VAT

Norquist Accepts Obama Fiscal Commission Co-Chair Alan Simpson's Invitation to Testify


Posted by John Kartch on Friday, June 11th, 2010, 1:18 PM PERMALINK

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Former U.S. Senator Alan Simpson, the co-chairman of President Obama’s fiscal reform commission, has invited Americans for Tax Reform president Grover Norquist to appear before the commission during its public hearing on the afternoon of June 30.  As reported in National Journal, Simpson said:

"We're notifying everybody in America, if you want to come in, don't come in to bitch. Come in and tell us what you would do to get where we are trying to get. We're going to sit here from 1 (p.m.), grab a sandwich, and go until midnight.I want to particularly ask Grover Norquist, what is it you want to do? Other than just raise money and get members, what have you got in mind to help America proceed, other than say anybody that talks about raising taxes will be cremated and crucified on a stake?"

Norquist accepts the invitation and has submitted application details per the Commission’s website, www.FiscalCommission.gov.

The Commission is formally known as the National Commission on Fiscal Responsibility and Reform, and will conclude its work no later than December 1.  Simpson serves as co-chairman along with Erskine Bowles, Chief of Staff to President Bill Clinton.  Bruce Reed, Chief Domestic Policy Adviser to President Clinton, serves as Executive Director.

The full list of Commissioners is as follows:


Sen. Max Baucus (D-Mont.)

Rep. Xavier Becerra (D-Calif.)

Rep. Dave Camp (R-Mich.)

Sen. Tom Coburn (R-Okla.)

Sen. Kent Conrad (D-N.D.)

David Cote, Chairman and CEO, Honeywell International

Sen. Mike Crapo (R-Idaho)

Sen. Richard Durbin (D-Ill.)

Ann Fudge, Former CEO, Young & Rubicam Brands

Sen. Judd Gregg (R-N.H.)

Rep. Jeb Hensarling (R-Texas)

Alice Rivlin, Senior Fellow, Brookings Institute and former Director, Office of Management & Budget

Rep. Paul Ryan (R-Wis.)

Rep. Jan Schakowsky (D-Ill.)

Rep. John Spratt (D-S.C.)

Andrew Stern, former President, Service Employees International Union

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Daily Media Spotlight May 28, 2010


Posted by Aaron Marcus on Friday, May 28th, 2010, 1:36 PM PERMALINK

In an op-ed for Investor’s Business Daily, Grover along with Rep. Wally Herger (R-Calif.) called for the VAT to be taken off the table ASAP.  Many in Washington believe the solution to this problem is to raise taxes. Certainly, we must confront the national debt with urgency, but a cycle of higher spending and higher taxes would be a double assault on our future economic prosperity.

John McKinnon of The Wall Street Journal wrote an article about how Congress is contemplating a pension bailout, and how the Alliance for Worker Freedom is trying to stop it. “Using taxpayer funds to pay for private pensions would be a first” for the federal government.”

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Peter Orszag: Obama's "firm pledge" on taxes is just a "preference" or "stance"


Posted by John Kartch on Friday, May 14th, 2010, 1:57 PM PERMALINK

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On April 27, President Obama issued a warning to anyone thinking about asking him about his “firm pledge” not to raise any form of taxes on those making less than $250,000:  if you ask about his pledge, you are playing “an old Washington game”.

Facing questions about Obama’s “firm pledge” on Wednesday, White House Budget Director Peter Orszag followed the example of his boss by characterizing questions about tax hikes on the middle class as a “game” and described Obama’s tax pledge as merely a “preference” or a “stance”.

Compare Obama’s original promise to Orszag’s comments:

“I can make a firm pledge.  Under my plan, no family making less than $250,000 a year will see any form of tax increase.  Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”– Candidate Barack Obama [Transcript] [Video]

“The president has been very clear about what he prefers.  That was his stance during the campaign, and he still believes that’s the right course forward. But he has also been very clear that we shall let the commission go do its work.” – Peter Orszag

Last year, White House spokesman Robert Gibbs said the pledge “didn’t come with caveats.” 

