Tom Hebert

Trump Admin Expands Patient Freedoms With New Portability Rules

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Posted by Tom Hebert on Tuesday, March 17th, 2020, 12:07 PM PERMALINK

The Trump Administration recently issued two new healthcare rules that will allow patients to have complete access and control over their medical data. These rules will give patients portability over their data across medical providers while ensuring that this sensitive patient data is protected.

Under the current system, patients lack the ability to easily control their own health records and securely share them with doctors and hospitals. Since 2009, taxpayers have spent over $36 billion on electronic health records (EHRs), but the problem still hasn’t resolved itself. Compatibility across systems is shoddy, patients still have issues accessing their records, and buggy EHR software is ripe for fraud and abuse.

President Trump has consistently focused on improving and modernizing the healthcare system to the benefit of American patients. To that end, the Center for Medicare and Medicaid Services (CMS) launched the “MyHealthEd” initiative in 2018 to give patients better access and portability of their healthcare data.  

This initiative led to new healthcare rules from two federal agencies: CMS and the Office of the National Coordinator for Health Information Technology (ONC). Both rules streamline pathways for patients to access their health data via secure mobile applications. The rules allow patients to build a cumulative healthcare record that they access wherever they go. This will empower patients to more easily and securely access and release their data to providers of their choice. In turn, this increased flexibility and modernization will improve care coordination and lead to more efficient treatment. 

While any proposal to improve transparency should be welcomed, it is important that proposals protect consumer data and privacy, gives consumers information they can readily use, and do not result in unintended consequences that increase prices or make the healthcare system more complex. Policies that expand the size and scope of government should be rejected in favor of proposals that increase choice and access. 

These new portability rules build on the Trump Administration’s record of reforming healthcare so that patients have more options. 

  • Last year the administration finalized a rule allowing employers to offer health reimbursement arrangements (HRAs) to their employees to purchase insurance as an alternative to employer provided care. Rather than offering a health plan, an HRA allows an employer to offer employees funds to purchase care they wish. HRA funds are tax free to both the employer and employee and roll over year to year. 
     
  • Trump also expanded access to short-term, limited duration health insurance plans, allowing families and individuals to purchase these health plans for 12 months with a total of 36 months of renewability. These plans are exempt from Obamacare’s costly mandates and regulations, meaning more Americans will have access to affordable and flexible healthcare. As a result, these plans are expected to be 50 to 80 percent cheaper and will offer millions of Americans flexible care after several years of increasing premiums and narrowing choices in the Obamacare marketplace.
     
  • The Administration has also proposed allowing small businesses to band together and form association health plans (AHP). Like short-term plans, AHPs are exempt from many Obamacare regulations and give workers and employers increased flexibility to offer care. Democrats are currently holding this rule up in court, and the government is waiting for a ruling on its appeal. 
     

Going forward, the Trump Administration should continue working with the private sector to lower costs, increase efficiency, and open up the healthcare system for patients.

Photo Credit: Gage Skidmore


Trump Economy Adds 273K Jobs In February

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Posted by Tom Hebert on Friday, March 6th, 2020, 11:15 AM PERMALINK

President Donald Trump’s economy added 273,000 jobs in February, smashing industry expectations amid the looming threat of the coronavirus. 

January and December jobs numbers were also revised upwards by 85,000, making the total job gains from this report alone roughly 350,000. This jobs report proves that the fundamentals of the economy are strong notwithstanding the coronavirus outbreak, and that the tax and deregulatory policies of the Trump administration have worked.

Wage growth for American workers has been at or above 3 percent for the past 19 months, according to the Bureau of Labor Statistics report. This 19-month streak is the only time average hourly wages have grown at 3 percent in the past decade. The report noted “notable job gains” in healthcare and social assistance, food services, construction, professional and technical services. Workers are also experiencing higher wage growth than managers.

In 35 of the past 39 months since Trump was elected, businesses have added more than 100,000 jobs a month. Blue collar workers are thriving in the Trump economy –– businesses have created more than 500,000 manufacturing jobs and over 825,000 construction jobs since the 2016 election.

The unemployment rate dipped back down to 3.5 percent, matching its lowest level in 50 years. The labor force participation rate remained a robust 63.4 percent in February, matching the highest level in 7 years. 

