Partisan FTC and DOJ Misconstrue Debit Card Landscape

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Posted by Bryan Bashur on Thursday, October 21st, 2021, 2:57 PM PERMALINK

Partisanship and left-wing extremism epitomize the Biden administration. This has made it exceedingly difficult for the administration to finalize a deal with moderate Democrats on the multi trillion-dollar tax-and-spend package. What is important to note though is that this partisanship extends beyond the doors of the White House and is present at every agency throughout the federal government.

In particular, the Department of Justice (DOJ) and Federal Trade Commission (FTC) are led by liberals Merrick Garland and Lina Khan, respectively. Recently DOJ and FTC filed letters in support of the Federal Reserve’s notice of proposed rulemaking, which would amend provisions of Regulation II so that certain debit card routing restrictions would apply to transactions that occur online (i.e. card-not-present transactions).   

The fact that these agencies publicly support the Federal Reserve’s rulemaking to further bolster the routing restrictions from the Durbin amendment, which is widely lauded by Democrats, is par for the course.

If officials at DOJ and FTC were nominated by a conservative Republican administration, it is unlikely they would support policy that is clearly an expansion of a federal government mandate.

Moreover, the language on routing restrictions in the Durbin amendment has been misconstrued by the Federal Reserve. The language in statute requires the Federal Reserve to issue rules that prohibit restricting “the number of payment card networks on which an electronic debit transaction may be processed.” However, statute does not authorize the Federal Reserve to write rules “to impose an affirmative obligation” on banks and credit unions to make sure that each merchant and transaction is provided with at least two unaffiliated payment networks. Clearly, the Federal Reserve is overstepping its statutory authority in its proposed rulemaking.

The DOJ and FTC’s claims that banks, credit unions, and payment card networks are actively conducting anticompetitive behavior to the detriment of merchants is false. In many cases merchants are the ones limiting routing options. Banks and credit unions cannot help it if merchants refuse to use updated and more secure technology to access payment networks.

In 2011, the Federal Reserve admitted that banks and credit unions could not be at fault if a merchant decided to not install new card processing technology, such as card reader terminals. The Federal Reserve stated that, “To the extent a merchant has chosen not to accept PIN debit, the merchant, and not the issuer or the payment card network, has restricted the available choices for routing an electronic debit transaction.”

This issue continues today. Merchants have limited payment options for consumers to cut corners while the technology for alternative payment methods for card-not-present transactions has existed for years.

Merchants “have been making a conscious decision not to adopt technologies” that would broaden payment transaction choices for card-not-present transactions.

Biden’s DOJ and FTC have it all wrong. It is not the banks, credit unions, or payment card networks that reduce competition, it is the large multi-billion-dollar merchants that prefer to cut corners than prioritize secure and efficient debit transactions.

Photo Credit: "Woman holding credit card closeup" by Nenad Stojkovic is licensed under CC BY 2.0

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Tax Policy Center: Biden's IRS Bank Account Snooping Plan "Will Fail"

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Posted by John Kartch on Thursday, October 21st, 2021, 12:48 PM PERMALINK

America's top progressive tax group says Dem plan will "bury the agency in a sea of unproductive information" and "won't help" and "will fail"

Not only are Americans creeped out by President Biden's plan to have the IRS snoop on their bank accounts, the nation's most prominent progressive tax policy group says the plan won't even work.

The Tax Policy Center says the plan is "poorly conceived," and will "bury the agency in a sea of unproductive information" and "won't help" and "will fail."

On Oct. 19 Tax Policy Center senior fellow Steve Rosenthal wrote on Twitter

"Biden's Treasury doubles-down on a poorly-conceived reporting proposal, casting its net far too wide, which may catch small businesses, but not the big fish (who cheat by stretching the tax law, not by hiding their cash flow). I tried to help at the start, but I gave up."

On Oct. 20 Rosenthal wrote on Twitter

"If Congress wants to collect more money from the rich, it must pass better tax rules, which measure and time income accurately and do not create ambiguities that aggressive taxpayers and their highly-paid advisers can exploit. Bank reports on aggregate cash flows won't help."

