Another Biden Middle Class Tax Hike: Elimination of Your Step-Up in Basis

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Posted by John Kartch on Friday, October 23rd, 2020, 5:15 PM PERMALINK

Joe Biden will eliminate step-up in basis and this will impose a steep tax increase and paperwork nightmare for middle class families and small businesses. It is one of the many Biden tax hikes that violate his own pledge against raising any tax on any American making less than $400,000.

In this video, you can see a sample of the many times Biden has threatened to eliminate step-up in basis.

Under the Biden plan, "When someone dies and the asset transfers to an heir, that transfer itself will be a taxable event, and the estate is required to pay taxes on the gains as if they sold the asset,” said Howard Gleckman of the left-leaning Tax Policy Center.

As noted by CNBC:

By taxing the unrealized gain at death, heirs would get hit at the transfer, regardless of whether they sell the asset, Gleckman said.

In Forbes, Robert W. Wood writes of the devastating impact on small businesses:

[Under current law] Everybody gets a stepped-up basis on death, for income taxes. But Biden says maybe no longer. Biden says that'll be gone once he is President. Biden's proposal would tax an asset's unrealized appreciation at transfer. You mean Junior gets taxed whether or not he sells the business? Essentially, yes. The idea that you could build up your small business and escape death tax and income tax to pass it to your kids is on the chopping block. Biden would levy a tax on unrealized appreciation of assets passed on at death. By taxing the unrealized gain at death, heirs would get hit at the transfer, regardless of whether they sell the asset.

In its analysis of Biden's tax plan, Tax Policy Center says the step-up in basis proposal mirrors a proposal described in an Obama-Biden 2016 Treasury Department document. This document confirms that Biden will force a capital gains tax payment immediately upon transfer of an asset after death of a loved one:

Under the proposal, transfers of appreciated property generally would be treated as a sale of the property. The donor or deceased owner of an appreciated asset would realize a capital gain at the time the asset is given or bequeathed to another.

The amount of the gain realized would be the excess of the asset's fair market value on the date of the transfer over the donor's basis in that asset. That gain would be taxable income to the donor in the year the transfer was made, and to the decedent either on the final individual return or on a separate capital gains return.

On top of all that, Biden also vows to impose capital gains tax increases just as America digs out from the pandemic. He said "every single solitary person" will pay capital gains taxes at ordinary income tax rates. He will also double the top rate to 40 percent, highest since Jimmy Carter in 1977.

Click below to see Biden's vow to eliminate stepped-up basis:

Photo Credit: Matt Johnson

Taiwan’s President Tsai Expresses Interest in U.S.-Taiwan Free Trade Agreement

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Posted by Mary Ann Cortese on Friday, October 23rd, 2020, 11:51 AM PERMALINK

Taiwan President Tsai Ing-Wen seeks to bring forward free trade talks with the U.S. With Taiwan being a long-standing trade partner of America, this big step by Taiwan to strengthen the U.S-Taiwan relationship could potentially create new economic, social and political opportunities for the nation which faces pressure from China.

Taiwan is already a well-established trading partner for the U.S. The country was the 11th largest goods trading partner in 2018 with the U.S. totaling $76.0 billion in two-way trade of goods in 2018 and $18.5 billion in services.

A comprehensive trade deal with Taiwan can offer U.S. companies an alternative to doing business with Beijing, this would be a crucial lifeline in certain sectors. As President Tsai said during a video presentation hosted by the Hudson Institute and Center for American Progress that “the past months have shown us the importance of economic linkages and supply chain security for both Taiwan and the U.S.” and “[Taiwan and the U.S.] must be clear-eyed on how to move forward on an FTA.”

Along with growth in two-way goods trade, an FTA can bring an increase in services trade, especially in FDI which would be a large beneficiary. In her speech, President Tsai called attention to the increased two-way investment flows linking the U.S. and Taiwan, stating that Google and Microsoft have “substantially increased their investments in Taiwan” over the last year. With Taiwan seeking to become a global hub for technology, a FTA with the U.S. can open the county up to deals with large American tech firms. The FTA could set groundbreaking rules on how to deal with SOE, prevent coerced technology transfers, and limit data localization, similar to those in the USMCA. 

