The following letter was sent today to Capitol Hill:

(Full letter PDF)

Dear Congressmen:

On behalf of the undersigned organizations, we write today to express strong concerns about the tax revenue component of the so-called “Chained CPI” proposal.

Changing the way the government measures inflation has both spending cut and tax increase effects.  This letter strictly speaks to the latter.  It’s important to note that Chained CPI can be restricted to just the spending side of the federal budget.

Chained CPI would, among other things, slow down the growth rate of individual income tax brackets.  Over time, American families and small employers will find themselves facing a higher marginal income tax rate than they would absent the change to Chained CPI.  Additionally, other tax provisions such as IRA and 401(k) contribution eligibility, etc. would grow more slowly if Chained CPI were adopted.   In its first decade of implementation, President Obama’s FY 2014 budget projects Chained CPI would raise taxes by $100 billion.

We are not opposed to Chained CPI under any circumstances.  In the context of bracket-flattening tax reform which is revenue-neutral or a net tax cut, Chained CPI may be an acceptable component.  But as a standalone tax measure, Chained CPI is a $100 billion tax increase in the first decade alone.

For these reasons, we oppose Chained CPI as a standalone tax policy measure because of the fact that it is a $100 billion tax increase on the American people.


Grover Norquist, Americans for Tax Reform
Andy Roth, Club for Growth
Mike Needham, Heritage Action for America
James Valvo, Americans for Prosperity
Wayne Brough, Freedom Works
Duane Pardee, National Taxpayers Union
Phil Kerpen, American Commitment
Jim Martin, 60 Plus Association