On Oct. 16 Rosenthal was quoted in The Hill

Steve Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center, whose former director now works in the Biden administration, said the proposal is too expansive and thinks bank lobbyists “have touched a raw nerve” with their customers who are concerned about privacy.

“I think at the end of the day, this bank proposal will fail,” he said.

On May 3, Rosenthal wrote:

"In practice, the IRS’ task would be daunting and, in fact, bury the agency in a sea of unproductive information.

Biden’s plan is expansive: deposits and withdrawals must be reported for every account, individual or business, at every financial institution. Then, to construct taxpayer-specific information, the IRS must collate taxpayer-account information across many different financial institutions. That is because taxpayers often hold multiple accounts. Yet, whether collated or not, deposits and withdrawals are not income, unlike wages or interest. And deposits and withdrawals cannot be netted to calculate income, without substantial adjustments."

On Oct. 18 Rosenthal was quoted in The Washington Post:

"It’s still a deeply flawed proposal,” Rosenthal said. “Even at $10,000, the Biden bank proposal is still too sweeping, throws a net very wide, and it’s hard to see what fish they want to catch here.”

Biden wants to increase IRS funding by $80 billion to double the size of the IRS and hire 87,000 new auditors and agents. This quantity of agents is so large that it could fill every seat in Washington DC's Nationals Park, twice. It could fill the ancient Colosseum 1.74 times. 87,000 new IRS agents is more than the entire personnel on all 11 U.S. aircraft carriers.

Even Obama-era IRS chief John Koskinen – a longtime advocate of increasing the IRS budget – thinks Biden’s proposal is too much.

As reported by the New York Times:  

“I’m not sure you’d be able to efficiently use that much money,” Mr. Koskinen said in an interview. “That’s a lot of money.”  

Rather than fix the agency's longstanding mismanagement, ineptitude and abuse problems, Biden's approach will make the problem worse.

Americans have a firm, categorical objection to the IRS snooping in their bank accounts.

Here are some quotations from a local news compilation released by Americans for Tax Reform this week:

“I don’t see what business it is of anyone’s what I spend out of my bank account."

“No, it’s not their business. I already tell them enough.” 

 “I don’t feel that’s appropriate, that the IRS should be looking into people’s bank accounts.”

“They’re trying to get in to see every little thing you’re doing.”

“It could be a little invasive.” 

“It’s kind of over the top and I just think that it’s an invasion of privacy.”

“Our bank accounts, you’d think would be somewhat private if you’re just a regular Joe Schmo making money week-to-week.”

“I do not think the government should be intervening in individual bank accounts.”

“It is personal information, that’s why we file taxes, too. You know, they should not have access to all that stuff.”

“I don’t think it’s right, it’s not their business what’s in my bank account.” 

Click here or below to view:

Photo Credit: Gage Skidmore licensed under CC BY-SA 2.0


ATRF Announces Release of the 2021 International Trade Barrier Index

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Posted by Philip Thompson, Rowan Saydlowski on Thursday, October 21st, 2021, 7:00 AM PERMALINK

The Americans for Tax Reform Foundation today released the 2021 International Trade Barrier Index. Singapore, New Zealand, and the Netherlands scored the top spots for trade liberalization. While India, Algeria, and China ranked the worst for deploying the most protectionist trade barriers. Due to Brexit, the UK is the most improved moving from 8th to 4th as it implements its own tariff schedule reducing trade barriers between it and the rest of the world. 

Trade barriers on the rise 

The TBI measures the direct and indirect trade barriers imposed by 90 countries affecting 84% of the world’s people and 95% of world GDP. The 2021 edition records a global .5% increase in the use of trade barriers from the first edition in 2019. 

Western Europe, as a region, leads the world in open trade. Yet the region was held back by a large number of new digital trade barriers that impose cross-border data restrictions, content moderation, and limit the scope of intermediary liability.  Only India, Indonesia, and China impose more digital trade restrictions than the European Union.  

Barrier-free trade is associated with beneficial social and economic outcomes. The Index finds countries with lower trade barriers experience more prosperity, economic freedom, and human development; while countries with higher trade barriers perceive greater rates of corruption, abuse of the press, and illicit trade. 