February’s impressive job growth outpaced expectations by Dow Jones economists, who predicted that the economy would add 175,000 jobs last month.

The unemployment rate for women fell to 3.4 percent in February, its lowest in 66 years. In the Trump economy, unemployment for African-Americans, Asians, Hispanics, and other key demographics remain at or near record lows.

The main takeaway from this jobs report is clear — Trump’s economic agenda is working for American workers and the Republican Tax Cuts and Jobs Act is continuing to grow the economy two years later. While many are predicting that the coronavirus epidemic will harm growth, the fundamentals of the economy remain strong due to Trump’s pro-growth economic agenda.

Photo Credit: Gage Skidmore


ATR Supports the “Education Freedom Scholarships and Opportunity Act”

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Posted by Tom Hebert on Tuesday, February 18th, 2020, 2:45 PM PERMALINK

Senator Ted Cruz (R-Texas) has introduced the “Education Freedom Scholarships and Opportunity Act, “ legislation that would help equip American workers and families with the skills they need to thrive in a 21st century economy. 

Americans for Tax Reform urges all members of Congress to support this legislation. 

President Donald Trump has made expanding access to education a priority of his administration. The Cruz bill builds on this success by providing a federal tax credit to individuals that donate to nonprofit scholarship funds, which will generate new education opportunities for students of all ages and backgrounds. These new opportunities would allow men and women to seek the technical training and apprenticeships necessary to thrive in the skilled labor force.

Similar legislation has been introduced in the House by Rep. Bradley Byrne (R-Ala.), which allows for $5 billion a year in tax credits as opposed to the $10 billion provided for in the Cruz version. The Cruz legislation is cosponsored by Sens. Tim Scott (R-S.C.), Lamar Alexander (R-Tenn.), Joni Ernst (R-Iowa), Pat Toomey (R-Penn.), Tom Cotton (R-Ark.), James Lankford (R-Okla.), Todd Young (R-Ind.), Bill Cassidy (R-La.), Jim Inhofe (R-Okla.), John Boozman (R-Ark.), Marsha Blackburn (R-Tenn.), Richard Burr (R-N.C.), Ben Sasse (R-Neb.), and Rick Scott (R-Fla.). 

18 states have already implemented similar tax credit programs to expand vocational opportunities for their residents. Cruz has worked with President Trump, Vice President Mike Pence, and Secretary of Education Betsy DeVos on how to best implement a federal version of this initiative. 

Key provisions of the Cruz bill include: 

  • States have the flexibility to create the programs that best work for them. States decide eligibility criteria for students, what constitutes education expenses, and more. 
  • Encourages workplace training education. In addition to the new federal tax credit, the Cruz bill will encourage scholarships for career and technical education, apprenticeships, certifications, and other forms of workforce training.
  • Prohibits federal control of education, and makes state participation optional. This bill completely closes the door on more federal control over state and local education priorities. 
  • Helps the most vulnerable students. The tax credit will give students in need vital scholarships and important opportunities to prepare them for gainful employment in the future. 
     

The “Education Freedom Scholarships and Opportunity Act” builds on the Trump administration’s success in expanding education opportunities for all Americans. If implemented, this bill would equip students of all backgrounds with the tools they need to succeed in a 21st century economy. 

ATR supports this legislation and urges its swift passage. 

Photo Credit: US Department of Education


Dems Want To Reimpose Obamacare Individual Mandate Tax On Millions

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Posted by Alex Hendrie, Tom Hebert on Tuesday, February 18th, 2020, 12:30 PM PERMALINK

The Democrat effort to repeal the Trump tax cuts would re-impose the Obamacare individual mandate tax penalty on millions of households, hitting thousands of families in every state and Congressional district.

Americans for Tax Reform has broken down the most recent IRS data on the individual mandate tax penalty by Congressional district, which you can view here.

The individual mandate was one of the most regressive taxes in the code before it was repealed in 2017 by the Republican passed Tax Cuts and Jobs Act. Every single Democrat in the House and Senate voted against the repeal of the Obamacare individual mandate tax. 

Prior to repeal, the mandate forced households to purchase government approved health insurance or pay a $695 tax for an individual and $2,085 for a family.

