A Moratorium on Earning a Living: Why the Federal Eviction Moratorium Should Not be Extended

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Posted by Bryan Bashur on Monday, August 2nd, 2021, 6:35 PM PERMALINK

Extending the federal eviction moratorium, as Congressional Democrats and President Biden are proposing to do, is a case of unnecessary federal overreach that will harm property owners and continue disincentivizing people to return to work. 

Just last week, House Democrats scrambled to pull together enough votes to pass H.R. 4791, the Protecting Renters from Evictions Act, a bill to extend the moratorium through December. Ultimately, the House did not vote on the bill and recessed for the weekend—allowing the moratorium to expire on July 31. 

Previous decisions by a federal appellate court and the Supreme Court ruled the Centers for Disease Control and Prevention lacked the authority to mandate the moratorium, so any attempt by President Biden to extend the moratorium by executive fiat would be unconstitutional. 

The worst thing Congress could do right now is incentivize Americans to stay at home and not search for a job. 

Under the now-expired moratorium, tenants qualified if they earned less than $99,000 (or jointly $198,000) in 2020, were unable to pay rent because of substantial loss of income, if eviction would put them in a position of homelessness, or if they may have been exposed to COVID. 

Continuing the moratorium is an enormous cost to landlords and carries with it severe penalties if they fail to follow the rule. Landlords with mortgages have a debt service to pay on a timely basis. Without steady rental income, landlords could lose their residences to the banks. And if individual landlords fail to follow the CDC’s rule, they risk criminal penalties ranging from $100,000-$500,000 per event and one year in jail. 

The vilification of landlords in the media and by Democrats has skewed Americans’ view of who actually owns most rental properties. The landlords losing rental income are in fact not large corporations, but individuals who earn less than six figures. According to the U.S. Census Bureau, the vast majority of rental properties in the United States are owned by small individual investors, not large corporations. Out of 20 million rental properties counted by the Census Bureau, 14.3 million, or 71.6% are owned by individual investors. On average, these landlords earn approximately $73,600 per year

The federal government should not be providing more reasons for Americans to stay at home and collect welfare checks right now. The moratorium is not the only help provided to Americans – the federal government currently provides an additional $300 per week federal unemployment insurance—a subsidy that is making Americans complacent in their unemployment. Democrats previously gave people a $600 per week additional payment in the CARES Act passed last year and have provided several stimulus payments totaling $3,000. 

recent study by Ways and Means Republicans found that a family of four with both parents out of work will receive almost $110,000 from the federal government between April 2020 and September 2021. A family of four with one person unemployed would receive $67,824. 

Job opportunities also currently exist – the most recent data from the Bureau of Labor Statistics (BLS) found that there were 9.2 million job openings.

Hardworking taxpayers will continue to have to subsidize people who are more than happy to live off of what Nancy Pelosi and Congressional Democrats are willing to give them. 

Americans that lost their jobs due to the pandemic should and have received assistance from the federal government. However, the government should not be in the business of regulating contracts between tenants and landlords. The Democrat effort to extend this moratorium through the end of the year is unnecessary and will continue their pattern of subsidizing people not to work.

 

Photo Credit: Bruce.Emmerling


"C'Mon, Man": 10 Perplexing Items in the Bipartisan Infrastructure Bill

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Posted by Isabelle Morales on Monday, August 2nd, 2021, 5:45 PM PERMALINK

The 2,700-page bipartisan infrastructure agreement, released Sunday night, includes billions in funding for roads, bridges, waterways, and more. However, unsurprisingly, it is also riddled with a number of perplexing proposals, including wasteful spending, troubling regulations, and earmarks.

Below are just a few examples of these problematic provisions.

1. Woke Trucking: The bill attempts to get women interested in trucking careers. 

In Section 23007, the bill points out how underrepresented women are in trucking; specifically, women make up only 6.6 percent of truck drivers and 12.5 percent of all workers in truck transportation.  

In response, this legislation establishes and facilitates an advisory board, the “Women of Trucking Advisory Board,” to provide education, training, conduct outreach, and recruit women into the trucking industry.  

It’s likely, however, that the lack of women representation in trucking has more to do with their lack of interest than lack of knowledge. In which case, spending taxpayer money on these efforts seems especially foolish.  

2. Encourages children to walk or bike to school in order to reduce fuel consumption and air pollution. 

Under this bill, children as young as five years old, including those with disabilities, could be encouraged to walk or bike up to two miles to school.