The United States largely maintained its restrictive trade profile, improving slightly from 54th to 51st mainly due to nominal reductions in non-tariff measures as a response to COVID-19. Yet the U.S. position as a global rule maker may be in jeopardy as the UK, China, the European Union, and each the 90 countries in the TBI on average signed at least one additional trade agreement granting comprehensive market access and cementing new rules. China also improved its score by reducing its average applied MFN tariff rate. 

India increased use of trade barriers to maintain the last spot on the Index. Not only did India increase its MFN average applied tariff rate; at the start of the COVID pandemic India had one of the world’s highest tariff rates on medicines and medical equipment and during the pandemic India added the most restrictive non-tariff barriers on medical equipment and vaccines.  

Only six countries with a combined population of 142 million people enjoy the highest level of barrier-free trade, with a TBI score below 3.0 Meanwhile, 13 countries remain in the “highly protected” range with TBI scores above 5.0, where 3.8 billion people have severely limited access to barrier-free trade.  

Philip Thompson, author of the Index remarked “it is people who trade, and when barriers are in the way it’s harder to source material, respond to consumer preferences, and create win-win exchanges to recover from a pandemic.”  

The Index includes eight case studies from leading free-market think tanks around the world that examine harms trade barriers impose from the availability of affordable housing in Sri Lanka to diversion of legitimate market activity to criminal syndicates in the illicit market.  

  • Mercosur and the Automobile Industry: Trade Diversion and Protectionism in the Southern Cone; By Pedro Raffy Vartanian & Vladimir Fernandes Maciel, the Mackenzie Center for Economic Freedom, Brazil 
  • South Africa’s Next Steps for Trade Liberalization, By Christopher Hattingh, Free Market Foundation, South Africa 
  • Benefits of Bilateral and Multilateral Free Trade Agreements; By Natalia Gonzalez & Tomas Flores, Libertad y Desarrollo, Chile 
  • The Effects of Pre-Shipment Inspections (PSI) on Food Trade in Indonesia; By Kukuh Sembodho & Arumdriya Murwani, Center for Indonesian Policy Studies, Indonesia 
  • Protectionist Tariffs Compromising Sri Lanka’s Middle-Income Earners’ Right to Shelter; By Sathya Karunarathne & Aneetha Warusavitarana, Advocata, Sri Lanka 
  • The Illicit Trade of COVID-19 Items: Poor Trade Enforcement as a Barrier to Access; By Giorgina Agostini, Rowan Saydlowski, & Philip Thompson, Property Rights Alliance, U.S.A 
  • The Proliferation of Digital Trade Barriers Threatens Innovation, Free Trade; Competition, and Free Speech; By Philip Thompson & Andreas Hellmann, Americans for Tax Reform, USA 
  • Lessons in High Tobacco Taxes and Smuggling in the Philippines; By Bienvenido S. Oplas, Jr., President, Minimal Government Thinkers, Philippines 

 

The executive summary of the International Trade Barrier Index can be found [here] and the interactive website is [here]


CBO: Dem Healthcare Policies Will Kick Millions of their Healthcare Plans, Increase Deficit

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Posted by Isabelle Morales on Wednesday, October 20th, 2021, 3:35 PM PERMALINK

The health care policies being pushed by House Democrats in the reckless, multi-trillion dollar tax and spend reconciliation bill will kick 2.8 million Americans off of their current health plans and force them into government run healthcare, according to a recent letter from the Congressional Budget Office (CBO).  These policies will also increase deficits by a whopping $553 billion at a time that the debt remains out of control.

Democrats are attempting to expand premium tax credits and cost-sharing reductions available for health insurance under Obamacare. Additionally, they would include the creation of a federal Medicaid program for states that have not expanded Medicaid under Obamacare. These provisions would cost $553 billion, nearly $14,200 per person, per year. This is twice the cost of the average employer-sponsored plan.  

House Budget Committee Republican Leader Jason Smith (R-Mo.), House Energy and Commerce Committee Republican Leader Cathy McMorris Rodgers (R-Wash.), House Ways and Means Committee Republican Leader Kevin Brady (R-Texas), and House Education and Labor Committee Republican Leader Virginia Foxx (R-N.C.) sent a letter to the CBO on October 5th requesting that the office reveal the cost and coverage impact of the health care provisions included in the reconciliation bill draft. 