Reinstatement of this tax will hit low and middle-income families hard.

In 2017, the tax hit 4,654,990 households according to IRS data. Nationwide, roughly 74 percent of those paying the mandate had annual income of less than $50,000 and roughly 32 percent had annual income of less than $25,000. 

Key swing states that President Trump won in 2016 would be hard-hit if the Democrats reimposed the individual mandate tax penalty. 

In Pennsylvania, the tax hit 153,140 households. 

  • 56,490 of those households, or 37 percent, had annual income of less than $25,000. 
  • 121,100 of those households, or 79 percent, had annual income of less than $50,000.


In Wisconsin, the tax hit 80,240 households. 

  • 24,550 of those households, or 31 percent, had annual income of less than $25,000. 
  • 62,440 of those households, or 78 percent, had annual income of less than $50,000. 


In Michigan, the tax hit 132,750 households. 

  • 50,920 of those households, or 38 percent, had annual income of less than $25,000. 
  • 106,910 of those households, or 81 percent, had annual income of less than $50,000. 
     

Here is the breakdown from some notable House members: 

In Ways and Means Ranking Member Rep. Kevin Brady's district (R-Texas), 13,880 households paid the Obamacare individual mandate tax penalty in 2017.

  • 3,270 of those households, or 24 percent, had annual income of less than $25,000.
  • 8,900 of those households, or 64 percent, had annual income of less than $50,000. 
     

In Ways and Means Chairman Rep. Richard Neal’s district (D-Mass.), 10,140 households paid the Obamacare individual mandate tax penalty in 2017.

  • 3,390 of those households, or 33 percent, had annual income of less than $25,000.
  • 8,060 of those households, or 79 percent, had annual income of less than $50,000. 
     

In House Speaker Rep. Nancy Pelosi’s district (D-Calif.), 9,700 households paid the Obamacare individual mandate tax penalty in 2017.

  • 2,280 of those households, or 24 percent, had annual income of less than $25,000.
  • 6,050 of those households, or 62 percent, had annual income of less than $50,000. 
     

In House Minority Leader Kevin McCarthy’s district (R-Calif.), 8,000 households paid the Obamacare individual mandate tax penalty in 2017.

  • 2,530 of those households, or 32 percent, had annual income of less than $25,000.
  • 5,870 of those households, or 73 percent, had annual income of less than $25,000. 
     

[View ATR's breakdown of the most recent IRS individual mandate tax penalty data by Congressional district

Photo Credit: Nancy Pelosi - Flickr


Rep. Harris Leads Letter Against Price Controls

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Posted by Alex Hendrie, Tom Hebert on Tuesday, February 18th, 2020, 10:15 AM PERMALINK

Congressman Andy Harris (R-Md.) recently led a letter opposed to price controls as a solution to surprise medical billing.

The letter was signed by 38 other members including House Freedom Caucus Chairman Andy Biggs (R-Ariz.), House Judiciary Committee Ranking Member Jim Jordan (R-Ohio), Republican Study Committee Chairman Mike Johnson (R-La.), and House Oversight Committee Ranking Member Mark Meadows (R-N.C.).

Rep. Harris and all signers should be commended for standing against price controls.

ATR has long opposed policies that directly or indirectly impose price controls on the US healthcare system. Price controls are bad policy because they utilize government power to forcefully lower costs in a way that distorts the economically efficient behavior and natural incentives created by the free market.

In the context of surprise billing, some lawmakers have proposed using rate-setting for any payments made to out-of-network providers. Under this system, the government would set a benchmark rate to resolve out-of-network payment disputes between insurers and providers. Benchmark rate-setting would replace private negotiations between insurers and providers with government-set prices, a blatant price control on the healthcare system. 

The signers explained the numerous problems with using rate-setting to address surprise billing, noting: 

“...we oppose price controls as a solution to the issue as a solution to the issue of surprise medical billing. By design, placing such price controls on purely private transactions, would reduce access to care, increase the power of the federal government, and result in negative unintended consequences.” 

Signers also acknowledged that while Congress should act on surprise billing, any legislation that includes price controls would be a nonstarter. As the letter states: 

“Congress should act on surprise medical billing, but it should avoid top-down price controls that would simply be trading one problem for another.” 