Specifically, in Sec. 11119, the “Safe routes to school” section, the bill establishes a program in which each state would be given at least $1,000,000 to create routes to schools, up to two miles long, for students to walk or bike on. The stated goal of this program is to encourage “a healthy and active lifestyle from an early age; and to facilitate the planning, development, and implementation of projects and activities that will improve safety and reduce traffic, fuel consumption, and air pollution in the vicinity of schools.” 

Presumably, there are better ways to combat climate change than encouraging kindergartners to walk two miles to school.  

3. Spends a whopping $5 billion on “clean school buses and zero-emission school buses.” 

Section 71101 of this bill established a grant program which provides funds for the adoption of clean school buses and zero-emission school buses. 

Specifically, half of the funds would go towards “the adoption of clean school buses and zero-emission school buses,” while the other half would go towards, “the adoption of zero-emission school buses.” $1,000,000,000 is appropriated each year through 2026, costing taxpayers a total of $5,000,000,000 just for school buses. 

4. Aims to improve Amtrak’s onboard food and beverage experience. 

Section 22208 details another example of peculiar spending includes the establishment of a working group whose job it is to “provide recommendations to improve Amtrak’s onboard food and beverage service.” 

This working group must consist of individuals representing Amtrak, the labor organizations representing Amtrak employees, nonprofit organizations representing Amtrak passengers, and states that fund Amtrak routes.  

5. Appropriates $7.5 billion for a network electric vehicle charging stations. 

The bill includes $7.5 billion to develop electric vehicle charging stations across the country, despite EVs accounting for only 2 percent of new vehicle sales across the U.S. This spending on electric vehicle charging stations is a subsidy for luxury car owners - roughly 80 percent of EV owners have an annual income exceeding $100,000 and the sticker price of a new electric vehicle typically ranges from $40,000 – $80,000. Additionally, the California Air Resources Board estimates that "upward of 85 percent of EV charging occurs at home." 

6. Spends $10,000,000 on “pollinator-friendly practices." 

This bill establishes a program to provide grants to entities to “carry out activities to benefit pollinators on roadsides and highway rights-of-way, including the planting and seeding of native, locally appropriate grasses and wildflowers, including milkweed.”

Milkweed, specifically, is the plant which sustains monarch butterfly populations.

In order to save the bees and butterflies, the bill appropriates $2,000,000 each year through 2026. Grants to a specific entity can be up to $150,000.  

7. Appropriates $500,000,000 to fund colder, more porous pavement in cities. 

The bipartisan infrastructure bill establishes a discretionary grant program, the “Healthy Streets program,” to deploy cool pavements, in order to reduce pavement heat, and porous pavements, to allow water to pass through and infiltrate the subsoil. This program, detailed in Section 11406, would also fund expanded tree covering of streets.

The goals of this program are to improve air quality, mitigate “urban heat islands,” and reduce stormwater runoff.

Nonetheless, $500,000,000 in grant money for pavement is an astounding cost for something so trivial.

8. Lays the groundwork for a vehicle miles traveled tax (VMT).   

While a VMT is wildly unpopular, thus barring its inclusion in this specific bill, legislators still attempted to get as close as they could to it.  

In Section 13002, this bill establishes a national motor vehicle per-mile user fee pilot, which is supposed to demonstrate how a per-mile user fee could “restore and maintain the long-term solvency of the Highway Trust Fund” and “improve and maintain the surface transportation system.” This national pilot would cost $50,000,000 over the next five years. 

Further, in Section 13001, this bill incentivizes states to establish pilot programs for user fees as well through a grant program costing $75,000,000 over five years. 

These programs lay the groundwork for what would end up being an incredibly regressive, costly tax from the American public.  

9. Conducts "limousine research" and imposes several new regulations on motor vehicles.  

This legislation conducts "limousine research" and would impose new regulations making it more difficult for limousine operators to do their job. 

Section 23015 bars operators from introducing a limousine into interstate commerce unless the limousine operator has prominently disclosed in a clear and conspicuous notice the date of the most recent inspection, the results of the inspection, and any corrective action taken to ensure the vehicle passed inspection. 