The CBO found that Democrats’ plan would result in at least 2.8 million Americans losing their employer-sponsored health plans and, instead, being pushed onto government health insurance.  

The Ways and Means Committee Republicans released a statement detailing several of the CBO’s other findings:  

  • “The permanent expansion of Obamacare’s advanced premium tax credit (PTC) subsidies will cost American taxpayer’s roughly $210 billion over 10 years and cement approximately 3.4 million Americans into a government program – this includes 1.6 million Americans who were previously covered by employer plans.   
      
  • The subsidies will overwhelmingly benefit wealthier Americans more than the vulnerable. $26 billion will go towards individuals making more than 700% of the federal poverty level (FPL) or roughly $90,000 per year.   
      
  • The subsidies are untargeted: roughly $200 billion in PTC spending – over 77 percent – is dedicated to those who benefit from Democrats eliminating means-testing on Obamacare subsidies and those who are already insured.   
      
  • Further mandates on job-creators would cost $11 billion in taxpayer dollars and lead to approximately 300,000 employees losing their existing job-based health plans.   
      
  • Extending premium tax credit subsidies to those receiving unemployment will cost roughly $11 billion over 10 years and further discourage individuals to return to work.   
      
  • A new “Federal Medicaid” program will cost taxpayers $323 billion over 10 years to force 3.8 million people onto a new government-controlled health care program, paving the way for a “public option.”” 

 

In addition to these health care policies, Democrats are also pushing for the inclusion of H.R. 3 in the reconciliation bill, legislation that would create a 95 percent excise tax on manufacturers and impose an international reference pricing scheme that directly imports foreign price controls into the U.S.   

This legislation would stifle innovation, limit Americans’ access to new cures and treatments, would cost high-paying jobs across the country, and would reduce the United States’ global dominance in medical innovation. It would lead to a 29.2 to 60 percent reduction in R&D spending, which translates to 167 to 324 fewer new drug approvals.  

Additionally, the pharmaceutical industry directly or indirectly accounts for over four million jobs across the U.S and in every state, according to research by TEconomy Partners, LLC. This includes 800,000 direct jobs, 1.4 million indirect jobs, and 1.8 million induced jobs, which include retail and service jobs that are supported by spending from pharmaceutical workers and suppliers. The average annual wage of a pharmaceutical worker in 2017 was $126,587, which is more than double the average private sector wage of $60,000. H.R. 3 would threaten these existing, high-paying jobs by imposing taxes and price controls on American businesses.

The healthcare policies being pushed by Democrats will end up hurting families and patients. It will increase the federal deficit, reduce access to lifesaving cures, and kick millions off their healthcare coverage. To be clear, this is just one of many reasons to oppose Democrats’ reconciliation bill - the legislation also imposes crippling tax hikes, a radical expansion of welfare, Green New Deal climate policies. These reckless policies should be rejected.

Photo Credit: "Health Insurance Claim Form" by Franchise Opportunities is licensed under

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To Protect Due Process, Lawmakers Should Reject the False Claims Amendments Act

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Posted by Isabelle Morales on Wednesday, October 20th, 2021, 1:15 PM PERMALINK

Tomorrow, the Senate Judiciary Committee will be holding a markup on S. 2428, The False Claims Amendments Act of 2021, legislation introduced by Senator Chuck Grassley (R-Iowa) and Patrick Leahy (D-Vt.). This bill would flip due process on its head by modifying the burden of proof in False Claims Act (FCA) cases so that companies would be required to prove their innocence, instead of requiring the government to prove its own case against defendants. Lawmakers should reject this proposal.

Specifically, the legislation requires defendants to disprove the plaintiff’s contention with a heightened “clear and convincing” standard of proof. In this way, the defendant’s burden to prove their innocence is higher than the plaintiff’s burden of proof to prove the defendant’s guilt. To make matters worse, this would apply retroactively to any FCA case that is pending on the date of enactment.  

FCA cases are taken up when the government suspects a company has falsely billed the government, over-represented the amount of a delivered product, or under-stated an obligation to the government.  

