Alexandria Ocasio-Cortez who have called for a $90 trillion Green New Deal, a $32 trillion Medicare for All, and a 70 percent income tax rate.
Joe Biden, Kamala Harris, and Democrat governors are considering new lockdowns, which would force millions of Americans back into isolation. Americans working from home have faced job insecurity, reduced hours, increased depression and anxiety, and declining mental health. A tax on the so-called “privilege” of working from home would exacerbate these negative side effects and add to this misery for millions of Americans.
Photo Credit: SalFalko
ATR Supports Sen. Loeffler's "Modernizing Americans' Health Care Plan"
Senator Kelly Loeffler (R-Ga.) has released the “Modernizing Americans’ Health Care Plan,” a framework to reduce costs and increase healthcare choice and access through free market, patient-centered policies.
Sen. Loeffler should be applauded for releasing this proposal. The Modernizing Americans’ Health Care Plan contains important proposals to expand HSAs to American families across the country, rejects efforts to impose price controls when addressing surprise medical billing, and provides reforms to lower prescription drug costs and incentivize American manufacturing.
Not only does this proposal contain a number of pro-growth, patient centered reforms, it also serves as an important contrast to the proposals put forth by the radical left to increase taxes and move the nation’s healthcare system closer toward socialism.
Highlights of the proposal include:
Expanding Health Savings Accounts (HSAs)
HSAs are currently used by 30 million American families to pay for common health care expenses, including doctor’s visits, prescription drugs, and hospital care. HSAs are also a middle-class tax cut – money contributed to any HSA is tax-deductible, money invested in an HSA can grow tax-free, and money spent on qualified health care expenses from an HSA is tax-free.
The framework expands HSAs so that Americans can pay for their healthcare tax free. This will allow millions of Americans across the country including gig-economy workers, every American that receives health care through their employer, Americans on Medicare and Medicaid, and those that receive care through the VA, Indian health plans, and Obamacare.
The proposal also allows HSAs to be used to pay for healthcare premiums and direct primary care and increases the HSA contribution limit from $3,550 to $10,800 for an individual and $7,100 to $29,500 for a family.
Addressing surprise medical billing without resorting to price controls
Sen. Loeffler’s legislation rejects efforts to address surprise medical billing without price controls. Surprise medical billing occurs when an individual receives an unexpectedly high medical bill as a result of being out of network or receiving emergency care.
While reforms to protect patients from high healthcare costs should be considered, some lawmakers, including Senate Health Committee Chairman Lamar Alexander (R-Tenn.), are pushing a surprise medical billing proposal that uses the heavy hand of government to set rates for any payments made to out-of-network providers.
This would replace private negotiations between insurers and providers with price controls, a proposal that should be anathema to conservatives as it utilizes government power to forcefully lower costs in a way that distorts economically efficient behavior and natural incentives created by the free market.
Sen. Loeffler’s proposal wisely reject these price controls. Moving forward, any attempt to address the surprise medical billing issue should be done in a way that avoids price controls.
Reducing drug costs and America’s dependency on China
The framework rejects the plan by far-left Democrats and Nancy Pelosi to enact socialized healthcare through H.R.3, legislation that would impose a 95 percent tax on hundreds of innovative medicines if manufacturers do not accept government set prices.
Instead, Sen. Loeffler’s proposal aims to address the root cause of high drug costs – the fact that foreign countries are freeloading off American innovation by artificially lowering prices. In order to solve this problem, the framework calls for the creation of a Chief Pharmaceutical and Medical Supply Chain Negotiator in the Office of the United States Trade Representative to fight against foreign price controls.
Sen. Loeffler’s framework also encourages American manufacturing of pharmaceuticals, medical devices and supplies by providing tax incentives for American businesses.
For instance, the proposal allows companies that move back to the U.S. to be eligible for fully business expensing on non-residential property. In order to prevent companies from being taxed when they choose to move back to the U.S, the proposal allows businesses to exclude from gross income any gain earned on the disposition of assets in the country the company is moving from.
These tax cuts will help level the playing field so that America can compete against the rest of the world. The U.S. currently lags foreign competitors, so these reforms are much needed. According to a study by the Manufacturing Leadership Council, the U.S. ranks 26 out of 36 when it comes to tax incentives that encourage domestic research and development.
Photo Credit: Tim Rawle
Democratic Socialists Gain Comrades in Office
This election cycle, many American voters reacted poorly to socialist groups trapsing around city streets. In a post-election caucus call, Virginia Democrat incumbent congresswoman Abigail Spanberger expressed frustration after narrowly surviving a challenging race, she declared “we do not need to use the word socialist or socialism ever again.”
It will be hard to grant her wish however, as the ranks of Democratic Socialist party-endorsed elected officials just grew again. Here are the Democrats who also were endorsed by the DSA.