10. Contains what appears to be many, many earmarks.  

The appropriations section of the bill contains funding for several niche projects, reeking of earmarks:  

  • “Mississippi River and Tributaries”, $808,000,000. 
  • $50,000,000 for the Upper Colorado River Basin. $50,000,000 shall be for endangered species recovery and conservation programs in the Colorado River Basin. 
  • For an additional amount for "Appalachian Regional Commission," $1,000,000,000 (which would greatly benefit West Virginia, home of Senator Joe Manchin (D-W.Va.)). 
  • For an additional amount for "Delta Regional Authority," $150,000,000. 
  • For an additional amount for "Denali Commission," $75,000,000 (greatly benefiting Alaska, home of Senator Lisa Murkowski (R-Alaska)). 
  • For an additional amount for "Northern Border Regional Commission," $150,000,000. 
  • For an additional amount for "Southeast Crescent Regional Commission," $5,000,000. 
  • For an additional amount for "Southwest Border Regional Commission," $1,250,000. 
  • $1,717,000,000, to remain available until expended, for Geographic Programs: 
    • $1,000,000,000 shall be for Great Lakes Restoration Initiative; 
    • $238,000,000 shall be for Chesapeake Bay; 
    • $24,000,000 shall be for San Francisco Bay; 
    • and many more.  

 

While the bipartisan infrastructure bill contains a notable amount of funding for roads, bridges, and other forms of infrastructure, it unfortunately was not immune to the inclusion of several wasteful provisions, problematic policies, and earmarks.  

Photo Credit: Gage Skidmore


IRS Caught Storing Critical Evidence in Break Rooms

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Posted by Michael Mirsky on Monday, August 2nd, 2021, 1:53 PM PERMALINK

Inspector General found that "some sites had evidence placed in hallways, stacked outside cubicles, and in break rooms."

President Biden's push to increase the size and power of the IRS has significant criminal justice ramifications. The agency has a long and poor track record of handling seized evidence. This habit does not serve the public well.

The IRS Criminal Investigation Division (IRS-CI) was repeatedly found to leave critical evidence sitting around in break rooms, hallways and stacked outside cubicles, according to a report by the Treasury Inspector General for Tax Administration (TIGTA). In addition, the report found that CI offices did not maintain an Evidence Access Control Log to record access to areas where evidence is stored:

During our walkthroughs at the CI offices, we observed that some sites had evidence placed in hallways, stacked outside cubicles, and in break rooms.  In addition, seven of the nine offices did not keep grand jury material in a separate, secure area.  The grand jury material was intermingled with non-grand jury evidence and other case file information.

The agency's careless approach to evidence storage has grave ramifications, as noted by the Inspector General:

In order for a seized item to be admissible as evidence, it is necessary to prove that the item is in the same condition as when it was seized.  If evidence is not stored properly, evidence may have been inappropriately disclosed, lost, tampered with, or stolen.  In addition, the chain of custody could be called into question, which could result in the item being deemed inadmissible in court.

The report suggests the IRS is an outlier in terms of its sloppy handling of evidence, compared to other federal law enforcement agencies:

In addition, we interviewed representatives from two other Federal law enforcement agencies to gain an understanding of how they maintained their chain of custody.  It was apparent from these interviews that both Federal agencies have an extensive chain of custody process.  For example, each agency limits access to the locked evidence room, which is maintained by an evidence custodian.  If evidence needs to be removed from the room, an agent must gain access through the evidence custodian and a record of that access is maintained.  This process helps ensure that evidence does not become lost or misplaced and helps keep the chain of custody from being broken.

Each IRS-CI special agent has the authority to investigate, inquire, and receive information. Of the investigative techniques available to agents, one of the most frequently used is the authority to conduct searches and issue search and seizure warrants. The authority for CI personnel to serve search warrants comes from Title 26 U.S.C. and the authority to seize assets and force taxpayers to forfeit property originates from Title 18, Title 26, and Title 31 of the U.S.C. 

The Federal Government is responsible for properly maintaining the chain of custody for any seized items. CI agents must be able to prove it is the same item that was seized and that the item is in the same condition as when it was seized in order for that seized item to be admissible as evidence.

Grand jury-related evidence must be kept separate from other non-grand jury evidence. Despite these clear directives, the CI has routinely ignored protocol, violating the rights of the taxpayers they are supposed to protect. 

Evidence was stored improperly

IRS-CI agents blatantly violated their own policies when it came to storing evidence. Specifically, agents violated The Federal Rules of Criminal Procedure Rule 6(e)(2) which states “grand jury material is secret and should be stored in either a lock-bar file cabinet or in a secured and locked room.”