This was the essence of a coalition letter Property Rights Alliance executive director Lorenzo Montanari signed alongside other conservative groups sent to president Trump. The letter calls on Trump to “look past the way business has been done in the past and take a fresh approach when the U.S. stands to gain. The veto power Beijing has exercised over this issue in the administration's past should be revoked. Nothing about an FTA with Taiwan is incompatible with serviceable, productive relations with China.”   

One of the longstanding complaints from the USTR preventing trade negotiations has been Taiwan’s prohibitions on meat from the U.S. entering their market. That barrier is no longer there, as president Tsai announced the easing of restrictions on imports of U.S. pork and beef earlier last month. It was done for national interest but also, in the words of president Tsai “If we can take one crucial step forward on the issue of U.S. pork and beef, it will be an important start for Taiwan-U.S. economic cooperation at all fronts.”  

Secretary of State Michael Pompeo said that “this move opens the door for even deeper economic and trade cooperation” and “kudos to president Tsai for her leadership.”

With members of the U.S. Senate believing now is the perfect time to start trade negotiations with Taiwan, a joint letter was sent to U.S. Trade Representative Bob Lighthizer encouraging him to begin the formal process of negotiating a trade agreement with Taiwan. The senators said, “as we look to advance our initiative for a free and open Indo-Pacific, we believe that now is the time to establish trade agreements with like-minded counties in the region.”

With Tsai’s bold response regarding this long-standing issue, the ball now remains in the U. S’s court to start a formal process to institute a free trade agreement with Taiwan. Entering into the negotiation process can help advance America’s strategic vision for a free and open Indo-Pacific region, as well as strengthen the U.S economic partnership with Taiwan.

Photo Credit: Daniel M. Shih

More from Americans for Tax Reform

Murkowski Puts Massive Carbon Tax “On The Table” During Event with Sheldon Whitehouse

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Posted by Mike Palicz on Thursday, October 22nd, 2020, 3:45 PM PERMALINK

Senate Energy and Natural Resources Chairwoman Lisa Murkowski (R-Alaska) said a carbon tax "is worth putting on the table" during a panel discussion yesterday with Senator Sheldon Whitehouse (D-RI) sponsored by the Stanford Institute for Economic Policy Research.

"I know that a price on carbon is one that makes Republicans more than a little bit nervous," continued Murkowski. "But I do think that can be and that should be one of the options that is on the table for discussion, in terms of how you can move policies forward," she said.

Sen. Murkowski is correct to note that carbon taxes, which raise the cost of gasoline and household energy bills, face significant political opposition as voters have a well-established track of rejecting carbon taxes on the ballot.

Last Congress, 229 House Republicans voted in favor of an anti-carbon tax resolution. In 2019, a coalition of 90 conservative and free-market organizations penned a letter to Congress opposing any form of a carbon tax. Sen. Murkowski’s support for a carbon tax would make her the only Republican in the Senate on record backing such a tax.

Even the panel moderator noted he was “struck” that Sen. Murkowski “in a state where oil and gas production is so critical, was willing to look closely at carbon pricing.”

Sen. Murkowski’s call for a carbon tax is indeed shocking given that roughly 85% of Alaska’s state budget is funded from oil revenues.

When pressed by the event’s moderator to explain how her plan would deal with low-income Americans facing higher energy costs, Murkowski suggested using the generated revenue for wealth redistribution. “As you know there have been proposals if there is a price, how you can rebate that to individuals, how you can help with transition assistance. These are the types of policies, and discussions, that must be had,” said Murkowski.

Translation: Murkowski suggests using the revenue generated from a carbon tax to send apology checks to poor Americans for raising their energy costs. 