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Americans for Tax Reform and the Anti-VAT Caucus


Posted by Amir Iljazi on Friday, April 30th, 2010, 11:20 AM PERMALINK

With talk becoming ever more increasing on the issue of a Value-Added Tax (aka, VAT); Americans for Tax Reform has joined with members of the House and Senate to revive the Anti-Vat Caucus, which is solely based on the goal of ensuring that American taxpayers are not burdened with yet another draconian measure to impose taxes. The implications for such a tax would be devastating to an economy that is struggling and to working families all across the country. The Anti-VAT Caucus will fight against any such form of taxation that would not only break the President's pledge made in New Hampshire that "No family making less than $250,000 a year will see any form of tax increase,” but would further stifle the growth of the economy in a time where jobs, spending, and taxes are on the top of the voters’ lists.

There is so much information about the VAT to be considered, but here are some of the major points, courtesy ATR’s Tax Policy Analyst Ryan Ellis:

  • VATs  don’t displace other taxes.  In fact, the evidence from Europe shows that other taxes rise as VATs rise.  The reason is that more VAT revenue begets more government spending, which creates demand for yet more tax revenue.  According to Dan Mitchell of the Cato Institute (who gets his data from the OECD), in 1967 the U.S. and Europe each collected about $0.27 in taxes for every $1.00 produced.  The U.S. is still collecting that much, but Europe’s tax burden has shot up from 27% to over 40%
  • Other taxes rose in Europe as the VAT grew.  Personal income taxes grew from 7 percent to 11 percent of Europe’s GDP.  Corporate income taxes grew from 2 percent to 3.5 percent of GDP.  Taxes on income and profits grew from 9 percent to 14 percent of Europe’s economy.  As the VAT grew, so did all the other taxes.
  • Americans for Tax Reform Foundation has estimated that if the United States adopted a European-style VAT tax base, every 1 percent point in VAT rate would yield the tax revenue equivalent of 0.4 percent of GDP (or about $50 billion per year).  Even a 1 percent VAT with a European base would be as big as the net tax hike under Obamacare.

ATR has now begun to ask candidates to join the Anti-Vat Caucus, if elected. The follow candidates have already made the promise to join:

In addition to these candidates, more than 60 federal elected officials have signed onto the Anti-VAT caucus, you can see the complete list here.

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Obama: Asking About My Tax Pledge is a "Washington Game"


Posted by John Kartch on Tuesday, April 27th, 2010, 11:25 AM PERMALINK

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Consider yourself warned:  Americans should not ask President Obama about his “firm pledge” not to raise any form of taxes on families making less than $250,000.  Anyone asking such a question is just playing a “Washington game”. 

So says President Obama, anyway.  In his remarks introducing the debt commission today, Obama said the following:

PRESIDENT OBAMA:  It’s important that we not restrict the review or the recommendations that this commission comes up with in any way.  Everything has to be on the table.  And I just met briefly with the commission and said the same thing to them.  Of course this means that all of you, our friends in the media, will ask me and others once a week, or once a day, about what we are willing to rule out or rule in when it comes to the recommendations of the commission.  That’s an old Washington game…so I wanted to deliver this message today: we’re not playing that game.  I’m not gonna say what’s in, I’m not gonna say what’s out.

Obama’s “everything has to be on the table” mantra directly contradicts his central campaign promise that no family making less than $250,000 will see any form of tax increase. 

Obama’s refusal today to rule out tax hikes on families making less than $250,000 per year may explainhis recent attempts to alter the terms of his central campaign promise.  Twice this month, Obama has claimed his middle class tax pledge only applied to “income taxes” rather than “any form of taxes”. 

In his April 10 Weekly Radio Address, Obama said:

“And one thing we have not done is raise income taxes on families making less than $250,000.  That’s another promise we’ve kept.”