Adopting this new evidentiary standard ignores the views of an unanimous Supreme Court. Universal Health Servs. v. U.S. ex rel. Escobar explained that the FCA materiality element is “demanding” and “rigorous” because of its potentially penal application, detailing that the FCA “is not ‘an all-purpose antifraud statute’ or a vehicle for punishing garden-variety breaches of contract or regulatory violations.”   

In this case, the Court required the government to prove that the alleged false claim “went to the very essence of the bargain,” but imposed no additional burden on defendants in these cases. Imposing a higher burden of proof for defendants than for plaintiffs in these cases is the opposite of what the SCOTUS attempted to achieve in Escobar

While this amendment makes it more difficult for companies to defend themselves, it also shifts the cost of government discovery to defendants. It would require defendants to pay the government’s attorney fees and discovery costs unless the defendant proves that the information sought is “relevant, proportionate to the needs of the case, and not unduly burdensome.” As the National Law Review notes, this would “effectively require defendants to pay for the costs of government discovery in nearly every case because of the practical impossibility of proving a negative – the absence of an undue burden on the government.”  

The Grassley-Leahy bill would establish an evidentiary standard that is antithetical to both the aforementioned 2016 SCOTUS case and the principles which guide the function of our court system. If lawmakers are serious about protecting defendants’ presumption of innocence, a principle core to this country’s judicial system, they should reject this legislation. 

Photo Credit: "Tower of Light" by Victoria Pickering is licensed under CC BY-NC-ND 2.0.

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VIDEO: Americans Oppose IRS Snooping on Their Bank Account

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Posted by John Kartch on Wednesday, October 20th, 2021, 9:05 AM PERMALINK

Today Americans for Tax Reform released a video compilation of on-the-street interviews from local news reports showing firm, categorical opposition to the concept of IRS snooping on their bank accounts. The Democrats' new $10,000 threshold changes nothing.

Excerpts from the video:

“I don’t see what business it is of anyone’s what I spend out of my bank account."

“No, it’s not their business. I already tell them enough.” 

 “I don’t feel that’s appropriate, that the IRS should be looking into people’s bank accounts.”

“They’re trying to get in to see every little thing you’re doing.”

“It could be a little invasive.” 

“It’s kind of over the top and I just think that it’s an invasion of privacy.”

“Our bank accounts, you’d think would be somewhat private if you’re just a regular Joe Schmo making money week-to-week.”

“I do not think the government should be intervening in individual bank accounts.”

“It is personal information, that’s why we file taxes, too. You know, they should not have access to all that stuff.”

“I don’t think it’s right, it’s not their business what’s in my bank account.” 

Click here or below to view:

Photo Credit: Cliff from Arlington, Virginia, USA, CC BY 2.0


ATR Leads Coalition Letter Opposing Sen. Warren's "Stop Wall Street Looting Act"

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Posted on Tuesday, October 19th, 2021, 4:00 PM PERMALINK

Today, Americans for Tax Reform led a coalition letter in opposition to Senator Elizabeth Warren's (D-Mass.) Stop Wall Street Looting Act, which is being reintroduced in the wake of the Senate Banking Economic Policy Subcommittee's upcoming hearing titled “Protecting Companies and Communities from Private Equity.”

Senator Warren's bill would increase taxes, hurt private investment, eliminate jobs, and threaten the lifesavings of countless Americans. ATR's letter was signed by 20 other organizations.

You can read the letter below or here:

October 19, 2021

Dear Senators Warren & Kennedy, 

We are writing to express our concern about the upcoming hearing in the Senate Banking Economic Policy Subcommittee titled “Protecting Companies and Communities from Private Equity.” More specifically, we are strongly opposed to legislation like Senator Warren’s Stop Wall Street Looting Act, which would increase taxes, stifle private investment, eliminate jobs, and threaten the life savings of Americans across the country. We urge the Committee to reject this legislation and any similar legislation that would harm workers, retirees, and pensioners. 