Sen. Murkowski’s comments seem to reference carbon tax and rebate legislation pushed by progressive advocacy groups like Climate Leadership Council and Citizens’ Climate Lobby. According to a recent study from the Tax Foundation, a commonly proposed carbon tax and rebate plan (starting at $50 per metric ton) would raise taxes by $1.87 trillion over ten years, kill 421,000 jobs and reduce GDP by 0.4 percent.

Americans for Tax Reform urges Sen. Murkowski to take carbon taxes completely off the table and instead focus on policies that reduce energy costs for American consumers rather than add to their burden.

Photo Credit: Senator Lisa Murkowski - Energy and Natural Resources Committee

More from Americans for Tax Reform

Biden's Individual Mandate Tax Shatters His $400,000 Pledge and Hits Swing State Households Hard

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Posted by John Kartch on Thursday, October 22nd, 2020, 12:33 PM PERMALINK

Joe Biden said he will re-impose the Obamacare individual mandate tax if he is elected. Most households liable for this tax made less than $50,000 per year.

According to IRS data, Biden's individual mandate tax would hit roughly 353,000 households in Florida and 153,000 households in Pennsylvania. (See the full list of state figures at bottom).

The Tax Cuts and Jobs Act signed by President Trump zeroed out the $695-$2,085 Biden-Obama individual mandate tax.

But Biden has already vowed to re-impose the individual mandate tax. Here's his exchange with CNN on July 5, 2019:

CNN's Chris Cuomo: "Would you bring back the individual mandate?"

Joe Biden: "Yes. Yes, I'd bring back the individual mandate."

See for yourself by watching the clip below:

According to official IRS data for the 2017 tax year, 74% of households liable for the individual mandate tax had an adjusted gross income of less than $50,000.

  • The individual mandate tax penalty was paid by 4,606,271 households.
  • 3,430,003 of these households had an adjusted gross income of less than $50,000.

Biden has some explaining to do, as he made a promise to every American making less than $400,000 per year that they would not see a single penny of ANY tax hike. This Biden tax will hit middle class households in every state and every congressional district.

IRS data below shows the number of households per state hit with this tax in just one year, 2017. This data serves as an approximation of how many households will be hit under Biden's individual mandate tax.


Pennsylvania              153,140 households
Florida                         353,210 households
Minnesota                    69,460 households
Wisconsin                   80,240 households
Michigan                     132,750 households 
Ohio                           132,140 households
North Carolina           141,730 households
Arizona                       107,360 households 
Colorado                     98,160 households
Georgia                        142,930 households
Nevada                        52,130 households


Alabama                     41,960 households
Alaska                        13,370 households
Arizona                       107,360 households 
Arkansas                     41,130 households
California                    553,000 households
Colorado                     98,160 households
Connecticut                 45,200 households
Delaware                     11,230 households 
District of Columbia    5,170 households
Florida                         353,210 households
Georgia                        142,930 households
Hawaii                         10,890 households
Idaho                           31,460 households 
Illinois                         162,920 households
Indiana                        106,750 households
Iowa                            38,430 households
Kansas                         40,480 households
Kentucky                     54,310 households 
Louisiana                     64,330 households
Maine                          25,460 households
Maryland                     64,180 households
Massachusetts             89,050 households
Michigan                     132,750 households 
Minnesota                    69,460 households
Mississippi                  32,260 households
Missouri                      80,990 households
Montana                      19,770 households
Nebraska                     30,930 households 
Nevada                        52,130 households
New Hampshire          23,610 households
New Jersey                 124,430 households
New Mexico               25,500 households
New York                   260,660 households 
North Carolina           141,730 households
North Dakota             11,970 households
Ohio                           132,140 households
Oklahoma                   54,720 households
Oregon                        70,010 households 
Pennsylvania              153,140 households
Rhode Island              14,840 households
South Carolina            64,440 households
South Dakota              11,190 households 
Tennessee                    83,440 households
Texas                           559,420 households
Utah                            49,470 households
Vermont                      10,920 households
Virginia                       107,130 households 
Washington                 110,400 households
West Virginia              22,820 households
Wisconsin                   80,240 households
Wyoming                    11,090 households