IRS-CI offices lack Evidence Access Control Logs

The Evidence Access Control Log is a tool used to record and document all access to controlled areas where evidence is stored. This information includes who accesses the evidence, what evidence was accessed, and the specific reason for the access. While these logs are an essential piece of the chain of custody, CI managers did not feel the need to set it up. This lack of oversight can create several problems. As noted in the report:

When we asked why an Evidence Access Control Log was not being maintained, local CI management did not think the log was necessary for the type of evidence that they usually maintain, such as seized paper documents.  However, according to IRS policy, ‘in order for documents or other physical objects to be admissible as evidence, it is necessary to prove the items are in the same condition as when they were seized, since failure to maintain the evidence in its original condition could jeopardize admissibility.’  The evidence we found stored in open areas within the CI offices could result in chain of custody concerns, which could jeopardize the investigation and any subsequent court proceeding.

Given the history the IRS has in violating the basic due process rights of the American people, the Biden proposal to give the agency even more power and money are alarming to taxpayers.


Government Cash Grab Could Jeopardize Fire Preparedness Out West

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Posted on Monday, August 2nd, 2021, 11:06 AM PERMALINK

In a new op-ed published over the weekend, ATR's Patrick Gleason explains how unions are seeking to forestall needed pension reform with a new scheme to monopolize local EMS services. Gleason's piece looks at how this effort to delay necessary pension reform will harm taxpayers and lead to diminished fire prevention services. 

ForbesGovernment Cash Grab Could Jeopardize Fire Preparedness Out West

After a 2020 that saw 10.1 million acres in the U.S. burned by wildfire, the second most since 1960, wildfire season is once again upon west coast communities. That, however, isn’t stopping California and Washington State officials from advancing a new policy that would reduce the number of fire engine fleets while saddling fire departments with responsibilities that have nothing to do with preventing, putting out, and mitigating the spread of fire. Such would be the result of Tacoma’s proposed takeover of EMS and ambulance services. 

Tacoma City Council Member Chris Beale explains how the city manager’s proposal to have the fire department takeover all EMS services, which are currently handled by a private company, will expand the department’s responsibilities: 

“The city is planning to take over Basic Life Transport Services (BLS) from the ambulance company AMR,” Council Member Beale told Grit City Magazine about the proposal. “In order to do that we would shift firefighters from fire engines to ambulances. We will also be adding a Behavioral Health Unit (to respond to calls involving people experiencing a mental health crisis).” 

AMR, the private company currently responsible for ambulance service in Tacoma, is staffed by professionals whose sole focus is providing medical care. Under the proposed fire department takeover of all EMS services, patients needing ambulance-facilitated emergency care in Tacoma would be treated by flex workers with both EMT training and firefighting responsibilities. 

Many are concerned that the proposal will translate into diminished fire and emergency medical services for Tacoma residents and visitors. That concern is justified, according to city officials like Council Member Beale, who confirmed last year that “the current proposed budget would lead to fewer fire engines.” 

To continue reading this article, click here

Photo Credit: Joey Zanotti


List of Tax Reform Good News

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Posted by John Kartch on Friday, July 30th, 2021, 1:22 PM PERMALINK

1,233 examples of pay raises, new job creation, facility and product line expansions, special bonuses, utility rate reductions, 401(k) match increases and employee benefit increases attributed to the Tax Cuts and Jobs Act:

Full A-Z national compilation (PDF)

State lists:

Ala.   Alaska   Ariz.   Ark.   Calif.   Colo.   Conn.   Del.  D.C.   Fla.   Ga.   Hawaii   Idaho   Ill.   Ind.   Iowa   Kan.   Ky.   La.   Maine   Md.   Mass.   Mich.   Minn.   Miss.   Mo.   Mont.   Neb.   Nev.   N.H.   N.J.   N.M.   N.Y.   N.C.   N.D.   Ohio   Okla.   Ore.   Pa.   R.I.   S.C.    S.D.   Tenn.   Texas   Utah   Vt.   Va.   Wash.   W. Va.   Wis.   Wyo.

Specialized lists:

Opportunity Zones

Small businesses

Manufacturers

Craft beverage producers

Utilities

Examples of companies providing new employee and family benefits

(Pictured at top: The Tax Cuts & Jobs Act helped Rod’s Harvest Foods in St. Ignatius, Montana raise employee wages and bonuses)

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Rep. Kevin Hern, Ways and Means Republicans Urge Biden Admin to Not Repeal FDII Tax Rules

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Posted by Alex Hendrie on Friday, July 30th, 2021, 12:45 PM PERMALINK

Congressman Kevin Hern (R-Okla.) last week led a letter urging Janet Yellen, the secretary for the Department of the Treasury, to reconsider repealing the foreign derived intangible income (FDII) tax rules. 

