Chaotic Markup Shows Klobuchar Antitrust Bill Is Nowhere Near Ready for Senate Floor

Share on Facebook
Tweet this Story
Pin this Image

Posted by Tom Hebert on Thursday, January 20th, 2022, 5:15 PM PERMALINK

In a 16-6 vote Thursday, the Senate Judiciary Committee advanced S. 2992, the “American Choice and Innovation Online Act.” 

While Democrats and the media are painting this as a major step forward for the legislation, in reality the markup showed that S. 2992 is nowhere close to being ready for a floor vote. Lawmakers proposed a staggering 117 amendments to the legislation - clear evidence that a lot of work on the bill remains to be done. 

Just like its House companion, S. 2992 was rushed to a full committee markup without a legislative hearing. Members had no public opportunity to debate or discuss the ramifications of the legislation before today’s markup. 

Even supporters acknowledged that the bill was a work in progress. Sen. Alex Padilla (D-Calif.) raised doubts that self-preferencing was even a problem that Congress needed to solve, saying that he was “...not yet convinced that this bill as currently drafted will actually provide the net benefit to consumers that we’re seeking.” Sen. John Kennedy (R-La.) said that he anticipates sweeping changes to the bill before a full Senate vote, and if he’s not involved in making those changes, told lawmakers that “[he’ll] be off the bill faster than you can say Big Tech.” 

Lawmakers across the spectrum expressed confusion over which companies the bill will actually cover. The original version targeted companies with a market capitalization of $550 billion and 50 million monthly users. Sen. Amy Klobuchar’s (D-Minn.) manager’s amendment expanded this definition to include privately-held companies with $30 billion in annual revenue and companies with over a billion monthly users. This new covered platform designation goes far beyond Big Tech and includes companies in the grocery, professional services, and agriculture sectors. 

In defense of the consumer welfare standard and a consumer-based approach to antitrust regulation, six Senators voted against moving S. 2992 out of committee: Sens. Thom Tillis (R-N.C.), Marsha Blackburn (R-Tenn.), Tom Cotton (R-Ark.) John Cornyn (R-Texas), Ben Sasse (R-Neb.), and Sen. Mike Lee (R-Utah). 

While antitrust crusaders may tout today’s markup as a victory, any fair observer would conclude that S. 2992 is an incredibly flawed piece of legislation that is nowhere near ready for the Senate floor. 

Photo Credit: Fortune Live Media


Report: IRS Fails to Provide Adequate Taxpayer Services

Share on Facebook
Tweet this Story
Pin this Image

Posted by Isabelle Morales on Thursday, January 20th, 2022, 5:05 PM PERMALINK

The IRS fails miserably at providing adequate taxpayer services, according to the National Taxpayer Advocate's 2022's Annual Report to Congress. NTA's report details numerous problems with the IRS's taxpayer services including that taxpayers face significant challenges reaching the IRS and that the IRS’s digital communications tools are too limited.

Importantly, these problems pre-dated the coronavirus pandemic.  

As the report notes, taxpayers face significant challenges reaching IRS employees. The NTA notes that only 11 percent of calls were answered by a real person. In March of 2020, only 4 percent of calls were answered: 

“During fiscal year (FY) 2021, the IRS received a record 282 million calls. Of those calls, 32 million, or 11 percent, were answered by CSRs…  

The Level of Service (LOS) for the Accounts Management (AM) phone lines fell as low as four percent in March when Congress enacted sweeping legislation favorably impacting taxpayers’ 2020 taxes. Calls were not answered, leaving taxpayers wondering how the new legislation impacted their tax returns. In 2021, taxpayers experienced significant challenges while LOS fell to an all-time low.” 

The IRS has been incapable of keeping up with phone calls for decades.  

In 2013, NTA’s Nina Olson said that IRS customer service had not improved since 1998. "No, we don't have improved customer service," she said. Olsen was a community tax law project organizer during the IRS reform efforts, and was even invited to testify before the House Ways and Means Oversight Subcommittee in 1997 and before the Finance Committee in 1998. 

In 2015, the IRS "courtesy disconnected" 8.8 million taxpayers, according to the National Taxpayer Advocate. “Courtesy disconnects,” is a term used by the IRS itself, a practice in which the agency hangs up on taxpayers when wait times are long.

The report also notes that IRS digital tools are limited, making communication with the agency unnecessarily difficult. As report notes:  

“Despite its progress, the IRS has yet to develop and adopt a one-stop solution for online and digital offerings that combines communications and interactions with individual and business taxpayers as well as with tax professionals who represent these taxpayers... Imagine what the IRS can accomplish and how much time and effort it could save if taxpayers could easily access their tax information online. The National Taxpayer Advocate wants to stop imagining this; the IRS needs to have robust online accounts available for all taxpayers and their representatives.” 

Advancement in digital tools, the report suggests, could be done with the IRS’s existing resources:  

“The IRS needs to balance budget restrictions, use of existing resources, and taxpayer needs for each implementation.” 

Again, these are not new issues. In past years, the IRS failed to improve communication issues. Congress passed the IRS Restructuring and Reform Act of 1998 (RRA 98), which sought to solve these issues. As the 2021 NTA report notes, “However, more than 20 years later, the IRS still has not meaningfully implemented this provision regarding its correspondence audit programs.” 

Unfortunately, the agency has little regard for improving taxpayers’ experience working with the IRS. In fact, many IRS employees prefer to be hard to reach. One 2012 NTA blog outlines how Tax Examiners can simply disregard taxpayer cases because they know taxpayers may not be able to follow up on promised actions: 

“No one employee must follow up on his or her actions or decisions with respect to a case or speak with the taxpayer about those decisions. Thus, it becomes easier for Tax Examiners to reduce taxpayers to mere paper to be processed or calls to be answered. In turn, it is easier to be careless or to succumb to the pressure to move on to the next case because Tax Examiners know the taxpayers will not be able to reach them again to follow up on promised actions.” 