Conservative lawmakers have consistently expressed significant opposition to price fixing mechanisms within healthcare. For instance, 192 Republicans opposed H.R. 3, legislation that would impose price controls on pharmaceutical innovation under threat of a 95 percent excise tax.

Lawmakers need to take a serious, deliberative approach in addressing surprise billing instead of rushing to pass a flawed proposal that imposes price controls on our healthcare system. 

Thankfully, conservative lawmakers are standing firm in advocating against surprise billing proposals that rely on distortionary price fixing mechanisms. 

Photo Credit: Gage Skidmore


RSC GEAR Report Gives 100+ Powerful Solutions For Smaller Government

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Posted by Tom Hebert on Friday, February 14th, 2020, 11:00 AM PERMALINK

The Republican Study Committee’s (RSC) Government, Efficiency, Accountability, and Reform (GEAR) Task Force recently released a report highlighting more than one hundred commonsense solutions to move the federal government in a smaller, smarter direction. 

RSC Chairman Rep. Mike Johnson (R-La.) and GEAR Task Force Chairman Rep. Greg Gianforte (R-Mont.) should be commended for their efforts in creating this extensive plan of action. 

The report identifies three central problems that plague federal bureaucracy, the first being power. Runaway federal bureaucrats have seized power from Congress, and that has opened the floodgates for abuse of power in agencies like the IRS.

The GEAR report calls for a restoration of the proper balance of power between Congress and the Executive Branch. Notably, the report recommends (among many proposals): 

  • Enacting the REINS Act, which would require Congress to pass a joint resolution for any major rule within 70 days of promulgation before the rule takes effect. This legislation would fundamentally change the rule-making process and save taxpayers money by expanding Congressional oversight on major rules. 
     
  • Expanding use of the Congressional Review Act (CRA), which allows Congress to roll back recently promulgated regulations under an expedited parliamentary process. Expanding CRA use will allow Congress to use its rightful constitutional power to prevent the implementation of harmful, costly regulations. 
     
  • Codifying that CRAs apply to “regulatory dark matter,” which would encompass so-called “guidance documents” that function as de-facto regulations. The RSC plan gives Congress an expedited avenue to strike down initiatives that do not follow the CRA process.
     
  • Enact the Article I Restoration Act, which would require federal regulations to expire every three years if not specifically authorized. 
     

Of course, restoring the proper balance of power is only the first step in constraining runaway bureaucrats. Step two is reforming government practices with a special focus on eliminating waste. The report has many suggestions large and small for eliminating waste, including: 

  • Improving metrics for regulatory decision-making. In the private sector, managers do not make strategic decisions without evidence. The RSC plan would hold bureaucracy to the same standard and encourage Congress to modernize the government’s collection of metrics to ensure policymakers are informed by the best data available. 
     
  • Utilize excess federal office space. As of 2016, federal agencies own 3,120 vacant buildings and 7,859 underutilized buildings. The GEAR Task Force recommends that agencies sell unused buildings and lease office space (when appropriate) to like-minded organizations instead of letting the buildings waste taxpayer dollars for absolutely no reason. Citizens Against Government Waste projects that these reforms would save taxpayers $15 billion over the next five years. 
     
  • Stop paying dead people. In 2016, the Social Security Administration (SSA) paid out $37.7 million in benefits to 746 dead veterans. In 2015, the SSA Inspector General identified 6.5 million individuals listed as being 112 years of age or older without any recorded death information. Embarrassingly enough, the SSA has failed to curb these improper payments to deceased individuals. GEAR Task Force Chairman Rep. Greg Gianforte (Mont. – At Large) has introduced legislation that would provide a framework for SSA to partner with state and local agencies to collect and disseminate death data. 

 

Finally, the GEAR Task Force recommends that the federal government realign its personnel policies with those of the private sector. Namely, the report proposes: 

  • Modernizing the hiring process so that hiring managers can efficiently and effectively recruit highly qualified candidates to fill jobs. On average, it takes federal agencies three times longer than the private sector to hire employees. The RSC plan recommends that Congress focus on two goals in streamlining the hiring process –– empowering hiring managers to recruit outside of OPM recommendations, and automating human resource functions to more efficiently utilize taxpayer funds. 
     