It appears that Senator Warren is using this subcommittee hearing as an opportunity to reintroduce and highlight her Stop Wall Street Looting Act, a dangerous bill that could crush thousands of businesses at a time when the economy is still trying to recover from the COVID-19 pandemic. The bill is concerning for a number of reasons: 

  • Tax increases on investment: By sharply raising taxes on long-term capital gains, the bill would dampen returns of universities, startup ventures, and pensioners. Raising taxes on carried interest is part of a long-running campaign by some to raise taxes on all capital gains investment. A recent study found that raising taxes on carried interest could eliminate up to 4.9 million jobs and cost pension funds up to $3 billion per year. The bill also creates a 100% surtax on certain fees and denies legitimate interest deductions for disfavored private companies.   
      
  • Imposes new mandates: The bill penalizes private investment based entirely on the ownership structure of the underlying businesses. The legislation would impose new and onerous legal liabilities on private investors and managers that do not exist for other investors, including through a radical rewrite of the bankruptcy code. These liabilities would make it exceedingly difficult to invest in struggling businesses.   
      
  • Penalizes workers & retirees: These new regulations would make it harder for pension funds to generate stronger returns for the teachers, fire fighters and public-sector workers whose retirements depend on the performance of these investments. The bill could also cost investors as much as $3.36 billion each year, with almost half of the loss accruing to pension fund retirees.   
      
  • Eliminates jobs: Senator Warren’s legislation would erase anywhere from 6 to 26 million jobs from the American economy and reduce federal, state and local tax revenue by as much as $475 billion each year, according to a study by the United States Chamber of Commerce. 

 

As we have seen time and time again throughout history, when you tax and overregulate an activity, you get less of it. Unfortunately for workers and retirees across the country, the result of the Stop Wall Street Looting Act would hurt the livelihoods of the 11.7 million workers directly employed by private equity-backed companies. 

In 2019, when Senator Warren introduced the Stop Wall Street Looting Act, the Wall Street Journal noted that “every policy she proposes would increase government control over the private economy.” Unfortunately, the newest version of the bill stays the course. Instead of attacking private sector employers with legislation like the Stop Wall Street Looting Act, we urge the Subcommittee to focus on solutions that will empower workers.

Sincerely,

Grover Norquist
President, Americans for Tax Reform

Phil Kerpen
President, American Commitment

Krisztina Pusok, Ph. D.
Director, American Consumer Institute

Brent Wm. Gardner
Chief Government Affairs Officer, Americans for Prosperity

Ryan Ellis
President, Center for a Free Economy

Andrew F. Quinlan
President, Center for Freedom and Prosperity

Jeffrey Mazzella
President, Center for Individual Freedom

Tom Schatz
President, Council for Citizens Against Government Waste

Iain Murray
Vice President, Competitive Enterprise Institute

Matthew Kandrach
President, Consumer Action for a Strong Economy

Adam Brandon
President, FreedomWorks

George Landrith
President, Frontiers of Freedom

Garrett Bess
Vice President, Heritage Action for America

Andrew Langer
President, Institute for Liberty

Seton Motley
President, Less Government

Tom Hebert
Executive Director, Open Competition Center

Bryan Bashur
Executive Director, Shareholder Advocacy Forum

Saulius “Saul” Anuzis
President, 60 Plus Association

Jim Martin
Founder/Chairman, 60 Plus Association

Karen Kerrigan
President & CEO, Small Business & Entrepreneurship Council

David Williams
President, Taxpayers Protection Alliance

CC: Full Senate Banking Committee 

Photo Credit: "Elizabeth Warren" by Gage Skidmore is licensed under CC BY-SA 2.0.

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Guy Nohra signs Taxpayer Protection Pledge

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Posted by Americans for Tax Reform on Tuesday, October 19th, 2021, 2:21 PM PERMALINK

Americans for Tax Reform commends Guy Nohra, candidate for Governor of Nevada, for signing the Taxpayer Protection Pledge, a written commitment to Nevada taxpayers that, if elected, he will oppose and veto any and all efforts to raise taxes. 

Guy Nohra has made it clear that he will maintain Nevada’s 0% income tax rate. With Nohra’s signing of the taxpayer protection pledge, Nevada households can rest assured that state taxes will not go up during a Nohra administration. 

“I’m proud to be the first and only candidate for Nevada Governor to sign the Americans for Tax Reform Taxpayer Protection Pledge. As Governor, I want Nevada taxpayers know that I will always have their back,” Nohra said.  