While the IRS insists all these problems are a result of a lack of funding, it is evident that each problem existed well-before any IRS budget cuts or COVID complications. The problem is not funding, but the way the agency is organized and run.    

In the Democrats socialist spending bill, $44.9 billion would have gone directly towards enforcement. The agency would have received a comparatively meager $1.93 billion in funding for taxpayer services, which would be spread thin between pre-filing assistance and education, filing and account services, and taxpayer advocacy services. 

The NTA’s Annual Report to Congress reiterates what most Americans already know: the IRS is woefully inadequate at doing its job, even when it has all the resources it needs.

Photo Credit: "A frustrated man sitting at a desk." by LaurMG is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported license.

More from Americans for Tax Reform


New IRS Reporting Requirements Set to Hit Small Businesses, Gig Workers

Share on Facebook
Tweet this Story
Pin this Image

Posted by Jack Baum on Thursday, January 20th, 2022, 2:47 PM PERMALINK

In 2022, freelancers, small businesses, and independent contractors will experience a more burdensome and complex tax season due to new reporting requirements that came into effect through legislation passed by Democrats last year. 

These changes were snuck into President Biden’s $1.9 trillion stimulus bill passed on a party-line basis and signed into law last March. The legislation expanded 1099-K reporting requirements by lowering the reporting threshold from $20,000 to $600 and eliminating the threshold requirement that taxpayers must have more than 200 transactions in one year to file. 

These new requirements will significantly increase tax complexity for millions of independent contractors, small businesses, and freelancers by increasing what they have to report to the federal government. In essence, this creates new paperwork burdens that will disproportionately harm low and middle-class taxpayers that have been decimated by the coronavirus pandemic over the last two years.

The legislation also extends the 1099-K reporting to "specified electronic payment processors" and will harm gig economy workers who are compensated via online services such as Venmo, PayPal, Etsy sellers, Uber and Lyft drivers, and even food delivery workers. These workers typically work in these job fields due to the flexibility that they can provide.

This is not the first time Democrats have enacted burdensome new reporting requirements. In 2010, lawmakers included new 1099 reporting requirements in Obamacare. This law required small businesses to send 1099 forms for all purchases of goods and services over $600 annually. Soon after this provision was signed into law, the National Taxpayer Advocate raised concerns that these reporting requirements would cause “disproportionate” harm to small businesses and do little to improve tax compliance. 

This provision was so unpopular with the American public that it was quickly repealed in 2011 with a bipartisan vote of 87 to 12 in the Senate and 314 to 112 in the House. The Obama administration even hailed repeal of the provision a “big win” for small businesses in a press release.

These new reporting requirements should be swiftly repealed as proposed by Congresswoman Carol Miller (R-W.Va.) who has introduced H.R.3425, the Saving Gig Economy Taxpayers Act. Senator Rick Scott (R-Fla.), has introduced similar legislation in the Senate.

After two years of economic unpredictability, we should be looking to support gig economy workers and small businesses who have struggled and persevered throughout the pandemic. The new 1099-K reporting requirements do the exact opposite, and will create unneeded complexity for millions of taxpayers this year.

Photo Credit: "Home of the Internal Revenue Service" by Joshua Doubek is licensed under CC-BY-SA-3.0

More from Americans for Tax Reform


5 Things to Know About Biden’s First Year in Office

Share on Facebook
Tweet this Story
Pin this Image

Posted by Isabelle Morales on Thursday, January 20th, 2022, 11:50 AM PERMALINK

President Biden’s first year in office has been disastrous.   

He has been responsible for severe inflation and the demise of American energy independence, but has also pushed harmful policies such as supersizing of the IRS, the largest tax hike since 1968, and socialized healthcare.  

Below are five things you should know about Biden’s first year in office:  

1) Inflation Surged to Its Highest Levels in 40 Years  

Inflation has surged across the country due to out-of-control government spending, the administration’s policy of paying Americans not to work, and supply chain issues. In December, the consumer price index increased by 7 percent on an annualized basis, a 40-year high. This marked a steep increase from January 2021 when annual inflation was at a stable 1.4 percent

Rampant inflation is harming Americans across the country. The average U.S. household spent $3,500 more in 2021 due to inflation, according to a Penn Wharton University of Pennsylvania Budget Model analysis.      

Low-income households were disproportionately harmed. In the past year, the bottom 20 percent spent $309 more on food, $761 more on energy, $476 more on shelter, $390 on other commodities, and $224 on other services.   

Not only is inflation increasing household costs for consumers, but it could also have long lasting economic damage by eroding purchasing power. This is especially alarming given that wages are decreasing - real average hourly earnings dropped by 2.4 percent on an annualized basis in December.   

According to a Gallup poll, 71 percent of low-income households have reported experiencing financial hardship due to rising prices. Of the 71 percent, 28 percent of low-income households say they have experienced “severe hardship” due to rising prices, and 42 percent say they have experienced “moderate hardship.”     

Since July, the Biden administration has been insisting this problem would go away. Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen described this inflation as "transitory." Clearly, those claims have not held up.  

2) $3.5 Trillion Tax Hike, The Largest Tax Increase Since 1968  

President Biden called for $3.5 trillion in tax increases in his 2022 budget proposal, the largest tax increase since 1968.  

In nominal dollars, Biden’s $3.5 trillion tax increase would have been the largest in history. But even when comparing this tax as a percentage of the economy, this tax hike would be the largest in more than 50 years. While Democrats claimed this tax increase would fall on “the rich," the proposal would have raised taxes on small businesses and working families at a time when they were most vulnerable. 