In a speech on the evening of April 15, Obama repeated the truncated promise:

“And one thing we haven’t done is raise income taxes on families making less than $250,000 a year -- another promise that we kept.”

The two recent statements stand in stark contrast to Obama’s original promise:

“I can make a firm pledge.  Under my plan, no family making less than $250,000 a year will see any form of tax increase.  Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”(Dover, NH)  [Transcript] [Video]

Last year, White House spokesman Robert Gibbs said the pledge “didn’t come with caveats.”

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Debt Commission Co-Chair Alan Simpson's Anti-Taxpayer Voting Record


Posted by Ryan Ellis on Monday, April 26th, 2010, 5:12 PM PERMALINK

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Responding to criticism from taxpayer advocates in an interview today with Neil Cavuto, former Sen. Alan Simpson (R-Wyo.), co-chairman of President Obama’s debt commission, claimed he had “the best record as a non-taxer in the US Senate”.  Simpson’s actual voting history indicates otherwise.  Below are several of the most important tax votes Simpson took as a Senator:

Bush “Read My Lips” Tax Hike (10/27/1990, RC # 326): Simpson voted to raise the individual top marginal income tax rate from 28 to 31 percent, to phase out itemized deductions like charitable contributions, to raise Medicare payroll taxes,  and to increase excise taxes on alcohol and tobacco.  This violated President Bush’s “read my lips” pledge.  $2 in spending cuts were promised for every $1 in tax hikes.  None—zero—of the spending cuts were enacted.  All of the tax hikes were.

Medicare Catastrophic Coverage Bill(06/08/1988, RC # 590): Simpson voted for a new Medicare catastrophic cost and prescription drug bill which was paid for in part by charging seniors a surtax of 15% of their annual income tax liability.  This is a marginal income tax hike.  This law (which Simpson also voted to repeal) led to the famous incident where House Ways and Means Committee Chairman Dan Rostenkowski (D-Ill.) had has car pounded on by seniors with their umbrellas.

Tax Reform Act of 1986(09/27/1986, RC #677): Simpson shockingly voted against the Tax Reform Act of 1986, which was the most significant tax reform of the last century.  It lowered the top personal income tax rate from 50 percent to 28 percent.  It lowered the corporate income tax rate from 46 percent to 34 percent.  While there were elements that were unpalatable (e.g., the hike in the capital gains tax rate from 20 to 28 percent, the limits on IRA contributions, etc.), the package was the final nail in the coffin of the high tax-rate era.

Social Security Tax Hikes of 1983(03/24/1983, RC #54): Simpson voted for the biggest tax hike in Social Security’s history in 1983.  Faced with bankruptcy, the Alan Greenspan commission chose not to reform Social Security into a defined contribution system with personal accounts.  Rather, they re-used the old formula of benefit cuts and tax increases.  In this case, the payroll tax rate was increased from 10.8 percent to 12.4 percent.  It also exposed up to half of Social Security benefits to income taxation.

TEFRA Act of 1982(08/19/1982, RC #834): Simpson voted in favor of this bill which was a lie liberal Democrats in Congress foisted upon President Reagan and the American people.  The Congressional Democrat leadership promised $3 in spending cuts for every $1 in tax hikes.  The tax hikes happened—arguably, little to none of the spending cuts did.

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Obama to debt commission: Feel free to break my tax pledge


Posted by John Kartch on Monday, April 26th, 2010, 12:59 PM PERMALINK

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During his campaign, President Obama made a “firm pledge” not to raise “any form” of taxes on families making less than $250,000 per year.  White House spokesman Robert Gibbs has said the pledge “didn’t come with caveats.”  

Yet President Obama told the leaders of his debt commission that “everything is on the table”.