Rep. Hern was joined by all Republican members of the Ways and Means Committee: Ranking Member Kevin Brady (R-Texas), Devin Nunes (R-Calif.), Rep. Adrian Smith (R-Neb.), Rep. Jodey C. Arrington (R-Texas), Rep. Vern Buchanan (R-Fla.), Rep. Ron Estes (R-Kan.), Rep. Drew Ferguson (R-Ga,), Rep. Mike Kelly (R-Pa.), Rep. Darin LaHood (R-Ill.), Rep. Carol D. Miller (R-W.Va.), Rep. Tom Reed (R-N.Y.), Rep. Tom Rice (R-S.C.), Rep. David Schweikert (R-Ariz.), Rep. Jason Smith (R-Mo.), Rep. Lloyd Smucker (R-Pa.), Rep. Jackie Walorski (R-Ind.), and Rep. Brad Wenstrup (R-Ohio).

President Biden has proposed repealing the FDII deduction as part of his Fiscal Year 2022 budget. In all, Biden has called for 30 tax increases totaling almost $3 trillion over the next decade.

If this tax increase goes into effect, it will ship American intellectual property and jobs overseas, creating long-term economic damage to the country. This proposal would undermine American competitiveness and benefit foreign countries like China that provide extensive and generous tax credits and subsidies to incentivize IP.

What is FDII? 

FDII is one of several international tax provisions passed into law in the 2017 Tax Cuts and Jobs Act. FDII acts in concert with another provision, GILTI (global intangible low-tax income) to apply a “carrot and stick” approach to the taxation of intangible income (income derived from rents, royalties etc.) that is easily allocated to low-tax jurisdictions. 

Under this system, U.S. taxpayers are provided a tax cut on foreign income generated from IP held in the U.S. They face a corresponding tax penalty on income from IP held overseas. 

FDII provides the benefit through a deduction for qualifying “deemed intangible income” equal to 37.5 percent, creating an effective rate of 13.125 percent on qualifying income when taken against the current 21 percent corporate rate.

Effective 2026, the FDII deduction will decrease to 21.87 percent, creating a 16.41 percent rate on qualifying income. 

Repealing FDII would benefit America’s rivals like China and Europe 

By repealing FDII, the Biden administration would disadvantage U.S. businesses with foreign competitors in China and Europe. Compared to the tax provisions offered by many countries, the tax benefit associated with FDII is relatively modest. However, repealing it threatens to leave American businesses vastly far behind foreign competitors when it comes to promoting IP. 

For instance, China recently enacted a 200 percent “super deduction” for eligible research and development expenses and has a preferential 15 percent tax rate for high-tech enterprises.    

Promoting American IP will help U.S. competitiveness and job creation 

As it stands, the U.S. already provides relatively modest tax benefits to IP in comparison to the generous tax subsidies provided by many foreign countries. 

In fact, according to a 2020 study by the Information Technology & Innovation Foundation, the U.S. ranks 24th out of 34 comparable countries in the Organization for Economic Cooperation and Development (OECD) of the four-member BRICs (Brazil, Russia, India, and China). 

The U.S. is significantly behind in this space and policymakers should be doing more, not less to promote IP. Doing so would have significant economic benefits for American workers and businesses. 

According to a 2016 study by the United States Patent and Trademark Office, IP-intensive industries directly and indirectly supported over 45 million jobs, or about thirty percent of all American workers. These jobs are high-paying – a worker in IP intensive industry earned an average of 46 percent higher wages than the average wage of workers in a non-IP intensive industry. 

Similarly, the Bureau of Labor Statistics found that jobs tied to R&D pay an average of $134,978 – 2.4 times higher than the average wage. 

There is Strong Historical Support for Incentivizing IP Through the Tax Code 

In the past, Democrats and Republicans believed that the tax code should help encourage IP in the U.S. For instance, a 2015 Senate Finance Committee International Tax Reform Working Group co-chaired by Senator Rob Portman (R-Ohio) and Senator Chuck Schumer (D-NY) concluded that Congress should encourage the development and ownership of IP in the US: 

“The co-chairs agree that we must take legislative action soon to combat the efforts of other countries to attract highly mobile U.S. corporate income through the implementation of our own innovation box regime that encourages the development and ownership of IP in the United States, along with associated domestic manufacturing. They continue to work to determine appropriate eligibility criteria for covered IP, a nexus standard that incentivizes U.S. research, manufacturing, and production, as well as a mechanism for the domestication of currently offshore IP.” 