Biden’s proposal included the following harmful tax increases:  

  • Raising the Federal Corporate Income Tax to 28 Percent. After accounting for state corporate taxes, Biden would give the U.S. a 32 percent corporate rate, a tax rate significantly higher than communist China’s 25 percent tax rate. This tax increase would harm working families, as a significant portion of this tax, about 70 percent, is borne by workers in the form of lower wages and lost jobs. Additionally, the tax would be felt by consumers, as 31 percent of the corporate tax falls on consumers through higher prices.   
  • Retroactive Tax Increases on Capital Gains and Dividends. President Biden proposed doubling the capital gains tax rate. Under Biden, the average top capital gains rate will be 48.8 percent after state taxes. The retroactive nature of this proposed tax would cause anxiety and uncertainty, ultimately leading to substantial economic damage. This tax hike would result in severe double taxation, would reduce retirement savings, would suppress investment, and could even reduce federal tax revenue.   
  • Creating a Second Death Tax by Repealing Step-Up in Basis. Biden proposed the creation of a second Death Tax by repealing step-up in basis. This would impose the capital gains tax (which Biden has proposed raising to 43.4 percent) on the unrealized gains of every asset owned by a taxpayer when they die and will be imposed in addition to the existing 40 percent Death Tax.  This would create new complexity for many taxpayers, forcing predominantly family-owned businesses to downsize and liquidate assets, leading to fewer jobs, lower wages, and reduced GDP.   
  • Increasing the Top Income Tax Rate to 39.6 Percent. This tax increase would have hit small business that are organized as sole proprietorships, LLCs, partnerships, and S-corporations. These “pass-through” entities pay taxes through the individual side of the tax code. Of the 26 million businesses in 2014, 95 percent were pass-throughs. Pass-through businesses also account for 55.2 percent, or 65.7 million of all private sector workers. More than half of all pass-through income would have been taxed at this new, higher rate.   
  • Imposing a 15 Percent Minimum Tax on “Book Income.” This tax increase would create a new minimum tax on American businesses and disallow important, bipartisan credits and deductions that help promote job creation and economic growth.   
  • Imposing Global Tax Hikes That Will Make American Business Uncompetitive. Biden proposed modifying the Global Intangible Low-Taxed Income (GILTI) regime and imposing a global minimum tax on American businesses of up to 26.25 percent. This proposal was significantly higher than the 15 percent global minimum tax rate that Biden Treasury Secretary Janet Yellen is pushing to get adopted by the G-20 and the OECD. This would impose double taxation on American businesses and make it difficult for them to compete against foreign companies. 

 

3)  Proposed Doubling the Size of the IRS, Enabling IRS to Snoop on Americans’ Bank Accounts  

Biden proposed $80 billion in additional funding to the IRS, adding a whopping 87,000 new IRS agents – enough to fill Nationals Park twice. Biden’s proposal also included a provision enabling the IRS to track any bank account, credit union account, or third-party payment account (like Venmo, PayPal, and CashApp) exceeding gross inflows and outflows of $600.   

In the Democrats’ latest, house-passed version of the reconciliation bill, funding for audits, investigations, and other tax enforcement was 23 times greater than funding for taxpayer education and assistance. Out of nearly $80 billion in new IRS funding, $44.9 billion, more than half, would go directly towards enforcement. The agency would receive a comparatively meager $1.93 billion in funding for taxpayer services, which include things like pre-filing assistance and education, filing and account services, and taxpayer advocacy services.  

The bill would result in 1.2 million more annual IRS audits; about half will hit households making less than $75k. This is because, despite the Left’s claims that heightened enforcement would be directed solely towards “the rich,” the wealthy and large corporations already have armies of lawyers and accountants that ensure they are compliant with the tax code.  

Instead, the IRS will go after easier targets to find additional tax revenue: small businesses and low- and middle-income individuals.   

The agency has a long history of harassing taxpayers, discriminating against political adversaries, violating taxpayer privacy, and incompetence. 

The administration’s proposed reporting regime would be a radical violation of privacy, would unleash the IRS’s harassment on virtually every American, and would disproportionately hurt low- and middle-income Americans.

4) Assault on American Energy Development 

In the past year, President Biden president signed an executive order banning new drilling leases on federal lands, pursued more than $20 billion in new energy taxes on oil and natural gas production, and vetoed permitting for the Keystone XL pipeline here at home. At the same time, his administration lobbied Congress to oppose sanctions on the Russian Nord Stream 2 pipeline.

After one year of President Biden's failed presidency, Americans now face the highest gas prices since 2014, surging home-electricity prices, and increased reliance on oil from adversarial nations. 

President Biden’s decision to cancel the Keystone XL pipeline had several negative impacts on jobs, energy, and geopolitics. For starters, stopping the project killed about 11,000 jobs in 2021, including the thousands of construction jobs for rural and Indigenous communities the pipeline was on track to create. Additionally, canceling the pipeline ultimately damaged a more efficient, environmentally friendly way to transporting oil. In fact, Keystone XL had committed to the pipeline being fully powered by renewable energy.  Importantly, Biden's policy also cheated Americans out of cheaper, more accessible energy. If completed, the Keystone XL Pipeline would carry 830,000 barrels of oil from Canada through multiple states, where it would eventually reach Texas oil refineries, delivering savings to American families. Finally, killing the pipeline wasted billions of dollars in investments. TC Energy Corporation estimated an investment of more than $1.7 billion into communities, including $100 million in new property tax revenue and thousands of new middle-class jobs for both low and high-skilled workers.   

In addition to killing the pipeline, the Biden administration also attempted to issue a ban on new leases to drill for oil and gas on public lands – an effective fracking ban on federal lands. Thankfully, a federal judge blocked this order from going into effect. If it had, it would have empowered foreign adversaries, like Russia, dwindled Americans’ access to energy, and increased energy costs at a time when gasoline prices have already skyrocketed by 49.6 percent.     

The Democrats’ multi-trillion-dollar tax and spend bill, which Biden spent the year championing, included an $8 billion energy tax on methane from natural gas production and a $13 billion tax on crude oil, taxes that would be paid by American households in the form of higher energy bills.  