Keep track of Biden's many tax hikes by visiting

See also:

Flashback: Joe Biden Broke His Middle Class Tax Pledge

Biden Wants to Raise U.S. Corporate Tax Rate Higher Than Communist China





Illinois “Fair Tax” Amendment Opens Door for Billions in Additional Tax Hikes

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Posted by Miriam Roff, Sheridan Nolen on Wednesday, October 21st, 2020, 3:36 PM PERMALINK

The fate of Illinois’ constitutionally mandated flat tax lies in the hand of voters, who will decide on Nov. 3, 2020 whether or not to adopt the Proposed Amendment to the 1970 Illinois Constitution— also known as the “fair tax” amendment or the “Illinois Allow for Graduated Income Tax Amendment.”

A NO vote would uphold the state’s current 4.95% flat income tax rate. A YES vote would open the door for significant state income tax hike, with the top rate rising to 7.99%.

By voting YES, voters will eliminate the only safeguard Illinois taxpayers have against income tax hikes, the flat tax— allowing Governor J.B. Pritzker and the Democrat-controlled state legislature to impose some of the highest tax rates in the nation with little or no recourse. If the measure is approved, on January 1, 2021 Illinois would move from a flat 4.95% income tax to new six bracket system with rates ranging from 4.75% to 7.99%, resulting in a  $3.7 billion income tax increase. 

It’s important to note that although the new rates and brackets, as passed by the Democrat-led legislature under SB 687 in 2019, are separate from the proposed constitutional amendment, this $3.7 billion income tax hike is completely dependent upon voters permitting a graduated-rate income tax structure.

Proponents of the progressive tax amendment are selling it as the be-all-end-all solution for ending the state’s infamous budgetary woes, claiming SB 687 will actually lower taxes for 97 percent of Illinois residents. The former is a flat out lie, whereas the latter is barely even a half truth.

If the amendment is approved, it’s true that Illinois taxpayers with up to $100,000 in income would see their marginal tax rate drop from 4.95% to 4.75% or 4.90% depending on their income level. However, the expected $3.7 billion in new revenue raised off the backs of the rest of the populace would barely make a dent in Illinois’ whopping $226 billion deficit.

Further, the proposed amendment does not contain language that limits the amount of tax brackets state lawmakers can create or how high they can raise taxes. The graduated income tax measure also provides zero accountability measures on how the new money will be spent and fails to address years of runaway spending. Keep in mind the Governor has promised over $10 billion in new spending despite the state being broke. Odds are any tax relief for middle and lower-income families would be short-lived.

According to research conducted by Americans for Tax Reform, government spending has ballooned over the last decade. In fact, Illinois had the nation’s second highest increase in spending per capita, rising 29.30%, between 2010 and 2018. During this time, Illinois raised the state income tax twice to fund this out-of-control spending. Further, just last year state lawmakers hit taxpayers with 20 new tax increases including the doubling of the gas tax, vehicle registration fee hikes, and the increase of online sales taxes. Even with all these tax increases the state still had an $8 billion budget deficit and an unfunded pension liability over $137 billion prior to the Covid-19 pandemic.

As the Illinois Policy Institute points out, for Democratic lawmakers to fully finance all of the Governor’s campaign promises and plug budget holes, a typical middle-class family could end up paying $3,500 more in income taxes. Even Gov. Pritzker admits that “there’s certainly no guarantees” that the amendment would protect middle and lower-income Illinoisans from future tax hikes.

The governor’s claim that there’s certainly no guarantees is correct. Take, for instance, Connecticut—the one state that has swapped out its flat income tax for a progressive income tax in the last 30 years. Nutmeg State lawmakers touted the progressive income tax as a way to fix state finances, address inequality, and promised spending restraint. However, that’s not what happened. It instead, cost the state’s economy over $10 billion, 360,000 jobs, and middle class families have seen their income tax rates climb over 13% and their property tax burden increase by more than 35% since 1999—the year that the personal income tax was first collected. As a result of these failed policies, Connecticut dons the 6th highest outmigration rate in the nation.