By signing the Taxpayer Protection Pledge, candidates and incumbents make a written commitment to oppose any and all tax increases. While ATR has the role of promoting and monitoring the Pledge, the Taxpayer Protection Pledge is made to a candidate’s constituents, who deserve to know where candidates stand on the tax issue. Since the Pledge is a prerequisite for many voters, it is considered binding as long as an individual holds the office for which they signed the Pledge. 

“I want to congratulate Guy Nohra for taking the Taxpayer Protection Pledge, A written commitment to Nevadans, who deserve better than tax-and-spend policies that fall hard on the backs of hardworking families and small businesses. They want real solutions that create jobs, cut government spending, and make Nevada a more attractive place to live and raise a family,” said Grover Norquist, president of ATR. 

 “By signing the Pledge, Guy has demonstrated that he understands the problems of hard-working taxpayers in Nevada. Steve Sisolak has made it clear he will continue to pursue a higher tax and spend agenda that grows government and increases the burden of state spending on taxpayers. Nevadans deserve better” Norquist continued. 

Today, the Taxpayer Protection Pledge is offered to every candidate for state and federal office and to all incumbents. Nearly 1,400 elected officials, from state representative to governor to US Senator, have signed the Pledge.  

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. 

Candidates for governor can still make this important commitment to voters by visiting: www.atr.org/take-the-pledge  

Photo Credit: Guy Nohra Facebook Page

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5 Times Sen. Kyrsten Sinema Voted Against Carbon Taxes

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Posted by Mike Palicz on Tuesday, October 19th, 2021, 11:20 AM PERMALINK

Senate Democrats are pushing a carbon tax that would increase the cost of gasoline and household electricity bills in order to raise revenue for President Biden’s multi-trillion dollar tax and spend blowout, a clear violation of Biden’s pledge to not raise any form of tax on anyone making less than $400,000 per year.

According to reporting from Politico this morning, the new push for a carbon is facilitated by Sen. Kyrsten Sinema (D-Arizona), whose opposition to other proposed tax increases has caused her Democrat colleagues to come up with additional options to pay for their progressive wish list.

Democrats are reportedly considering a carbon tax that starts around $20 per ton and ramps up every year thereafter. The Congressional Budget Office has previously estimated that a $20 per ton carbon tax would increase taxes by $1.2 trillion over a decade while the center-left Tax Policy Center found a $20 per ton carbon tax reduces the pre-tax income of households in the lowest income quintile by nearly one percent.

However, Sen. Sinema has a long and consistent voting record opposing all forms of a carbon tax, as Americans for Tax Reform documents below. If Sen. Sinema were in fact to support a carbon tax, it would be a clear reversal of her Congressional voting record to date.

Below are five instances Sen. Sinema voted against a carbon tax and the regulation of carbon emissions.

1.  2013 – Sinema votes to block the Obama Administration from unilaterally implementing a carbon tax.

In 2013, Sinema was one of twelve House Democrats voting in support of an amendment to the REINS Act (Regulations From the Executive in Need of Scrutiny Act of 2013) that required the Administration to receive approval from Congress before implementing a carbon tax.

Notably, the amendment backed by Sinema inserted language into the bill that stated, “as a tax on carbon emissions increases energy costs on consumers, reduces economic growth and is therefore detrimental to individuals, families and businesses, the REINS Act includes in the definition of a major rule, any rule that implements or provides for the imposition or collection of a tax on carbon emissions.''

2.  2016 – Sinema votes in support of Steve Scalise’s anti-carbon tax resolution

As a member of the House of Representatives in 2016, Sinema voted in support of Republican Whip Steve Scalise’s anti-carbon tax resolution. Sinema was one of six House Democrats that joined with House Republicans in support of  H.Con. Res.89, which stated “a carbon tax will fall hardest on the poor, the elderly, and those on fixed incomes,” and “a carbon tax will increase the cost of every good manufactured in the United States.”