Under the Biden Administration, Russia is now supplying more oil to the U.S. than any other foreign producer besides Canada. The Biden Administration went as far as lobbying Congress to vote against sanctions on Russia's Nord Stream 2 pipeline, sanctions that were supported by 55 Senators including 6 Democrats. 

President Biden’s blows to the American energy sector hurts our energy independence and empowers foreign adversaries like Russia. These policies threaten Americans’ access to affordable energy, the U.S. economy, and national security.   

5) Pushed for Socialized Healthcare  

Biden’s proposal would have imposed drastic price controls on American medical innovation. Specifically, his proposal would have created a 95 percent excise tax on manufacturers who did not agree to socialist price controls. This means that a manufacturer selling a medicine for $100 would owe $95 in tax for every product sold with no allowance for the costs incurred. No deductions would be allowed, and it would be imposed on manufacturers in addition to federal and state income taxes they must pay.   

This proposal would have led to 167 to 324 fewer new drugs, according to an issue brief by Tomas J. Philipson and Troy Durie at the University of Chicago. These results are severe, but not surprising. After all, this proposal would arbitrarily set the price of medicines similar to the way other countries with socialized health systems have.  

Countries that utilize socialist price controls have lower access to care. For instance, Canadian patients wait an average of 19.8 weeks from referral to treatment. In the UK, at any one time, 4.5 million patients were waiting to see a doctor or receive care. By comparison, 77 percent of Americans are treated within four weeks of referral, while just 6 percent wait more than two months.   

Further, Americans have access to far more medicines than other countries. According to research by the Galen Institute, 290 new medical substances were launched worldwide between 2011 and 2018. The U.S. had access to 90 percent of these cures. By comparison, the United Kingdom had access to 60 percent of medicines, Japan had 50 percent, and Canada had just 44 percent.   

Additionally, this proposal would have threatened high-paying manufacturing jobs across the country at a time when we were just emerging from the economic wreckage from the pandemic. According to a 2017 study by TEConomy Partners, pharmaceutical manufacturers invest $100 billion in the U.S. economy every year, directly supporting 800,000 jobs including jobs in every state. These jobs are high-paying – the average compensation is $126,000 – more than double the average wage in the U.S. When accounting for indirect and induced jobs, medical innovation supports more than four million jobs.   

In trying to be more like foreign countries with socialist policies, Biden was willing to restrict Americans’ access to life-improving and life-saving medicines and threaten much-needed, high-paying American jobs. 

Photo Credit: Screen Capture, "Biden Remarks on Kabul," C-SPAN

More from Americans for Tax Reform


How the Tax Cuts and Jobs Act is Helping New Hampshire

Share on Facebook
Tweet this Story
Pin this Image

Posted by John Kartch on Thursday, January 20th, 2022, 11:00 AM PERMALINK

Below is a continuously updated compilation of good news arising from Tax Cuts and Jobs Act enacted by Republicans in 2017.

ACCORDING TO THE LATEST IRS DATA:

22.8% tax cut for New Hampshire households making between $25k - $50k. New Hampshire households with adjusted gross income between $25,000 and $50,000 saw their average federal income tax liability drop from $2,715.52 in 2017 to $2,212.17 in 2019, a 22.8% reduction in federal income tax liability. 

19.4% tax cut for New Hampshire households making between $50k - $75k. New Hampshire households with adjusted gross income between $50,000 and $75,000 saw their average federal income tax liability drop from $6,030.80 in 2017 to $5,050.35 in 2019, a 19.4% reduction in federal income tax liability. 

16.9% tax cut for New Hampshire households making between $75k - $100k. New Hampshire households with adjusted gross income between $75,000 and $100,000 saw their average federal income tax liability drop from $9,379.11 in 2017 to $8,023.81 in 2019, a 16.9% reduction in federal income tax liability. 

Just a 9.6% tax cut for New Hampshire households making over $1 million. Democrats claim the tax cuts were for “the rich” but as shown by the official IRS data, middle income New Hampshire households saw a significantly greater tax cut than those earning over $1 million. New Hampshire households earning over $1 million saw their federal income tax liability drop from $918,998.91 in 2017 to $838,869.96 in 2019, a reduction of just 9.6%. Data from the Congressional Budget Office also shows that high-earning Americans pay a greater share of taxes than before enactment of the Tax Cuts and Jobs Act. In other words, TCJA actually made the tax code more progressive, though you won’t hear Democrats admit it. 

The TCJA also contained numerous reforms that benefited New Hampshire households: 

NH households are no longer stuck paying the Obamacare mandate tax. The TCJA zeroed out the Obamacare individual mandate tax penalty effective 2019. In 2017, 23,630 New Hampshire households paid the Obamacare individual mandate tax penalty. 21,090 (89%) of taxpayers earned less than $75,000. 19,640 households paid the Obamacare individual mandate tax penalty in 2018. 17,080 (87%) of taxpayers earned less than $75,000. 

Doubled Standard Deduction. The TCJA doubled the standard deduction from $12,000 to $24,000 for taxpayers filing jointly and $6,000 to $12,000 for single filers. 633,700 NH households took the standard deduction in 2018 including 606,110 households earning less than $200,000. 646,320 taxpayers took the standard deduction in 2019 including 615,850 taxpayers earning less than $200,000. 

20% tax deduction for NH small businesses. The TCJA created a new, 20% deduction for small businesses organized as pass-through entities (LLCs, sole proprietors, S-corporations, partnerships). 112,650 NH taxpayers claimed the small business deduction in 2019 including 89,610 taxpayers earning less than $200,000. 90,390 taxpayers claimed the small business deduction in 2018 including 73,270 taxpayers earning less than $200,000. 

Doubled Child Tax Credit. The TCJA doubled the child tax credit from $1,000 to $2,000. 157,940 NH households took the child tax credit in 2019 including 140,320 households earning less than $200,000. 157,700 households took the child tax credit in 2018 including 141,130 households earning less than $200,000.