If voters need another reason to reject a progressive income tax structure with the higher rates set by SB 687, it’s worth remembering that it would kill jobs and small businesses by imposing the second-highest business tax rate in the nation. Under the Governor’s Fair Tax Plan, the corporate tax rate would rise from 7% to 7.99%, and when you take into account the 2.5% replacement tax already imposed on Illinois corporations, the total taxable rate is 10.49%. In 2018, the U.S. Bureau of Labor Statistics reported that Illinois’ private sector job growth ranked 46th out of 50 states. With the coronavirus pandemic looming over the heads of local businesses, many of which are on the brink of bankruptcy, the proposed Illinois income tax hike would exacerbate the financial hardships of a dilapidated economy.

A study conducted by the University of Illinois indicated that the state of can expect more than half a million full-time job losses and tens of billions of dollars in lost income over the next year as a result of the novel coronavirus. Illinois had already lost a record 850,000 residents over the last decade. By instituting another financial requirement on employers, this would be the last straw for thousands of small businesses and large employers, driving them to leave the state.

Giving Illinois lawmakers a blank check to spend billions of taxpayer dollars however they please will not provide a different outcome this time. The only way to address the state’s financial crisis is by reining in/reforming government spending in a way that taxpayers can afford. If taxpayers in Illinois truly wish to take a stand for fiscal responsibility and accountability, they should vote ‘NO’ on the graduated income tax amendment this November.

Photo Credit: Alan Cleaver

ATR Releases New Video Against Foreign Price Controls on Medicare

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Posted by Alex Hendrie on Wednesday, October 21st, 2020, 11:57 AM PERMALINK

ATR has released a new video highlighting free market opposition to efforts to impose price controls on medical innovation and seniors in Medicare.

The video, narrated by ATR President Grover Norquist, highlights the coalition of 80 conservative, free market, libertarian groups, and activists that oppose the “most favored nation (MFN)" executive order to tie the prices we pay for medicines to foreign, socialist healthcare systems. 

Foreign countries have been free riding off American medical innovation for decades through crushing price controls and other market-distorting government rules and regulations.

If we adopt these same price controls, we will do significant harm to the healthcare system. Studies have shown that countries with price controls have access to fewer innovative cures leading to healthcare shortages.

For instance, 290 new medical substances were launched worldwide between 2011 and 2018. While Americans had access to over 90 percent of these medicines, countries with price controls had limited access – the United Kingdom had access to only 60 percent of these medicines, Japan had 50 percent, and Canada had just 44 percent.

Implementing price controls through an MFN will also threaten the ability of our country to continue recovering from COVID-19. The U.S. is the best in the world when it comes to developing innovative, lifesaving, and life preserving medicines. Because of this, the U.S. is leading the way when it comes to developing COVID-19 vaccines, with several promising candidates entering the final stages of testing and clinical trials. 

In addition, price controls could harm the U.S. economy. Medical innovation directly or indirectly supports 4 million jobs and $1.1 trillion in total economic impact, including jobs in every state. These jobs will be threatened by price control schemes like the MFN. 

Rather than imposing price controls, lawmakers and President Trump should adopt a deregulatory, market-based approach that allows free market innovation to flourish. Moving forward, we should look to policy proposals that promote medical innovation and the development of new cures and reject efforts to impose price controls on the American healthcare system. 

The full video can be found here: 

Photo Credit: Wellness GM

Tax Hikes on Vaping on the Ballot in Oregon, Colorado

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Posted by Matt Owens on Tuesday, October 20th, 2020, 1:08 PM PERMALINK

Misguided tax hikes on vaping threaten public health in Oregon and Colorado. Both states have upcoming ballot measures which would increase taxes on cigarettes and vaping, even though Public Health England and the Royal College of Physicians have concluded that e-cigarettes are at least 95% less harmful than cigarettes.