  • Enact the MERIT Act so that managers can more easily remove toxic federal employees. Currently, it takes over 300 days to remove a bad employee due to the myriad red tape associated with the process. The MERIT Act offers a framework to realign firing procedures on the federal level with the efficient practices of the private sector. Additionally, the MERIT Act also limits retirement compensation and allows managers to recoup bonuses from employees who were later found to commit workplace violations. 
     
  • Provide mandatory removal of federal employees who commit crimes. In 2016, the VA demoted (but kept on staff) an individual who was convicted of assisting an armed robbery. This plan would fully empower agencies to terminate serious criminals. 
     
  • Ban taxpayer-funded union work. Under current law, federal employees are paid for engaging in union activity while on the job. The RSC plan would eliminate this and make it a fireable offense. 
     
  • Enact merit-based pay in federal agencies, which would allow managers to reward employees based on performance. Under current law, there is barely a merit-based component to the existing compensation system, and federal workers are paid based on seniority and demonstrating an “acceptable level of competence.” The RSC plan recommends moving towards a merit-based pay system that rewards exception and highly-skilled employees with appropriate compensation. 
     

The RSC GEAR Task Force report on commonsense government reform is a powerful plan of action for when Republicans take back the House majority in November. The plan is chock-full of reforms that will rein in runaway bureaucracy and leave the American people with a smaller, better, more efficient government. 

 

Photo Credit: Joe deSousa


Trump Economy Adds 225K Jobs In January

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Posted by Tom Hebert on Friday, February 7th, 2020, 11:00 AM PERMALINK

President Donald Trump’s economy added 225,000 jobs in January, smashing industry expectations and defying Democrats who said that tax cuts and deregulation were no longer spurring economic growth.

Wage growth for American workers has been at or above 3 percent for the past 18 months, according to the Bureau of Labor Statistics (BLS) report. BLS also highlighted “notable job gains” in industries like construction, transportation, and warehousing. Prior to this streak, wages had not reached 3 percent growth during the previous 10 years. Workers are also experiencing higher wage growth than managers.

In 35 of the past 38 months since Trump was elected, businesses have added more than 100,000 jobs a month. 

The unemployment rate ticked up slightly to 3.6 percent as Americans flooded the job market last month. The labor force participation rate increased to 63.4 percent, the highest level in seven years. 

January’s job growth wildly outpaced expectations by economists surveyed by Dow Jones, who predicted that January would only see 158,000 jobs added. Jobs numbers for November and December were also revised upwards. 

The main takeaway from this jobs report is clear — Trump’s economic agenda is working for American workers. The Republican Tax Cuts and Jobs Act is continuing to grow the economy over two years after Trump signed it into law. 

Businesses have responded to the tax cuts by giving employees higher wages and creating new employee benefit programs, while utility companies are passing tax savings onto consumers in the form of lower rates.

Families are also seeing direct tax reduction – a family of four with annual income of $73,000 (median family income) will see a tax cut of more than $2,058, a 58 percent reduction in federal taxes. 

The establishment press attributed this impressive job growth to the weather. This is nonsense. President Trump’s economic agenda delivered yet another month of strong jobs growth for workers all across the country.

Photo Credit: Gage Skidmore


Joe Biden's Top Ten Tax Hikes

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Posted by Tom Hebert on Friday, January 31st, 2020, 1:00 PM PERMALINK

Biden has proposed raising taxes on American businesses, workers, and families. Biden’s plan would also claw back all the progress President Trump and Congressional Republicans have made in reforming the tax code for the benefit of all Americans. 

In compiling this list, ATR used Biden’s estimate for revenue raised for each new provision. All told, Biden says his tax hikes would raise $3.42 trillion over the next decade. 

A recent study from the left-wing Tax Policy Center estimates that the Biden tax plan would raise taxes on Americans by $4 trillion over the next decade. 

The Penn Wharton Business Model projects that Biden’s tax hikes would raise between $2.3 trillion (including macroeconomic effects) and $2.6 trillion (excluding macroeconomic effects), $1 trillion less Biden’s estimate.

Either way, none of these estimates would come close to raising the $4.8 trillion Biden needs to enact his wishlist of liberal policies. 