Additional NH examples of TCJA good news:

Portsmouth Brewery (Portsmouth, New Hampshire)  – The founder of the brewery said that the tax cut allowed the company to hire more employees and invest in new equipment:

"For a small brewery like us, we make about 1,000 barrels a year,” said Peter Egelston, founder of Portsmouth Brewery. “So saving $3.50 per barrel, you can do the math, that's about $3,500 in savings. That may not sound like a lot of money, but it is."

The tax cut was set to expire at the end of 2019, but with support from Congress, Trump signed a one-year extension. 

"That's money going back into small businesses, and it's being used to invest in equipment,” said Egelston. “It's being used to hire more people. It's being used in a lot of different ways. That’s a choice each individual business can make. When they get a windfall like a reduced tax rate, they can either keep that money in the business or they can pass it along to the consumer in the form of lower prices."  – Jan. 1, 2020, WMUR article.

Connection (Merrimack, New Hampshire) -- $1,000 bonuses:

Connection (PC Connection, Inc.; NASDAQ: CNXN), a leading technology solutions provider to business, government, and education markets, today announced that it will pay a $1,000 cash bonus to each employee in consideration of their efforts for the year ended December 31, 2017.

"We are pleased to be able to provide this special reward to our valued employees for their hard work and commitment to excellence," said Timothy McGrath, CEO and President.

The Company is still evaluating all the provisions of the Tax Cuts and Jobs Act enacted on December 22, 2017, which effected numerous changes in existing tax law, including a permanent reduction in the federal corporate income tax rate. The rate reduction takes effect on January 1, 2018, and the Company currently anticipates that the net impact on its tax provision and cash taxes paid will be beneficial. -- Feb. 7, 2018 Connection press release

Franklin Savings Bank -- branch locations in Concord, Bristol, Franklin, Gilford, Merrimack, and Tilton – $1,000 bonuses:

Franklin Savings Bank announced today that it will use a portion of its tax savings to provide employees with a special bonus in recognition of their contribution to the continued success of the bank. FSB will benefit from the reduction in corporate tax rates, and has chosen to share the savings with its employees. All employees will receive a $1,000 bonus.

“Our employees consistently go ‘above and beyond’ for our customers and the communities we serve,” said Ron Magoon, President & CEO. “This bonus is another opportunity to thank them for their outstanding commitment, dedication and service.” – Feb. 26 2018, Franklin Savings Bank press release excerpt

Waste Management Inc.  (Multiple locations in New Hampshire) -- $2,000 bonuses:

In light of the meaningful contributions of its employees and the new U.S. corporate tax structure, the company will distribute US $2,000 in 2018 to every North American employee not on a bonus or sales incentive plan; that includes hourly and other employees.

“We are about to get a tax benefit as our U.S. corporate tax rate goes from 35 percent to 21 percent. In considering how to best spend that, we wanted to find a way to help grow our economy, which in turn, will help grow our business, and give some of the tax savings back to those hardworking employees who do not get the opportunity to participate in our salaried incentive plans,” said Jim Fish, president and chief executive officer, Waste Management.

“So, we are offering each North American hourly full-time employee and salaried employee who does not participate in any sales incentive or bonus plan during 2018, a cash bonus of US $2,000 to show our appreciation to so many of our valued employees while growing our business and returning a good portion of the tax savings directly to the overall economy,” he continued. – Jan. 10 2018, Waste Management Inc. press release excerpt

Pentucket Bank -- branch locations in Hampstead and Salem -- $500 bonuses, increased wages, and increased educational opportunties.

Granite State Electric (Liberty Utilities) (Salem, New Hampshire) – The utility will pass along tax cuts savings to customers:

In this order, the Commission approves a distribution revenue decrease for Liberty Utilities, passing on to ratepayers the benefits of reduced corporate taxes resulting from recent changes to state and federal tax laws. This order also approves Liberty’s proposal to forego other distribution rate increases that were scheduled to take effect June 1, 2018, as a way to pass additional benefits of corporate tax reductions on to customers. – New Hampshire Public Utilities Commission Order excerpt

Apple (Apple store locations in Manchester, Nashua, Salem)  - $2,500 employee bonuses in the form of restricted stock units; Nationwide, $30 billion in additional capital expenditures over five years; 20,000 new employees will be hired; increased support of coding education and science, technology, engineering, arts, and math; increased support for U.S. manufacturing. 

AT&T -- $1,000 bonuses to 171 New Hampshire employeesNationwide, $1 billion increase in capital expenditures:

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

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

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

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

T.J. Maxx16 stores in New Hampshire – tax reform bonuses, retirement plan contributions, parental leave, enhanced vacation benefits, and charitable donations:

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

Associates

  • A one-time, discretionary bonus to eligible, non-bonus-plan Associates, globally

  • An incremental contribution to the Company’s defined contribution retirement plans for eligible Associates in the U.S. and internationally

  • Instituting paid parental leave for eligible Associates in the U.S.

  • Enhancing vacation benefits for certain U.S. Associates

Communities

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

Best Buy -- Nine store locations in New Hampshire -- $1,000 bonuses for full-time employees; $500 bonuses for part-time employees. Over 100,000 employees will receive bonuses:

Best Buy is the latest major corporation to hand out bonuses to its employees as a result of the recently passed corporate tax reform.

In a letter sent to employees Friday afternoon, CEO Hubert Joly said full-time employees will receive a one-time bonus of $1,000 and part-time employees $500.

All permanent employees who are not on an existing bonus plan will receive the additional funds. The bonuses are expected to show up in their paychecks this month.

In all, more than 100,000 of Best Buy’s 125,000 employees in the U.S., Mexico and Canada are slated to receive the extra payouts.

In addition, Best Buy is making a one-time contribution of $20 million to the Best Buy Foundation to help further expand its teen tech centers and Geek Squad Academies across the U.S.