At the time, there were several proposals by lawmakers to create new tax incentives to promote American IP. For instance, as a report by the Congressional Research Service noted, Congressman Richie Neal (D-Mass.) had one proposal while Senator Dianne Feinstein (D-Calif.) had another: 

“Proposals for a patent box in the United States include a draft proposal by Representatives Boustany and Neal, the Innovation Promotion Act of 2015, proposed legislation made by Senator Feinstein in the 112th Congress, and a bill introduced by Representative Schwartz in the 113th Congress (H.R. 2605). The Feinstein proposal provided a 15% tax rate on income from patents developed and used for manufacture in the United States, whereas the Boustany-Neal proposal and H.R. 2605 allowed a 71% deduction of income, which produces an effective 10% statutory rate on income in the patent box.” 

As Rep. Hern states in his letter, “We know that when the businesses and workers in our districts have a level playing field, they can compete and win, even in an increasingly competitive global marketplace.” 

All lawmakers should object to repealing FDII tax rules, so as to maintain American competitiveness and protect American intellectual property and jobs. 

Photo Credit: U.S. House of Representatives


ATR Supports Sen. Ron Johnson's Bill to Repeal Obamacare’s Failed Multi-State Program

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Posted by Isabelle Morales on Friday, July 30th, 2021, 12:25 PM PERMALINK

Americans for Tax Reform today sent a letter to Senator Ron Johnson (R-Wis.) in support of his bill to repeal Obamacare’s failed Multi-State Program, the Repeal Insurance Plans of the Multi-State Program Act (RIP MSP Act). This attempt at a "public option" failed, yet continues to cost taxpayers money.

The cosponsors of this important piece of legislation include Senators Wicker (R-Miss.), Hyde-Smith (R-Miss.), Toomey (R-Pa.), Lee (R-Utah), Lummis (R-Wyo.), Barrasso (R-Wyo.), Braun (R-Ind.), Cramer (R-N.D.), Lankford (R-Okla.), Inhofe (R-Okla.), Blackburn (R-Tenn.), and Paul (R-Ky.).

Click here to view the letter or read below.

 

July 30, 2021 

The Honorable Ron Johnson
United States Senate
328 Hart Senate Office Building
Washington, DC 20510

Dear Senator Johnson: 

I write in support of the Repeal Insurance Plans of the Multi-State Program Act (RIP MSP Act), legislation you have introduced to repeal Obamacare’s failed Multi-State Program. This “multi-state” program has failed miserably, yet still costs taxpayers millions of dollars each year. All members of Congress should support and co-sponsor this important piece of legislation.  

ATR also applauds the existing cosponsors of this bill, Senators Wicker (R-Miss.), Hyde-Smith (R-Miss.), Toomey (R-Pa.), Lee (R-Utah), Lummis (R-Wyo.), Barrasso (R-Wyo.), Braun (R-Ind.), Cramer (R-N.D.), Lankford (R-Okla.), Inhofe (R-Okla.), Blackburn (R-Tenn.), and Paul (R-Ky.).

Section 1334 of the Affordable Care Act required the Office of Personnel Management to contract with at least two national health plans to offer coverage to Americans in all fifty states. At least one of these plans had to be a non-profit health plan. These plans were intended to compete directly with private insurance plans in each state. 

Only one state, Arkansas, agreed to offer an MSP option in 2019. After spending $54 million trying to implement this plan nationwide, 49 states and the District of Columbia declined to participate. One reason for was that insurers were concerned with meeting regulatory standards from the federal government and all 50 sets of state regulators.  

The MSP had a flawed structure. Companies were not incentivized to participate and many were actively turned off by the idea of participating. At one point, OPM even attempted to entice more insurers to participate by relaxing requirements to sell statewide. Still, insurers were uninterested. 

In many ways, this program is a step toward the creation of a “public option” health plan, which if fully implemented, will lead to massive tax hikes, healthcare shortages, and cause damage to healthcare providers.

This was not Obamacare’s only attempt at moving towards a public option. In 2013, the ACA had established 23 Consumer Operated and Oriented Plans (CO-OPs), nonprofit insurance plans designed to compete with health insurance companies. Today, only three of these co-ops remain. Evidently, both MSPs and co-ops are prime examples of how a “public option” might fare in the United States. Unfortunately, taxpayers had to lose billions of dollars to come to this seemingly obvious conclusion.

The MSP, specifically, was ill-advised and ill-planned. It was not subject to any congressional hearings, committee consideration, or debate. Democratic advisors at the time, like John McDonough, described the discussion around this policy as “definitely not a thoughtful, nuanced conversation.” 