Joe Biden fashions himself a moderate Democrat, but his tax plan is firmly in line with the radical left. Here are Biden’s tax increases.

1.   Tax capital gains as ordinary income

If elected, Biden would tax capital gains as ordinary income. Currently, the capital gains rate is 20 percent. Biden has said that he would nearly double the rate to 39.6 percent. 

Capital gains are already taxed twice under the current system –– the capital gains tax is levied on income that has already been subjected to the individual income tax and is then reinvested in the economy. This investment spurs job creation, economic growth, and economic productivity. 

In fact, taxing capital gains as ordinary income would decrease GDP by more than 3 percent over the long term and cost 700,000 jobs according to the Tax Foundation. In contrast, eliminating the double taxation of capital gains would increase household income across the board by an average of 3.8 percent, would lead to 2.7 percent higher GDP, and would create more than 500,000 new jobs.

This is an $800 billion tax hike over the next decade. 

2.   Raise the corporate tax rate 

Biden has repeatedly stated that he wants a full repeal of the Trump Tax Cuts and Jobs Act, which would raise the corporate tax rate to 35 percent. 

On other occasions, Biden has stated that he would raise the corporate tax rate to 28 percent, a drastic increase from the 21 percent corporate tax rate established under the Trump tax cuts. 

Even if he "only" raised it to 28 percent, the higher Biden corporate rate would be levied on top of the average state corporate rate of 4 to 5 percent, giving the U.S. a higher rate than the United Kingdom (19 percent), China (25 percent), Canada (26.8 percent), and Ireland (12.5 percent). It would also impose a tax rate higher than the current combined corporate rate across the 36 member Organization for Economic Development and Cooperation (OECD), which is currently 23.7 percent.

An increase in the corporate tax rate would also directly raise the cost of utility bills in all 50 states. In contrast, the Trump 21 percent corporate rate has unleashed American competitiveness at home and abroad, and has directly led to economic growth and job creation. 

Raising the corporate rate to 28 percent would be a $730 billion tax hike over the next decade

3.   Death tax increase

Under current law, when an individual dies and bequeaths property to an heir, the property’s cost basis receives a “step-up” to its fair market value at the time of the original owner’s death. 

Stepped-up basis protects the new owner from double taxation by eliminating the capital gains liability for any appreciation in value that occurred during the previous owner’s lifetime. Without stepped-up basis, the new owner would pay capital gains tax on accumulated value during the original owner’s life on top of the death tax.  

Biden would eliminate stepped-up basis, exposing taxpayers to double taxation and needless compliance costs. 

This is a $440 billion tax hike over the next decade. 

4.   15 percent corporate minimum tax 

Biden has proposed a “minimum book tax” of 15 percent on corporations that generate $100 million or more in revenue. This tax would essentially function as an Alternative Minimum Tax (AMT) for firms, and would inject needless complexity and confusion into the tax system. 

As such, the new Biden book tax would prevent American companies from using lawful deductions and credits upheld by bipartisan majorities in Congress and the Obama Administration. 

What Biden fails to realize is that companies can end up with a federal corporate tax bill of zero by using a lawful deductions and credits routinely upheld and extended by bipartisan Congressional majorities. This is not tax evasion –– these provisions, like the research and development credit, are vital for stimulating investment in the economy and American workers.  

The ironic twist here is that President Obama supported many of the same deductions and credits Biden now rails against. 

This is a $400 billion tax hike over the next decade. 

5.   21 percent tax on overseas income 

The Trump Tax Cuts and Jobs Act enacted several new provisions designed to move the U.S. closer to a territorial system of taxation by reducing the double taxation of American businesses and allowing trillions of dollars in previously stranded foreign income to be repatriated into our economy.

One of these provisions, Global Intangible Low Income Tax (GILTI), was designed to counteract base erosion.

Biden would double this tax to 21 percent, taxing businesses on income that has already been taxed overseas. Raising taxes on overseas income in this fashion further undermines the TCJA’s territorial system and moves the U.S. once again towards a worldwide system of taxation. 

This is a $340 billion tax hike over the next decade.  