“Our goal was simple: to say ‘thank you’ to more than 100,000 of our employees and help accelerate our work to bring much needed technology training to 1 million underserved teens a year,” said Jeff Shelman, a Best Buy spokesman.Feb. 2 2018, Minneapolis Star Tribune

Cintas (Chelmsford, New Hampshire) -- $1,000 bonuses for employees of at least a year, $500 for employees of less than a year.

Home Depot -- 20 locations in New Hampshire, bonuses for all hourly employees, up to $1,000.

Lowe's --1,000 employees at 13 stores in New Hampshire; Employees will receive bonuses of up to $1,000 based on length of service, for 260,000 employees; expanded benefits and maternity/parental leave; $5,000 of adoption assistance.

Ryder (Three locations in New Hampshire) – Tax reform bonuses.

CarMax (Location in Manchester, New Hampshire) – $250-$1,500 bonuses depending on length of service:

“The nation’s largest retailer of used cars, announced plans to provide one-time bonuses to most hourly and commissioned full-time and part-time associates as a result of the recently passed Tax Cuts and Jobs Act of 2017. Bonus amounts will vary from $200 up to $1,500 based on length of service with the company.” – Feb 23. 2018, EPR Retail News article excerpt

Walmart - New Hampshire employees at 27 Walmart stores received tax reform bonuses, wage increases, and expanded maternity and parental leave. Walmart employees who adopt children will be given $5,000 to help cover expenses.

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

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

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

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

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

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

Comcast (Multiple locations in New Hampshire) -- $1,000 bonuses; nationwide, at least $50 billion investment in infrastructure in next five years.

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

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

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

 

More from Americans for Tax Reform


ATR Releases Letter to Senate Judiciary on Klobuchar Antitrust Bill

Share on Facebook
Tweet this Story
Pin this Image

Posted by Tom Hebert on Wednesday, January 19th, 2022, 3:00 PM PERMALINK

On Thursday, the Senate Judiciary Committee will markup S. 2992, the "American Innovation and Choice Online Act," legislation sponsored by Sen. Amy Klobuchar (D-Minn.) that upends decades of antitrust precedent and gives unelected bureaucrats new authority to pick winners and losers. 

ATR President Grover Norquist released a letter to the Senate Judiciary Committee outlining several concerns with the bill, pointing out that it will increase the burden of inflation on American families and do nothing to stop conservatives from being censored by Big Tech. 

Click here or below to read the letter in full: 

Dear Members of the Senate Judiciary Committee: 

I write to express concerns with S. 2992, the “American Innovation and Choice Online Act,” legislation sponsored by Sen. Amy Klobuchar (D-Minn.) that upends decades of antitrust precedent and gives unelected bureaucrats new power to pick economic winners and losers. If implemented, S.2992 will raise prices on families already struggling with inflation and break services Americans use every day. 

The original bill targeted companies with a market capitalization over $550 billion and 50 million monthly users. Sen. Klobuchar’s manager’s amendment broadens the criteria for a “covered platform” even further to include privately held companies with annual revenue of more than $30 billion, ensnaring companies in the grocery, agriculture, and professional services sectors.

Using market capitalization or annual revenue to dictate how a company should operate is a radical departure from how U.S. law is typically written. In a search of all current federal statutes, the phrase “market capitalization” comes up in only five, none of which is about determining how a business is run based on this paper valuation. 

S. 2992 shifts antitrust law away from the long-held consumer welfare standard, which protects consumers from harm, toward a European-style approach that protects individual competitors in a given market. This legislation bans companies over a government-determined size from selling or providing private-label products on their own platforms, a practice beneficial to consumers but negatively branded as “self-preferencing.” 

While antitrust crusaders may paint self-preferencing in a bad light, it is not a business practice endemic to the companies this legislation targets. Brick-and-mortar retailers often promote their own generic products next to brand-name goods via preferable shelf space or promotional devices like coupons, end-caps, and window displays. This common business practice benefits shoppers through lower prices and more choices. 

Banning self-preferencing would take away choice and access to generic products for American consumers, the vast majority of which are at a lower price point than name-brand goods. Families are already struggling with 7 percent inflation thanks to the reckless tax-and-spend policies of the Biden Administration. The last thing they need is reduced access to generic goods they are reaching for just to make ends meet. 

This legislation would also interfere with goods and services Americans use every day, a classic case of needless government intervention in the private sector. Amazon would no longer be able to sell AmazonBasics products or provide free two-day Prime shipping. Google would no longer be able to display YouTube links, restaurant reviews, or Maps directions when searched. Apple could no longer preinstall apps on their devices, making your new iPhone virtually useless out of the box. 

Conservatives should be wary of giving the Biden Administration any new antitrust authority, as this legislation does. If a company has been found to violate S.2992, it may be subject to a penalty of up to 15 percent of total revenues for a year. Depending on profit margins, this fine could easily be more than double the profit a given company makes in a year.

The left has not been shy about their plan to use antitrust law to push a progressive social agenda, and Sen. Klobuchar’s manager’s amendment shows that this legislation goes far beyond Big Tech. Sen. Klobuchar has repeatedly said that she wants to go after every industry “from cat food to caskets.” 

Ultimately, this bill does nothing to stop conservative censorship, will increase inflation concerns for American families, and gives the Biden Administration sweeping new power to reshape the economy in service of a progressive social agenda.

Onward, 

Grover G. Norquist
President, Americans for Tax Reform

Photo Credit: Gage Skidmore


ATR Op-Ed in American Banker: “Regulators must provide relief during transition from Libor”

Share on Facebook
Tweet this Story
Pin this Image

Posted by Americans for Tax Reform on Wednesday, January 19th, 2022, 1:53 PM PERMALINK

In an op-ed published in American Banker today, ATR Federal Affairs Manager Bryan Bashur highlights the importance of providing regulatory relief and flexibility for financial institutions as they transition away from using the London Interbank Offered Rate (LIBOR) as a gauge for how much interest to charge on certain financial products. Trillions of dollars in contracts for mortgages, credit cards, bonds, student loans, futures, swaps, and options, will all feel the effects of this transition. As Bashur explains:

It is imperative that the United States government implement regulatory relief, emphasize flexibility and develop concrete guidelines for financial institutions so they can easily adapt to the changing interest rate landscape. As banks and other financial institutions rewrite contracts for mortgages, credit cards, bonds, student loans and financial derivatives to adjust to fluctuating interest rates, the federal government needs to ensure that the tax burden is limited and litigation is mitigated.