Still, taxpayers continue to pay for administrative costs to run this program.  

I urge all Senators to support the RIP MSP Act to repeal the Obamacare Multi-State Program. Not only will this important legislation repeal a failed provision of Obamacare that was a steppingstone toward the public option, but it will also save taxpayers millions of dollars.

 

Onward,

Grover Norquist

President, Americans for Tax Reform

Photo Credit: Gage Skidmore


ATR Opposes Congressional Effort to Keep Adults Smoking Cigarettes

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Posted by Karl Abramson on Thursday, July 29th, 2021, 4:55 PM PERMALINK

Earlier today, Americans for Tax Reform sent a letter to the United States Senate in opposition to the Resources to Prevent Youth Vaping Act, legislation that takes aim at e-cigarette manufacturers and the lifesaving products they produce. Should the proposal be enacted, vape manufacturers would be required to pay user fees to the Food and Drug Administration (FDA) that would be used to increase awareness of the “danger” of e-cigarettes, even though vaping has been conclusively shown to be 95% less harmful than traditional cigarettes. 

While it is obvious that underage persons should not be consuming e-cigarettes, this bill would lead to an increase cigarette consumption, harming the health of American youths more than e-cigarettes ever could. 

Tim Andrews, ATR’s Director of Consumer Issues, wrote: “It would be incredibly cruel to force e-cigarette manufacturers to fund FDA misinformation. The products that these businesses creating are saving lives every day. Further, e-cigarettes have the potential to decrease socioeconomic disparities in healthcare by aiding disadvantaged populations with smoking cessation.” 

Cigarette smoking is the leading cause of preventable death in the United States and is responsible for roughly 480,000 deaths every year. Public policy, particularly when related to public health, must take into account all available data and evidence. This proposal fails to consider the lifesaving benefits of e-cigarettes. It will keep adults smoking, and dying from, traditional cigarettes.” 

Andrews concluded: “E-cigarettes are not tobacco products. There is no reason for Congress to impose rules and regulations that treat them as such. Vaping products are the most effective method of helping smokers quit the deadly habit of cigarettes and there is zero evidence demonstrating e-cigarettes are a pathway to cigarette smoking. Rather, more than 60 public health organizations agree that e-cigarettes are a pathway away from smoking. In the interests of public health, we call upon you to accept the science and vote against the Resources to Prevent Youth Vaping Act. Millions of lives quite literally depend upon it.” 

The full letter can be read here.

Photo Credit: David Maiolo

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Members of Congress Promote Cigarette Smoking with Push to Vilify Vape Businesses

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Posted by Karl Abramson on Thursday, July 29th, 2021, 3:53 PM PERMALINK

On July 23, 2021, a group of eight bipartisan legislators in the United States Senate and House of Representatives introduced the Resources to Prevent Youth Vaping Act, legislation that would force e-cigarette manufacturers to fund an anti-vaping misinformation campaign with fees paid to the Food and Drug Administration (FDA).  

A press release that accompanied the introduction of the bill contained numerous myths, misconceptions, and downright lies about e-cigarettes and the vaping industry. It is highly disappointing that the six U.S. Senators and two Representatives sponsoring the legislation have chosen to engage in fear-based deception, rather than accepting the science on e-cigarettes.  

However, the problem is larger than just a few misguided lawmakers. More than half of adult cigarette smokers, the people for who vaping was invented, believe that e-cigarettes are at least as harmful, or more harmful, than traditional cigarettes. This could not be farther from the truth, as vaping has been scientifically shown to be 95% safer than cigarettes.  

Legislation like the Resources to Prevent Youth Vaping Act exacerbates this problem and will keep more adults smoking, and dying from, traditional cigarettes. As such, it is crucial to communicate the truth about vaping. Let’s examine some of the allegations from the press release. 

Claim: “Electronic nicotine devices should be subject to the same user fees that the FDA assesses on the manufacturers and importers of cigarettes and other forms of tobacco” - Senator Mitt Romney (R-Utah) 

Truth: E-cigarettes and traditional cigarettes share very few characteristics. E-cigarettes heat a nicotine-containing liquid to create a vapor. Cigarettes have a combustion process which creates tar and other harmful chemicals that cause cancer, heart disease, and other serious illnesses. Vaping does not have a combustion process, allowing users to consume nicotine while decreasing the harm they are subjected to. Nicotine is not a carcinogen. Rather, it is a highly addictive but relatively benign substance, much like caffeine, that does not cause short or long-term harm when separated from the dangerous chemicals in cigarettes. 

