House Republicans call for overhaul of tax code in 2013

[alp227]

Source: washington post

As part of a year-end budget deal, House Republicans are urging adoption of “fast-track procedures” to force lawmakers to complete a sweeping overhaul of the U.S. tax code in 2013.

House Ways and Means Committee chairman Dave Camp (R-Mich.) said Thursday that he has two goals with respect to the tax code: “One, block massive, job-killing tax increases” at the end of the year, when the George W. Bush-era tax cuts are set to expire. “And two, enact — not just pass — comprehensive tax reform.”

“There is strong support to use the expiration of the (Bush tax cuts) as leverage to force action in 2013 on comprehensive tax reform,” Camp told the Federal Policy Group’s annual tax seminar. “How? Simple: In addition to extending current low-tax policies originally enacted in 2001 and 2003, we should enact fast-track procedures to compel comprehensive tax reform next year.”

Camp said he is mulling what form those procedures might take. He and House Speaker John A. Boehner (R-Ohio), who endorsed the idea this week, made comparisons to the process by which lawmakers adopt trade agreements negotiated with other nations. Under that system, Congress has 90 days to reject or approve a pact in its entirety without amendment.

Read more: http://www.washingtonpost.com/business/economy/house-republicans-call-for-overhaul-of-tax-code-in-2013/2012/05/17/gIQApRPBXU_story.html

[Drunken Irishman]

1. Start with overhauling the Bush tax cuts.

[WCGreen]

2. They expire next year....

So they have to not act to get the tax rates to go up...

[sofa king]

14. ...Hence the sudden urge to actually do something...

...for the first time in three and a half years.

[msongs]

3. obama already renewed the bush cuts once, so..... nt

[TrollBuster9090]

9. He didn't renew them for nothing, though. He got quite a lot in exchange.

Repeal of DADT and extension of unemployment benefits.

I thought it was pretty poignant to see how quickly the Republicans threw the social conservatives under the bus with DADT in exchange for continued tax cuts for their billionaire masters. It showed WHO they were really loyal to and who they just paid lip service to. I was sure the social conservatives would be pissed about that, but Republicans were gambling that the social conservatives would be too stupid to realize what happened, and too dumb to remember it two years later. And they were RIGHT.

[DallasNE]

4. How Does That Work

We had an agreement as part of debt extension to do many of these things but the Republicans broke that promise. It would be extremely unwise to strike any kind of deal kicking the can down the road until 2013 because Republicans cannot be trusted to keep their end of the bargin. I view this proposal as dead on arrival.

[ProgressiveProfessor]

5. Actually a massive overhaul is needed...but I don't think what the Repukes have in mind qualifies

[Sherman A1]

6. Indeed

We need to go back to the overhaul that happened when St. Ronnie took over and start from there.

[ProgressiveProfessor]

15. Further than that...

The tax code in the US is massive, as is the tax avoidance industry. A radically simpler code would throw those parasite out of work and it would be a good thing. Not advocating the fraud that Forbes is pushing but a markedly simpler progressive tax system.

Many forget that most deductions and loopholes were put in there by well meaning people to encourage one kind of behavior or another. Over time it has gotten out of control. If we do a massive cleanup, it will also allow for much less in the way of tax dodging as we see today.

[pinboy3niner]

7. The prospect of Republicans rewriting the tax code is the stuff of nightmares

Nothing good can come of that. The GOP's tax policy favors the priviliged wealthy and screws the poor and the middle class (or at least, what's left of it). The goal of their 'ownership society' is that they own us.

[Cosmocat]

18. F U C K I N G F R I G H T E N I N G

the thought of tax reform with them even in the room, much less driving it ...

[TrollBuster9090]

8. Kabuki theatre aside, we all know what's going to happen in January 2013.

The lame duck Congress is going to enact some version of Simpson-Bowles before the new Congress takes over. If the new tax code has already been written, and they dump it on the floor the day after the election, it might give them just enough time to pass it using this method before the new Congress takes over. It would have to be simplified in order to be written and passed so quickly. Probably only two or three flat tax brackets with very few deductions or loopholes.

We've now entered an age of faux hyperpartisanism where government can only do things during lame duck sessions between November and February, right after elections. And the only Congressmen that will compromise or show any common sense will be the ones who were just defeated.

[AlbertCat]

19. hyperpartisanism where government can only do things during lame duck sessions

This is only true of Repugs.

Nancy got a lot done.

Dems do not have a goal of making the president fail.

[Lawlbringer]

10. How are the tax increases job killing?

I know they say that it takes money away from those who would have used that money to pay wages....but come on. We've been sitting on those same tax CUTS for a decade and we've seen a REDUCTION in jobs. So, it's crazy to reason with a crazy person, but even the GOP should see that. Their puppetmasters, of course, won't, since they're the ones who'd have to pay the "job killing" taxes.

[sulphurdunn]

11. Ya see, if you tax the "job creators"

with "job killing" tax increases, you'll hurt their feelings and reduce their "incentive" to let their entrepreneurial genius "trickle down" like little pieces of manna from Heaven here rather than in China. Is that clear?

[tclambert]

12. Taxes on "job creators" just be "job killing" because . . .

ooh, look at the monkey. Look at the silly monkey. If Chewbacca lives on Endor, you must acquit! The defense rests.

[tclambert]

13. Seriously,

(sorry about the Chewbacca thing.) Republicans seem to believe that personnel managers make hiring decisions based on the size of their CEOs' tax refunds, and write checks on their CEOs' personal checking accounts to pay for new hires so the new hires can sit around and do nothing. More middle class customers with good-paying jobs creating opportunities for real business expansion--that has nothing to do with the decision to hire more employees. It's all about whether or not the boss got a tax cut.

(That may not sound serious, yet sadly it is.)

[dmallind]

17. It's even more basic than that

Salaries and hiring costs are 100% tax deductible from the smallest S corp through Exxon Mobil. Businesses are taxed on profits. Profits (gross) are revenue minus direct costs, which includes burdened labor. Profits (net) further minus indirect costs, which includes ancilliary business expenses like hiring costs.

The amount of taxes levied on net profits is immaterial to hiring and always will be, since net profits are what is left after all job-creation and job-sustaining is paid for.

[dmallind]

16. I agree with them

Not, I assume, on the final product, but on the need for an overhaul. Tax codes are insanely complex. While I recognize the benefit of subsidies for desired behavior, their nature and quantity, as well as the underlying structure, could be massively simplified. My basic framework would be something like this (in full knowledge that it woulld never pass):

Personal:
All income regardless of source be it pay, gains, small business profits, inheritance, etc is included at these rates, as is any company-paid benefit beyond salary and health etc (till we get a NHS), to forestall the obvious dodge of low pay but company-paid lavish lifestyle.

20k is tax free
Up to 50k 10%
Up to 100k 20%
Uo to 250k 30%
Up to 1MM 40%
Above 50%

Subsidies at a reasonable maximum (half?) are available for doing a small range of things deemed in the public good but which would be otherwise financially unattractive like alternative energy or truly small business startup

How many kids you have, where you live or if you marry is your call alone.

Corporate:
The GREATER of:
1% of revenue
5% of gross profits
20% of net profits
50% of US-derived net profits if the US is your largest customer market AND you are registered as a Non-US company

Subsidies, again limited, available for in-country hiring as a percentage of salaries paid, in arrears or for new facilities which will increase payrolls (can be in advance, but adjusted back out on future returns if hiring not demonstrated). Pure R/D grants as tax breaks also available for given parameters of research.