3.  2018 In the midst of her Senate campaign, Sinema again votes in support of the Scalise anti-carbon tax resolution

In July of 2018, while she was in the heat of a tight election for her current Senate seat, Sinema again voted in support of Republican Whip Steve Scalise’s anti-carbon tax resolution. Sinema was one of seven Democrats that joined with House Republicans in support of H.Con.Res.119 which stated “a carbon tax will mean that families and consumers will pay more for essentials like food, gasoline, and electricity,” and “American families will be harmed the most from a carbon tax.”

4.  April 2021 – Sen. Sinema introduces legislation to prevent the regulation of livestock emissions

Sen. Sinema and Sen. John Thune (R- South Dakota) introduced legislation in April to prevent the EPA from regulating carbon and methane emissions from livestock production.

“Cutting unnecessary regulations frees Arizona cattlemen from costly permit fees and keeps prices affordable for Arizona families,” said Sinema in a press release accompanying the introduction of her legislation.

A carbon tax would be levied on agricultural emissions, including those from livestock production and require regulation from the EPA.  

5.  August 2021 – Sen. Sinema votes to prohibit new methane requirements on livestock

In August, Sinema voted in favor of an amendment to “establish a deficit-neutral reserve fund relating to prohibiting or limiting the issuance of costly Clean Air Act permit requirements on farmers and ranchers in the United States or the imposition of new Federal methane requirements on livestock.”

Americans for Tax Reform opposes any effort to impose a carbon tax and urges Sen. Sinema to maintain her long and consistent record opposing a carbon tax.

Photo Credit: Gage Skidmore

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Democrats’ Taxes on Investment will Harm Start-Up Businesses

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Posted by Bryan Bashur on Tuesday, October 19th, 2021, 11:17 AM PERMALINK

Democrats have proposed numerous tax increases on investment. President Biden’s budget called for doubling the tax rate on capital gains from 23.8 percent to 43.4 percent while the House Democrats $3.5 trillion tax and spend bill proposed raising the capital gains tax to 28.8 percent. However, under the House Democrat proposal investors in small private companies will be hit twice because of the repeal of the tax exclusion on qualified small business stock (QSBS). 

Currently, the tax code allows for individuals and pass-through entities to exempt up to 100 percent of gains made on the sale of qualified small business stock if it was acquired at issuance, and held for at least five years in a C corporation with aggregate gross assets of $50 million or less. Individuals or pass-through entities can sell up $10 million, or “10 times the investor's basis in the stock,” in QSBS and still qualify for the tax exclusion. 

If this exclusion is repealed individuals would pay a 25 percent tax on capital gains from the sale of QSBS. In addition, they would pay the 3.8 percent Obamacare net investment income tax and could pay the 3 percent surtax for individuals making more than $5 million. 

In addition, taxpayers would have to pay state capital gains taxes. In California, for instance, they would have to pay an additional 13.3 percent tax resulting in a staggering tax rate of 45.1 percent.

This would be significantly higher than the tax rate charged by foreign competitors. For instance, the capital gains rate in Communist China is 20 percent, so the United States would be far less competitive.

If an investor knows they are going to lose nearly half of the gain on their stock when they sell, they may likely decide to reel back investment or invest in a different country with lower tax rates.

According to a memorandum prepared by RSM, there are clear benefits that come from the section 1202 tax exemption. RSM states that the 100 percent exclusion has “spurred interest in investments into start-up and other small businesses.”  Additionally, Patrick Smith of CliftonLarsonAllen, makes a similar statement about the impact of section 1202. In a quote he provided to the Angel Capital Association, he states that, “Section 1202 stock is one of the most powerful tools Congress has ever provided to small businesses.”

Notably, this tax increase proposed by House Democrats could reduce competition. By eliminating the section 1202 tax advantage, Democrats are threatening to reduce a vital source of capital for small businesses. According to Fred Tannenbaum at Gould & Ratner, section 1202 has provided low-cost access to capital for small businesses that are aspiring to “to be the next Amazon, Google or 10X Genomics.”

The proposal, as drafted in the House Ways and Means Committee title of the budget reconciliation bill, could drastically diminish competition and bolster market share for large companies.

Congress should reject efforts to raise taxes on investment including through the repeal of section 1202. Maintaining this provision will help ensure private capital can continue to flow to small businesses for years to come.  

Photo Credit: "US Capitol" by kidTruant is licensed under CC BY-SA 2.0


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