6.   Impose a 28 percent cap on the value of itemized deductions

Biden revives an Obama-era idea to cap the value of itemized deductions at 28 percent, a move that would effectively eliminate tax deductions for mortgage interest, charitable contributions, out-of-pocket medical expenses, and HSA contributions, among others. 

This is a $310 billion tax hike over the next decade. 

7.   Sanctions for “tax avoidance” 

Biden would impose sanctions on places like Ireland, the Netherlands, the Cayman Islands, and Bermuda for “tax avoidance.” It is unclear how Biden would actually implement this. he

This is a $200 billion tax hike over the next decade.

8.   Raising the top income tax rate to 39.6 percent 

Biden would increase the top tax bracket from 37 percent to 39.6 percent.

This is part of Biden’s ultimate plan to repeal the Trump tax cuts in full. If Biden got his way, 

  • A family of four earning the median income of $73,000 would see a $2,000 tax increase.
  • A single parent (with one child) making $41,000 would see a $1,300 tax increase.
  • Millions of low and middle-income households would be stuck paying the Obamacare individual mandate tax.
  • Taxes would rise in every state and every congressional district.
  • Millions of households would see their child tax credit cut in half.
  • Millions of households would see their standard deduction cut in half.
     

Raising the top tax rate is a $90 billion tax hike over the next decade.

9.   Close real estate “loopholes” 

Biden would repeal several tax provisions used by real estate.

One of these provisions, like-kind exchanges, exists under Section 1031 of the tax code to promote investment. This allows an investor to defer paying taxes on certain assets when they use those earnings to invest in another, similar asset. This can be done again and again until the investor ultimately cashes out and protects against a lock out effect that would otherwise discourage investment.

Section 1031 is a vital and commonsense provision. Because there is a continuity of investment from any 1031 eligible transaction, there is no reason to arbitrarily punish reallocation of resources. If anything, this provision should be expanded so all capital gains are treated the same as like-kind exchanges.

This is a $70 billion tax hike over the next decade. 

10.    Energy tax hikes 

Biden supports a longheld left-wing priority of eliminating several deductions for fossil fuel companies. 

Biden mischaracterizes standard cost recovery practices employed by oil and natural gas producers as subsidies. Namely, Biden would eliminate expensing of exploration costs, a move that would make it even more costly for oil and natural gas companies to create energy.  

The Trump Tax Cuts and Jobs Act allowed all businesses to fully deduct the cost of new investments in the year they were purchased instead of deducting the cost gradually over several years. This drastically decreased tax complexity for businesses and incentivized more capital to flow into the American economy. 

Biden would prevent fossil fuel companies from fully expensing their assets solely to serve the far-left’s climate religion. 

Eliminating full-business expensing for fossil fuel companies would result in higher prices at the pump, increased utility bills, and fewer American energy jobs as companies flee the U.S. to avoid these industry-crippling tax hikes. 

 This is a $40 billion tax hike over the next decade.

Photo Credit: Gage Skidmore


Trump Economy Delivers Lowest Unemployment Rate in 50 Years

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Posted by Tom Hebert on Friday, January 10th, 2020, 6:50 AM PERMALINK

The Bureau of Labor Statistics’ December jobs report shows that President Trump’s economy has delivered the lowest unemployment rate in half a century at 3.5 percent. The U-6 rate, a measure encompassing underemployed workers and discouraged job-seekers, fell to an all-time low of 6.7 percent. 

The U.S. economy added 145,000 jobs in December, showing that the Trump economic agenda of tax cuts and regulatory relief is still working for American workers. Businesses have created over 7 million jobs since Trump was elected. 

In 34 of the past 37 months since Trump was elected, businesses have added more than 100,000 jobs a month. 734,000 construction jobs and 514,000 manufacturing jobs have been created since Trump was elected. 

Wages continued to climb in December. For production and non-supervisory workers, wages increased by 3 percent, continuing a 17-month trend. Wage growth for workers now outpaces wage growth for managers, and wage growth for those without a four-year college degree now outpaces wage growth for those with a four-year college degree. 

The labor force participation rate also held steady at 63.5 percent, and the total employment level rose to 158.8 million, a record-high. The underemployment rate, a measure encompassing undermployed Americans and discouraged job-seekers, fell to a record low of 6.7 percent. 