According to the Congressional Research Service, as of the end of 2020 Libor was referenced in over $220 trillion financial instruments denominated in U.S. dollars, including mortgages, student loans, bonds, derivatives and more. PwC estimates that Libor is tied to as much as $350 trillion “in bonds, loans, derivatives and securitizations worldwide.” The aggregate gross domestic product for all the economies in the world pales in comparison ($84.68 trillion in 2020) to the amount of financial products connected to Libor.

As LIBOR is phased out and new benchmark interest rates will be widely adopted, it is imperative that banks and other financial institutions are able to use reference rates that best suit their products and the customers they serve. As Bashur points out:

However, regulators should emphasize flexibility and allow financial institutions to use benchmark rates that best suit their customers. Benchmarks such as the American interbank offered rate (Ameribor) and the Bloomberg Short Term Bank Yield Index (BSBY) are credit-sensitive and “provide a more accurate reflection of lenders’ funding costs.”

Enabling lenders to choose among a host of different rates will lead to more innovative financial products and could increase capital disbursement to borrowers.

Some long-term financial contracts that use LIBOR do not include plans for how to adjust the terms when LIBOR is fully discontinued. However, Congress is working on legislation to provide a more concrete framework to ease the transition. Bashur states that:

Federal regulators also need to ensure that bonds or other contracts that extend beyond 2021 and do not include contingency plans for the Libor transition are able to avoid costly litigation, which would harm both lenders and borrowers.

Fortunately, Congress is working on a bill to provide a federal framework to allow these longer-term contracts to easily transition to new reference rates. Rep. Brad Sherman, D-Calif., introduced HR 4616, the Adjustable Interest Rate (Libor) Act of 2021, to provide a framework to ease financial institutions away from Libor for contracts that lack explicit language explaining how borrowers and lenders can transition their contract from Libor to a new reference rate. The federal framework would preempt any cumbersome patchwork of state laws that could inhibit a streamlined transition for financial contracts that cross state lines.

HR 4616 garnered strong bipartisan support and passed the House by a vote of 415-9. It is highly likely that the Senate will introduce a bipartisan bill identical or nearly identical to Rep. Sherman’s bill and pass it with little consternation.

One example of regulatory relief during the LIBOR transition is a rulemaking the IRS published that exempts financial contracts from capital gains tax if the terms of the contract are amended to reflect the change in benchmark interest rates. Bashur elaborates that:

The IRS concludes in the draft rule that the exemption from capital gains tax applies “to both the issuer and holder of a debt instrument and to each party to a nondebt contract.”

Accordingly, the final rulemaking would preserve the tax exemption and avoid the negative implications of imposing the burdensome capital gains tax on borrowers and lenders during the Libor transition. Application of a capital gains tax to mortgages and student loans in this scenario is unnecessary and erroneous.

Bashur urges Congress and federal regulators to continue the stream of regulatory relief “so that both lenders and borrowers can avoid costly litigation, burdensome taxation and illiquidity.”

Click here to read the full op-ed.

Photo Credit: "interest rate" by Mike Cohen is licensed under CC BY 2.0

More from Americans for Tax Reform

There are no related posts.


Further Hearings on Sohn’s FCC Nomination Are Required

Share on Facebook
Tweet this Story
Pin this Image

Posted by Katie McAuliffe on Wednesday, January 19th, 2022, 9:13 AM PERMALINK

Senator Roger Wicker is correct to call for further hearings on Gigi Sohn’s nomination to the Federal Communications Commission. There is still more information that needs to be discussed, such as the details of the Locast settlement and the conditions of recusal in FCC matters. 

Sohn spearheaded an FCC proceeding that would have enabled tech platforms to effectively steal and monetize television content without paying for usage rights. Just as a-la-cart television didn’t need direction from lawmakers. The set-top box regulations were clearly trounced by the market, as a myriad of streaming options for viewing content are currently available. However, this is just one instance where Sohn engaged in attempts to weaken intellectual property rights.  

Perhaps even more egregious, Sohn served on the board of Locast, a “non-profit” that was determined to be illegally retransmitting broadcasters’ content without their consent in violation of the Copyright Act. The case resulted in a permanent injunction that required Locast to pay $32 million in statutory damages. Sohn cannot be an impartial regulator of the broadcast industry after joining the Board of an organization that openly violated that industry’s copyrights.  

It is also interesting to note that her nomination was received in the Senate from the President that on the same day that the Locast settlement was announced, October 28, 2021. 

It has been reported that she is negotiating a recusal deal, but none of these details have been made public or shared with other senators on the committee. Further, we simply have to take Sohn’s word that she will recuse herself. These agreements have no force of law. It’s very problematic that someone who signed a $32 million settlement agreement with broadcasters now wants to regulate them. 

Further a recusal from ruling on broadcast licenses, retransmission or copyright relating to the parent companies of ABC, CBS, NBC and Fox, who filed suit against Locast, would severely limit her ability to do any of the primary work of the Commission. 

Americans for Tax Reform joined a coalition letter opposing her nomination over legitimate concerns regarding her ability to be impartial, which include hyper-partisan attacks on Republicans, interest in revoking broadcast licenses over viewpoints, doomsday predictions for the internet without Title II regulations. 