2020 Winners
Alexandria Ocasio Cortez, New York, U.S. Representative District 14 (Democratic Party, Working Families Party)
Julia Salzar, New York, State Senate district 18 (Democratic Party, Working Families Party)
Rashiba Tlaib, Michigan, U.S. Representative District 13 (Democratic Party)
Jabari Brisport, New York, State Senate District 25 (Democratic Party, Working Families Party)
Marcela Mitaynes, New York, State Assembly District 51 (Democratic Party, Working Families Party)
Phara Souffrant, New York, State Assembly District 57
Zohran Mamdani, New York, State Assembly District 36
Jamaal Bowman, New York, Congressional District 16
Dean Preston, San Francisco, California, Board of Supervisors, District 5
Jovanka Beckles, Alameda County, California, Transit Board Ward 1
Konstantine Anthony, Burbank, California, City Council
Nithya Raman, Los Angeles, California, City Council District 4
Janeese Lewis George, D.C., City Council Ward 4
Jen McEwen, Minnesota, State Senate District 7
Cori Bush, Missouri, Congressional District 1
Danny Tenenbaum, Montana, State Representative District 95
Nikil Saval, Pennsylvania, State Senate District 1
Elizabeth Fiedler, Pennsylvania, State House District 184
Rick Krajewski, Pennsylvania, State House District 188
David Morales, Rhode Island, State House District 7
Greg Casar, Austin City, Texas, City Council District 4
2019 Winners
Dean Preston for San Francisco Board of Supervisors, District 5
Jackie Goldberg for Los Angeles School Board
Carlos Ramirez–Rosa for Chicago Alderman, 35th Ward
Jeanette B. Taylor for Chicago Alderman, 20th Ward
Byron Sigcho Lopez for Chicago Alderman, 25th Ward
Rossana Rodriguez-Sanchez for Chicago Alderman, 33rd Ward
Jivan Sobrinho-Wheeler for Cambridge City Council, At-Large
Kendra Brooks for Philadelphia City Council At-Large
Michael Payne for Charlottesville City Council, At-Large
Photo Credit: nrkbeta
More from Americans for Tax Reform
Taxpayer Win in Utah: Voters Chip Away at Income Tax Earmark – Amendment G
Utah voters approved Amendment G, which appeared on the general election ballot. This taxpayer win is a great first step towards ending an antiquated approach to managing the state budget.
Since Utah has had an income tax in place, 100% of income tax revenue has been earmarked for ‘education.’ This bizarre arrangement, which is almost exclusive to Utah (Alabama has a similar earmark), has resulted in Utah state government costing more than it should and would otherwise be the case.
Despite the fact that Utah has experienced significant surpluses in income tax revenue – roughly $1 billion in 2019 alone – not a single dollar could be used to cover other parts of the budget. As a result, other taxes have remained higher than “necessary” since income tax revenue could not go towards any other government programs.
This arrangement has also made it incredibly difficult to deliver pro-growth tax reform that reduces, or ideally phases out, the state income tax. “This [earmarking all income tax revenue for education] means the most powerful lobby in Utah – the teacher’s union – is an opponent of all pro-growth reductions in the state income tax burden,” explained Grover Norquist in an OpEd in UtahPolicy.com.
Amendment G, which won about 54% of the vote, starts to chip away at this earmark on income tax revenue. Thanks to Amendment G, income tax revenue can also be used to fund programs for children and the disabled. Not just education.
This reform, which will offer greater flexibility in the budgeting process, will allow hard earned taxpayer dollars to be used more efficiently and reduce the threat of future tax increases. It may even facilitate lower tax rates.
Photo Credit: Curtis Fry
ATR Releases Letter Urging Lawmakers To Extend or Make The CFC Look-Through Rule Permanent
ATR President Grover Norquist has released a letter to key lawmakers urging them to extend or make the controlled foreign corporation (CFC) look-through rule permanent under IRC section 954 (c)(6).
The CFC look-through rule helps provide cash-flow and liquidity for American businesses operating overseas by protecting payments such as dividends, interest, and royalties from taxation when they are made between two U.S. subsidiaries. Without the look-through rule, American businesses will be double taxed on income earned overseas.
The CFC look-through rule is set to expire on December 31, 2020. If lawmakers fail to extend the rule, or ideally make it permanent, American businesses will face tax increases in a time of immense economic damage caused by the COVID-19 pandemic.
Read the full letter here or below:
Dear Chairman Grassley, Chairman Neal, Ranking Member Wyden, and Ranking Member Brady:
I urge you to extend or make permanent the controlled foreign corporation (CFC) look-through rule under IRC section 954 (c)(6). If lawmakers fail to act, the CFC look-through rule will expire December 31, 2020, resulting in tax increases on American businesses.
The CFC look-through rule helps provide cash-flow and liquidity for American businesses operating overseas by protecting payments such as dividends, interest, and royalties from taxation when they are made between two U.S. subsidiaries. Without the look-through rule, American businesses will be double taxed on income earned overseas.
It is important to note that the CFC look-through rule is not a “tax loophole.” It does not give taxpayers a windfall, but instead levels the playing field. Foreign companies typically do not face additional tax when redeploying capital amongst different subsidiaries, so the CFC look-through rule ensures American businesses can compete.
In addition, the provision does not allow American businesses to completely avoid taxation on foreign income. Income attributable to the CFC look-through rule is still taxed under Global Intangible Low-Taxed Income (GILTI) rules, which provides a reduced corporate rate on foreign income.
There is bipartisan support for the CFC look-through rule. Since it was first enacted in 2006, the CFC look-through rule has been extended multiple times. President Obama’s FY 2016 budget proposal called for making this provision permanent. Congress preserved the CFC look- through rule in the Tax Cuts and Jobs Act in 2017, in recognition of the fact that U.S. tax should not be owed when an American company redeploys capital among foreign subsidiaries. More recently, the CFC look-through rule was extended in 2019 on a bipartisan basis.
The Coronavirus pandemic has resulted in significant economic damage to American businesses and workers. Moving forward, we need to preserve tax policies that help businesses maintain payroll and provide liquidity so they can continue investing and creating jobs. As such, I urge you to ensure that the CFC look-through rule is extended, and ideally made permanent, before its expiration at the end of the year.
Onward,
Grover Norquist
President, Americans for Tax Reform
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