Claim: “We know the numbers – more and more teens and high school students are using vapor products.” - Senator Lisa Murkowski (R-Alaska) 

Truth: Clearly, Senator Murkowski does not know the numbers. According to data from the Center for Disease Control and Prevention, the number of underage persons who had vaped nicotine in the past 30 days decreased by 27.2% between 2019 and 2020. National Youth Tobacco Survey Data, the most recent data available, shows that past-30-day youth vaping rates are lower today than they were in 2015. 

Claim: “Big Vape has hooked nearly four million kids on e-cigarettes, creating a vaping epidemic that is threatening our next generation with a lifetime of nicotine addiction and disease.” - Senator Richard Durbin (D-Ill.) 

Truth: Senator Durbin’s attempt to demonize vaping manufacturers by branding them “Big Vape” is unequivocally false. The Small Business Administration, a government agency that provides support to American entrepreneurs, has correctly noted that “small businesses created the (vaping) industry and have been drivers of the industry’s major innovations”. 

More Truth: There are not four million kids “hooked” on e-cigarettes. Senator Durbin would like you to believe that a teenager who vapes once or twice a month is addicted to vaping but that, of course, is not true. Approximately 3% of teenagers are daily users of vape products and 67% of daily users previously smoked cigarettes. Obviously, no teenagers should be using vaping products but teenage cigarette smokers who switch to vaping are reducing the harm they are exposed to. Senator Durbin would prefer they smoke. 

Even More Truth: There is zero evidence that vaping causes disease. Shockingly, Senator Durbin is wrong once again. 

The bill was introduced by U.S. Senators Mitt Romney (R-Utah), Jeanne Shaheen (D-N.H.), Lisa Murkowski (R-Alaska), Richard Durbin (D-Ill.), Susan Collins (R-Maine), Tammy Baldwin (D-Wis.), and U.S. Representatives Cheri Bustos (IL-17), and Brian Fitzpatrick (PA-01). 

Shortly after the bill was introduced, Americans for Tax Reform sent a letter to members of the U.S. Senate and House of Representatives, urging them to oppose this disastrous proposal. That letter can be read here

Photo Credit: Piqsels

More from Americans for Tax Reform


Senate GOP Unified Against Biden’s Second Death Tax

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Posted by Regina Kelley on Thursday, July 29th, 2021, 3:42 PM PERMALINK

Recently, all 50 Senate Republicans sent a letter urging President Biden not to repeal stepped-up in basis, raising taxes on family-owned businesses. If step-up in basis is repealed, family-owned businesses would suffer much higher tax liabilities, hurting the businesses themselves and those they employ.

The letter was signed by Senate Minority Leader Mitch McConnell (R-Ky.), Senate Minority Whip John Thune (R-S.Dak.), Senator Finance Committee Ranking Member Mike Crapo (R-Idaho) and Senators John Boozman (R-Ariz.), Chuck Grassley (R-Iowa) and Steve Daines (R-Mont.). Biden proposed removing the stepped-up in basis provision in his budget along with trillions of dollars of other tax increases.

Stepped-up in basis is a provision that allows decedents to pass down their family businesses by protecting it against double taxation. This is done by “stepping up” the purchase price of the asset to the current market value. Repealing stepped-up in basis means that the unrealized gains passed down to the heirs of a family business would be taxed. This tax would be separate from, and in addition to, the existing 40 percent death tax.

Not only would this be a tax increase, but it would also increase tax complexity. If a taxpayer is unable to determine how much they bought the asset for, they may need to pay the 43.4 percent capital gains tax on the entire value of that asset, many of which could have been bought decades ago.

The letter outlines the many problems with President Biden’s proposal to remove stepped-up in basis, including job-loss and increased tax liability. 

A study by E&Y that found by removing stepped-up in basis, the federal government would eliminate 80,000 jobs each year over the next decade. 

Another study from Texas A&M Agricultural and Food Policy Center found that 98 percent of the farms in its 30-state database would be impacted with a median increase in tax liabilities of $726,104 per farm. 

Many asset-rich, cash-poor businesses would have to liquidate their assets or lose their entire business if the Biden Administration imposes this second death tax. In a Ways and Means Committee Hearing, multiple American business owners explained how removing stepped-up in basis would harm their businesses and force their heirs to pay a tax that would force them to liquidate their assets.

Senate Republicans should be applauded for standing up for family-owned business and standing against the massive tax increases that Biden is proposing.

Photo Credit: Gage Skidmore


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