Oregon Measure 108 places the option on the ballot for voters to decide on a tax hike which would raise rates from 1.33$ per 20 pack of cigarettes to 3.33$. As it applies to E-Cigarettes, the ballot measure, if passed, would impose a tax at a rate of 65 percent of the wholesale sales price for the product. Cigars would also be effected by this ballot measure by increasing taxes from $0.50 to 1.00$ per cigar, this would raise the tax rate to 65 percent, which is its wholesale sales price cap.

The revenue generated from this ballot measure would go to funding multiple health programs for the state.  From 2008 to 2018 nine other ballot measures had been offered by states for a tobacco tax increase. The ballot measures in the past had all been defeated by voters; except Proposition 6 in California during 2016.

Colorado Proposition EE is another ballot measure tax hike. In Colorado cigarettes are currently taxed at a rate of 84 cents per pack.  The ballot measure would set up an incremental schedule to increase the tax rate for cigarettes to 1.80$ per pack by July 2027. This would result in a 2.64$ tax rate per pack overall. For cigars, the ballot measure would incrementally raise the tax rate from 20 percent to 22 percent by July 2027. E-Cigarettes are currently not taxed in Colorado.  This ballot measure would create a new tax for E-Cigarettes starting at 30 of percent manufactures list price in 2021, and incrementally increase to 62 percent of manufactures list price by July 2027. Most of the revenue from these new taxes will be geared towards education funding but, a sizable portion will also be directed towards the general fund.

These taxes make life-saving vape products more expensive and less accessible, and risk jobs and businesses as small vape shops will suffer. Meanwhile cigarette tax revenue is notoriously unreliable. Colorado and Oregon voters will have to consider the many downsides of these tax hikes as they head to the polls.

Photo Credit: Bonnie Moreland

Norquist: 50 Cent Speaks the Truth About Biden Tax Hike. "No one should have 62% of any dollar they earned taken by the government."

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Posted by Isabelle Morales on Tuesday, October 20th, 2020, 1:00 PM PERMALINK

Under Joe Biden's tax hikes, many households and small businesses will end up paying a top marginal tax rate above 60 percent.

Biden has vowed to steeply raise personal income taxes and impose an additional 12.4 percent payroll tax (along with a doubling of the capital gains rate to 40 percent). New York state has an 8.82 percent income tax and New York City takes another 3.876 percent

Referring to the combined Biden-NY-NYC tax burden on Monday, the rapper 50 Cent tweeted, "62% are you out of ya [expletive] mind."

50 Cent, or Curtis James Jackson III, was born in Queens, New York City and raised in its South Jamaica neighborhood. His mom Sabrina dealt drugs to get by, and raised Curtis until he was eight years old. She tragically died in a fire, leaving Curtis to be raised by his grandmother. 

At the time, the area was one of the toughest neighborhoods in New York. 50 Cent described how, in this environment, people had two options: welfare or hustling. From the time he was 12 years old, 50 Cent internalized these options and became a hustler. His love for rapping began in a friend's basement and, in 2002, his music career took off.

Despite having believed that he was bound to a lifestyle of welfare dependency or hustling, 50 Cent found his own way out, and broke the cycle of poverty and crime that he thought were his only options. It's no surprise that he doesn't take kindly to Joe Biden and New York politicians who want to take 62 cents of any dollar of earnings.

"50 Cent speaks the truth when he says no one should have 62% of any dollar they earned taken by government. 50 Cent speaks not just for rappers but for millions of small businessmen and women who would be hit by the high tax rates threatened by Biden and New York," said Grover Norquist, president of Americans for Tax Reform.

Check out ATR's compilation of Biden tax hike statements at


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Biden, Harris, and Greenfield Vow to Abolish Iowa's Right to Work Status

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Posted by John Kartch, Isabelle Morales on Tuesday, October 20th, 2020, 11:20 AM PERMALINK

Iowa has been a Right to Work state since 1947. But that will come to an end under Joe Biden, Kamala Harris, and Theresa Greenfield (D).

As seen on video and in writing, Biden and Harris vow to ban Right to Work laws which protect 166 million Americans in 27 states, more than half the U.S. population. Right to Work laws allow workers the freedom of employment without forced membership in a labor union or forced payment to a union boss.