Photo Credit: "Gigi Sohn" by Joel Sage is licensed under CC BY-SA 2.0

More from Americans for Tax Reform


Indiana Bill Would Raise the Cost of Nonalcoholic Beverages

Share on Facebook
Tweet this Story
Pin this Image

Posted on Tuesday, January 18th, 2022, 4:45 PM PERMALINK

The Indiana House Committee on Commerce, Small Business and Economic Development will be considering legislation that would impose a first in the nation price control on nonalcoholic beverages. House Bill 1109, if implemented, would prevent distributers of packaged nonalcoholic beverages with a weight volume of 8 ounces or more from offering seasonal promotions and other discounts to Indiana retailers unless they are extended to every store in the state. 

Despite the good intentions behind this bill, it would inflict a great deal of harm on the state economy. “Allowing the government to meddle into negotiations between private businesses in order to impose price controls would actually result in fewer discounts being available, driving prices up and leaving families across Indiana to face higher costs at a time when they can least afford it,” warned Grover Norquist, president of Americans for Tax Reform, in a letter to committee members. “Many of these households along state lines could decide to instead visit stores in Illinois, Kentucky, Michigan, or Ohio, hurting Indiana’s small businesses and their employees.”

To read the full letter, click here.

 

__

 

January 18, 2022

 

To: Members of the Indiana House Committee on Commerce, Small Business and Economic Development

From: Americans for Tax Reform

 

Re: Oppose House Bill 1109

 

Dear Representative,

 

On behalf of Americans for Tax Reform (ATR) and our supporters across Indiana, I urge you to oppose House Bill 1109, legislation that would jeopardize the right to private contract in order to impose price controls on certain nonalcoholic beverages. If implemented, this bill would inflict a great deal of harm on small businesses and consumers across the Hoosier State.

Under the status quo, all Indiana retailers, from small convenience stores to large chain grocery stores, can negotiate their preferred contract terms with the nonalcoholic beverage industry. This flexibility allows retailers to benefit from seasonal promotions and other price discounts that can be passed onto consumers, ultimately making their stores more competitive than those in surrounding states.

This free-market approach is not unique to Indiana, but is the standard practice used by all retailers and the nonalcoholic beverage industry nationwide. Unfortunately, HB 1109 seeks to disadvantage Indiana retailers by making it illegal for distributers of packaged nonalcoholic beverages with a weight volume of 8 ounces or more to offer special pricing deals in Indiana unless they are extended to every store in the state.

Despite the good intentions behind this bill, it would actually result in a number of negative consequences for the local economy. Allowing the government to meddle into negotiations between private businesses in order to impose price controls would actually result in fewer discounts being available, driving prices up and leaving families across Indiana to face higher costs at a time when they can least afford it. Many of these households along state lines could decide to instead visit stores in Illinois, Kentucky, Michigan, or Ohio, hurting Indiana’s small businesses and their employees.

Adding insult to injury, HB 1109 would also drive new investment, jobs, and opportunities away from Indiana. Why would a CEO in any industry want to do business in a state that is known for undermining the right to private contract and has the unwelcome distinction of being the only state in the country to impose price controls on nonalcoholic beverages? There are plenty of other states with lower tax rates that are much less hostile to businesses.

ATR opposes HB 1109 and urges lawmakers to vote NO.

 

Sincerely,

 

Grover Norquist

President

Americans for Tax Reform

Photo Credit: "Capitol del Estado de Indiana, Indianápolis, Estados Unidos" by Diego Delso licensed under CC BY-SA 3.0


Top Tier GOP Candidates Budd and McCrory Sign the Taxpayer Protection Pledge in N.C. Senate Race

Share on Facebook
Tweet this Story
Pin this Image

Posted by Adam L. Radman, Patrick Gleason on Tuesday, January 18th, 2022, 2:14 PM PERMALINK

Americans for Tax Reform (ATR) commends Rep. Ted Budd and Gov. Pat McCrory for signing the Taxpayer Protection Pledge in their race for North Carolina’s U.S. Senate seat. The Pledge is a written commitment to North Carolina taxpayers that they will oppose and vote against all income tax hikes. 

Candidates running for public office like to say they will not raise taxes, but often turn their backs on the taxpayer once elected. The idea of the Taxpayer Protection Pledge is simple enough: Make them put their no-new-taxes rhetoric in writing, so the promise is much harder to break. 

“North Carolina voters are looking for solutions that get Americans back to work and grow the economy. I commend Budd and McCrory for signing the Taxpayer Protection Pledge and promising to hold the line on taxes,” said Grover Norquist, President of Americans for Tax Reform. “It’s the first step in jump-starting the economy.” 

There are currently 179 Pledge signers in the U.S. House and 44 Pledge signers in the U.S. Senate. 85% percent of all congressional Republicans have made the written commitment to oppose higher taxes. In contrast, ZERO congressional Democrats have made that promise.

“During his time as governor, Pat McCrory signed the Taxpayer Protection Pledge and kept his commitment to North Carolinians. Not only that, but Gov. McCrory also enacted a multi-billion-dollar income tax cut that remains a national model for pro-growth tax reform,” Norquist said. “Congressman Budd, meanwhile, has maintained the Taxpayer Protection Pledge that he signed as a member of the U.S. House. In addition to keeping that commitment, he voted for the Tax, Cuts, and Jobs Act, the federal tax reform enacted in 2017 that provided a net tax cut to the vast majority of American households.”  

In President Biden’s first year, he championed a multi-trillion tax and spend bill, which includes the largest tax increase since 1968. These tax hikes would disproportionately hurt workers, retirees, consumers, and small businesses. Taxpayers should expect more of the same for the remainder of his presidency. 

“Voters have a right to know where candidates stand on taxes before heading to the voting booth,” added Norquist. “The Taxpayer Protection Pledge is a simple litmus test that tells voters I’ll work to protect your wallet. I encourage all candidates for elected office to make this commitment today.”  

New candidates sign the Taxpayer Protection Pledge regularly. For the most up-to-date information on this race or any other, please visit the ATR Pledge Database. 

More from Americans for Tax Reform


×