In an interview on Fox News Sunday, debt commission co-chairman Erskine Bowles had the following exchange with host Chris Wallace:

CHRIS WALLACE, ANCHOR:  Mr. Bowles, Barack Obama — I don't have to tell you — campaigned in 2008 for president on a flat pledge that he would not raise any taxes — not income taxes, not any taxes — on people making less than $250,000 a year. Do you feel bound by the president's pledge?

ERSKINE BOWLES, DEBT COMMISSION CO-CHAIRMAN:What I feel bound by is the president looked Senator Simpson and me in the eye and he said, everything is on the table.

Bowles also refused to rule out a Value-Added Tax.  The Bowles statements may explain Obama’s recent attempts to alter the terms of his central campaign promise.  Twice this month, Obama has claimed his middle class tax pledge only applied to “income taxes” rather than “any form of taxes”. 

In his April 10 Weekly Radio Address, Obama said:

“And one thing we have not done is raise income taxes on families making less than $250,000.  That’s another promise we’ve kept.”

In a speech on the evening of April 15, Obama repeated the truncated promise:

“And one thing we haven’t done is raise income taxes on families making less than $250,000 a year -- another promise that we kept.”

The two recent statements stand in stark contrast to Obama’s original promise:

“I can make a firm pledge.  Under my plan, no family making less than $250,000 a year will see any form of tax increase.  Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”(Dover, NH)  [Transcript] [Video]
 

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President on taxes: I had hoped to invest in your future..without asking more of you..but I can't


Posted by John Kartch on Thursday, April 22nd, 2010, 4:41 PM PERMALINK

“I had hoped to invest in your future by creating jobs, expanding education, reforming healthcare and reducing the debt without asking more of you. And I’ve worked harder than I’ve ever worked in my life to meet that goal. But I can’t, because the deficit has increased so much, beyond my earlier estimates and beyond even the worst official government estimates from last year.”

-- President Bill Clinton, Feb. 15, 1993 [Video clip]
  
“I believe that we should be able to make sure that we don’t burden middle class families further. Having said that, I am also going to wait for the fiscal commission to provide me what their best recommendations are.”
                
-- President Barack Obama, April 21, 2010 [Video clip

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Obama floats a VAT: <br> Admission explains attempt to alter tax pledge


Posted by John Kartch on Wednesday, April 21st, 2010, 8:07 PM PERMALINK

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President Obama made it official today : He is open to the imposition of a Value-Added Tax (VAT) on the American people. A VAT would violate Obama’s central campaign promise – a “firm pledge” that no family making less than $250,000 per year would see “any form of tax increase”.
 

Obama’s admission came during an interview with CNBC’s John Harwood. Asked if he could see the potential for a VAT, the President said:
 
"I know that there's been a lot of talk around town lately about the value-added tax. That is something that has worked for some countries. It's something that would be novel for the United States. And before, you know, I start saying 'this makes sense or that makes sense,' I want to get a better picture of what our options are.”

Obama’s VAT admission may explain his recent attempts to alter the terms of his central campaign promise. Twice in the past two weeks, Obama has claimed his middle class tax pledge only applied to income taxes rather than “any form of taxes”. 
 
In his April 10 Weekly Radio Address, Obama said:
 
“And one thing we have not done is raise income taxes on families making less than $250,000.  That’s another promise we’ve kept.”
 
In a speech on the evening of April 15, Obama repeated the truncated promise:
 
“And one thing we haven’t done is raise income taxes on families making less than $250,000 a year -- another promise that we kept.”
 
The two recent statements stand in stark contrast to Obama’s original promise:
 
“I can make a firm pledge.  Under my plan, no family making less than $250,000 a year will see any form of tax increase.  Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.” (Dover, NH) [Transcript] [Video]
 
The Obama VAT admission also comes the day after White House economic advisor Austan Goolsbee refused six consecutive opportunities to permanently close the door on a VAT and two days after White House spokesman Robert Gibbs said a VAT “is not something the President has proposed nor is it under consideration.”

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