Joe Biden said: "We should change the federal law [so] that there is no Right to Work allowed anywhere in the country. For real. Not a joke. Not a joke."

Kamala Harris said: "Banning Right to Work laws. That needs to happen."

Click here or below to watch Kamala Harris and Joe Biden vow to abolish Right to Work:

Harris and Biden also documented their anti-Right to Work position in writing here and here. And both have endorsed active legislation called the PRO Act which bans Right to Work. The PRO Act legislation is live ammunition, having already passed the Democrat-run U.S. House of Representatives. In the Senate, it has 40 Democrat co-sponsors and one self-described socialist co-sponsor, Bernie Sanders.

As stated in her op-ed in the Globe Gazette, Theresa Greenfield, the Iowa Democratic Senate candidate, endorses the PRO Act as well, meaning Iowa would lose its Right to Work status.

Right to Work states outperform non-Right to Work states:

  • Right to Work states experience stronger growth in the number of people employed, growth in manufacturing employment, and growth in the private sector. According to the National Institute for Labor Relations Research, the percentage growth in the number of people employed between 2007-2017 in Right to Work states was 8.8%, and 4.2% in forced-unionism states. Growth in manufacturing employment between 2012-2017 in Right to Work states was 5.5%, and 1.7% in forced-unionism states. The percentage growth in the private sector from 2007-2017 in Right to Work states was 13.0%, and 10.1% in forced-unionism states.


  • Right to Work laws increase individual life satisfaction and economic sentiment. A study by Christos Makridis of the Massachusetts Institute of Technology (MIT) found that Right to Work laws are associated with an increase in self-reported current life satisfaction, expected future life satisfaction, and sentiments about current and future economic activity among workers, as Forbes describes. The study explains that "these improvements in well-being are consistent with an increase in competition among unions, which prompts them to provide higher quality services that are valued by their members." As the Heritage Foundation explains, "It was no accident that foreign automobile brands located their U.S. plants primarily in right-to-work states like Alabama, Mississippi, and Tennessee."
  • Forced-unionism states experience severe out-migration. An analysis by Stan Greer of the National Institute for Labor Relations Research found that forced unionism states, between 2007-2017, experience net migration of -7.4%, whereas Right to Work states experience a 1.6% growth in number of residents. 
  • Right to Work laws protect workers from union corruption. The Detroit Free Press reported that U.S. Department of Labor documents showed embezzlement from hundreds of union offices across the country over the past decade. In the past two years, "more than 300 union locations have discovered theft, often resulting in more than one person charged in each instance." Workers should not be forced to fund entities that have high instances of theft and corruption, especially when there are no similar demands that citizens must directly fund a private organization.

Consider yourself warned: If Democrats win full control of the federal government, Iowa's Right to Work will be gone overnight.

"No one should have to pay someone for the right to have a job. Forced union dues were recognized as wrong when congress passed the Taft-Hartley Act of 1947," said Grover Norquist, president of Americans for Tax Reform. "Everyone in a free country has the right to work without being asked to pay off union bosses."

The 27 Right to Work states are: Florida, Wisconsin, Michigan, Iowa, Arizona, Georgia, North Carolina, South Carolina, Virginia, Texas, Tennessee, Indiana, Kentucky, Nevada, Oklahoma, Nebraska, South Dakota, North Dakota, Wyoming, West Virginia, Mississippi, Alabama, Louisiana, Arkansas, Idaho, Utah, Kansas.

See Also:

Biden and Harris Threaten Independent Contractors and Freelancers Nationwide

Photo Credit: Phil Roeder

House Republicans Introduce Commitment to American GROWTH Act

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Posted by Clara Diaz on Monday, October 19th, 2020, 1:46 PM PERMALINK

House Minority Leader Rep. Kevin McCarthy (R-Calif.) and Ways and Means Ranking Member Rep. Kevin Brady (R-Texas) have released H.R. 11, “The Commitment to American Growth, Renewal, and Opportunities for Workers, Technology, and Health” (GROWTH) Act.   