The stock market is also booming. When Trump was elected, the Dow Jones Industrial Average was at 18,000. The Dow has now hit 29,000 for the first time. 

The  solid December jobs numbers are continued evidence that the Republican Tax Cuts and Jobs Act is continuing to grow the economy two years after Trump signed it into law. 

Businesses have responded to the tax cuts by giving employees higher wages and creating new employee benefit programs, while utility companies are passing tax savings onto consumers in the form of lower rates.

Families are also seeing direct tax reduction – a family of four with annual income of $73,000 (median family income) will see a tax cut of more than $2,058, a 58 percent reduction in federal taxes. In net, households are paying an average of 24.9 percent in lower taxes according to a report released by H&R Block based on their clients’ tax returns. 

Tax cuts and deregulation championed by the Trump Administration are continuing to deliver a strong economy for all Americans.

Photo Credit: Gage Skidmore


Dem SALT Bill Another Attempt to Undermine Trump Tax Cuts

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Posted by Tom Hebert on Wednesday, December 11th, 2019, 8:00 AM PERMALINK

The Democrat-controlled House Ways and Means Committee will consider legislation that would roll back the Tax Cuts and Jobs Act (TCJA) by eroding the law’s $10,000 cap on state and local tax (SALT) deductions. While Democrats claim they care about the middle class, they are instead focusing on legislation that exclusively benefits their wealthy blue-state constituents. 

The Democrat legislation would temporarily raise the SALT cap for married couples to $20,000 in 2019, and then fully repealing the new cap in 2020 and 2021. Starting in 2022, the SALT cap would revert back to $10,000, although Democrats would likely push to extend the $20,000 cap for the next decade. Democrats would also raise the top tax rate from 37 percent to 39.6 percent and lower the income threshold for inclusion in the top bracket.  

Before the TCJA, taxpayers could deduct an unlimited amount of state and local taxes from their federal tax returns, a provision that mainly benefited the wealthy blue states. Technically, a New Yorker with a $20,000 state tax bill had access to the same SALT deduction as a Nebraskan with a $5,000 state tax bill. In a pre-TCJA world, the Nebraskan would take the standard deduction instead of the SALT deduction, while the New Yorker would itemize and take the full SALT deduction. This creates a de facto subsidy for blue states. 

Democrats are eager to repeal the SALT cap because it would be a windfall for their wealthy blue-state constituents. The unlimited deduction effectively created two different federal tax rates: one for the wealthy in blue states, and one for the middle class in red states. 

A recent report from the nonpartisan Joint Committee on Taxation shows that repealing the SALT cap would cut $40 billion in taxes for millionaires. In total, 94 percent of the tax breaks generated from ending the cap would be enjoyed by taxpayers making more than $200,000 a year. 

This stunt is another step in the left’s campaign to undermine President Trump, only this time, Democrats are enabling their blue-state constituents to commit federal tax arbitrage. New York Governor Andrew Cuomo attempted an end-run around the cap by allowing New Yorkers to pay their local property taxes into a state-run charitable fund. Senate Minority Leader Chuck Schumer recently forced 41 fellow Democrats to vote to overturn the SALT cap. 

The Trump administration and Republicans in Congress have rightfully defended the TCJA from Democrat attacks –– the IRS recently issued new rules and guidance to stop these blue-state schemes. 

The TCJA has been successful for Americans across the country. A family of four with annual income of $73,000 is seeing a 60 percent reduction in federal taxes, totaling more than $2,058.  Over 23 million families have benefited from the TCJA’s double child tax credit, and nearly 5 million families have not had to pay the onerous Alternative Minimum Tax thanks to the TCJA. GDP and wage growth also remain robust since Trump signed the TCJA into law. 

Democrats prove their hypocrisy in their constant battle to sabotage the TCJA. While Democrats claim to be the party of the middle class, they are fighting to dismantle the very law that gave 90 percent of middle class Americans a tax cut. While Democrats claim they want to raise taxes on the wealthy, they are fighting tooth and nail to deliver a massive windfall for their wealthy blue-state constituents. 

Ultimately, this Democrat SALT bill proves that the left will stop at nothing to undercut the Trump economic agenda.

Photo Credit: kidTruant


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