This legislation contains targeted tax cuts that will help the American economy rebound as the pandemic runs its course. 

This effort from House Republicans draws a sharp contrast to Democrat nominee Joe Biden’s plan to impose at least $4 trillion in new or higher taxes including income tax increases, business tax increases, and capital gains tax increases. As part of this proposal, Biden has called for repealing the Tax Cuts and Jobs Act (TCJA), which will increase taxes on Americans at every income level.  

The Commitment to American GROWTH Act will benefit workers, families, and small businesses with further tax cuts that will foster innovation, encourage research and development, and secure America’s medical supplies through four main provisions: 

Strengthening Pro-Growth Tax Cuts to Boost Jobs and Wages 

First, the bill locks in key provisions from the Trump Tax Cuts that support American jobs and paychecks.  This legislation would make full business expensing permanent, as well as the business interest limitation of earnings before interest, taxes, depreciation, and amortization (EBITDA). 

Full business expensing reduces taxes by allowing businesses to deduct the cost of new investments (machinery, equipment etc.) in the year they are made, which incentivizes growth, increases productivity, creates jobs, and raises wages. This also simplifies the tax code by equalizing the tax treatment of new investments with other business expenses such as wages, rent, and healthcare costs.

In a post COVID-19 world, expensing will help businesses make vital investments as they seek to bring workers back, onshore manufacturing capabilities, and ramp up production. Making these provisions permanent will incentivize long-term investments by providing business certainty. 

Supporting and Strengthening American Innovation 

This bill also encourages investment in research and development (R&D) so American businesses can continue to make, buy, and sell American made products.  

Much like full business expensing of new investments, full R&D expensing creates an incentive to increase capital investment, which leads to stronger economic growth, more jobs, and higher wages. The bill proposes doubling the R&D tax credit, which will encourage more American investment and economic growth.  The R&D credit is a general business tax credit companies that incur research and development (R&D) costs in the United States.

Jobs tied to R&D are quality, high paying jobs. In 2017, the average wage for R&D related jobs was $134,978 – 2.4 times higher than the average wage, according to the Bureau of Labor Statistics. Doubling the R&D tax credit will help create more of these quality jobs. 

Incentivizing research will make America a more attractive place to grow a business, and it supports high-paying jobs in production and applied research, ultimately, a higher standard of living for all Americans. 

Encouraging investments in advanced medical manufacturing  

In addition, to strengthening R&D, the bill contains targeted reforms to strengthen American medical development so that our country is not overly reliant on China.

Startup businesses seeking to develop a cure usually have no revenue; therefore, they see no benefit from R&D credits. This provision fixes this aspect, but also provides additional liquidity to startups so they can continue their research. This credit is to be monetized in order to help pre-revenue medical research companies – such as small biotech firms on the frontlines of cures research. In addition, it encourages outside investment in infectious disease drug development firms by allowing any losses to offset other income.  

Investments in advanced manufacturing will help the United States regain its status as a global leader in manufacturing. Growth in America’s medical independence will help retain and create high paying jobs, support domestic innovation, and enhance national security—especially from China—and increase public health. 

Providing liquidity for businesses as they seek to develop cures 

This bill encourages growth and innovation in technology breakthroughs by incentivizing outside investment in startup medical research firms.  

By giving additional tax benefits to investors in certain infectious disease drug development firms, this will help induce investment in medical research startups. This bill will allow America’s innovators to create new companies, such as ones that are working on cures to deadly and rare diseases.  H.R. 11 will allow research startups that change ownership to utilize net operating loss carrybacks which will give startup businesses an additional source of liquidity.  

Growth in innovation and technology breakthroughs gives American innovators a leg up as they work on research and development of new technological findings. 

The best path to rebuilding the economy is pro-growth policies, not tax hikes and intrusive regulations. The Commitment to American GROWTH Act contains a number of targeted provisions that will help the economy recover, policies that draw a sharp distinction to the tax hikes that Democrats support. 

Photo Credit: Brook Ward