Tags Posts tagged with "Tax Reform"

Tax Reform

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Paul Ryan
If they can't even deliver tax reform - what exactly are they here for?

With the GOP failing to score a solid win on healthcare, Republicans now seem to be under increasing pressure to deliver a win on taxes for their party and the White House before the midterm elections.

Being two of the GOP’s top priorities at the beginning of the year, there were high expectations for success on ObamaCare repeal and tax reform, considering the fact that the party is in control of the House, Senate, and the White House.

With the Senate failing to pass the GOP’s healthcare legislation, the stakes seem to be even higher for the party on tax reform.

Tax reform is “now increasingly important to the economy, and increasingly important to Republicans’ political prospects in the future,” said Grover Norquist, President of the Americans for Tax Reform.

According to Norquist, GOP lawmakers, especially those up for reelection, need to deliver “spectacular” tax reforms, given the setback they received on healthcare.

He further explained that the GOP had made promises about how an Obamacare repeal and replace would boost economic growth, showing the true value of a Republican government. Hence, the GOP tax reform needs to give an even better upsurge to the economy.

On Tuesday, prominent Republicans also emphasized on the importance of tax reform that would augment economic growth.

“Important for Senate GOP to stay at table. #obamacare is collapsing. Regardless we are moving forward on bold #taxreform this year,” Kevin Brady (R-Texas) House Ways and Means Committee Chairman and the man in charge of the tax reform bill in the House, posted on Twitter on Tuesday.

Orrin Hatch (R-Utah) Senate Finance Committee Chairman, expressed concerns that the healthcare debacle could take up a lot of time lawmakers have for a tax reform effort. However, he said that he’s going to press the matter and push ahead.

“It’s always going to be difficult to do both,” Hatch said. “There’s nothing easy around here, and especially with the close numbers that we have.”

On the other hand, some are of the belief that the latest setback on healthcare could actually motivate lawmakers to get a win on taxes.

“I think probably it will make people even more determined to get tax reform,” Rep. Tom Cole (R-Okla.) said.

Former Finance Committee aide, Dean Zerbe, said he’s expecting a “more fervent effort” from the Republicans on tax reforms, following their failure on healthcare.

“People are going to be focused because they need a win on the board,” he said.

According to experts, a comprehensive tax reform bill will be very tough to draft if healthcare legislation isn’t ready.

For Congressional Republicans, it was important to get done and over with healthcare before they moved on to tax reform because they wanted to repeal certain ObamaCare taxes. Hence, if lawmakers plan on repealing any of the ObamaCare taxes as part of a tax reform, they’ll need to come up with something to pay for those tax cuts.

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Tax Plan
Make Taxes Great Again?

On Wednesday, representatives from the automobile industry met with National Economic Council Director Gary and raised their concerns in regards to the Republicans’ proposal for border-adjustment tax.

President of the American International Automobile Dealers Association, Cody Lusk stated, “America’s international nameplate dealers fully support federal tax reform but remain deeply opposed to the [border-adjustment tax] provision, which would drive up the cost of every vehicle on their lots by an average of $2,000 per vehicle.”

“We were grateful to have an opportunity to share our perspective with the White House, and we are optimistic that a well-crafted tax reform bill, minus the BAT, can make its way through Congress and to the president’s desk for his signature,” he added.

The administration had been actively meeting with groups from the auto industry, ever since they released their tax plan, back in April.

“Today’s meeting with stakeholders from the automobile industry is another step towards delivering comprehensive tax reform for the American people,” Cohn stated. “The White House continues to hear from business leaders across all industries that the tax and regulatory climate in this country makes it increasingly difficult to be competitive. The president and this administration remain committed to creating a tax system that will spur economic growth and bring jobs back to America,” he added.

The White House is yet to mention as to whether they shall be considering to include the border-adjustment tax in their tax bill. The border adjustment proposal that imposed a tax on imports while, exempting exports, was a part of the tax plan that was released by the House Republicans last year. While, its supporters would argue that it encourages companies to bring jobs back into the United States, it is still up for debate as to whether it can result in higher prices of goods.

John, Bozzella, CEO and president of Association of Global Automakers expressed his concerns by stating, “To grow our highly innovative and globally competitive auto industry, it is imperative that the BAT not be part of any tax reform proposal.”

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Tax Reform
Is your paycheck about to get a boost?

According to the latest report from the Tax Foundation, the House Republican tax reform plan proposed by Speaker Paul Ryan (R., Wis) could potentially create 1.7 million jobs and increase after-tax incomes by 8.7 percent on average.

The plan proposes to lower marginal tax rates on wages, investments, and business income. Additionally, it simplifies the tax code so it could fit on a small postcard. The tax reforms would also the corporate tax rate to 20 percent while broadening the tax base, and further eliminate federal gift and estate taxes.

“There are a lot of reasons to support the GOP plan,” Speaker Ryan said. “It will level the playing field for American businesses, simplify the tax code to make it flatter and more fair, and usher in a new era of economic growth in our country.”

“Ultimately, this is about making sure you can find good-paying jobs and keep more of your hard-earned paychecks,” he said. “The moment to fix our broken tax code is now.”

The Tax Foundation analyzed the GOP proposal, also being called “A Better Way,” to determine the state-by-state impact on income and jobs.

On a national scale, the analysis calculated that the plan would create at least 1,687,000 full-time jobs and raise the after-tax income of median households by $4,917 on average. The increase in jobs and income will mostly be due to the reform’s ability to escalate productivity and economic growth.

“Our analysis found that the plan would significantly reduce the cost of capital and reduce the marginal tax rate on labor,” the report states. “These changes in the incentives to work and invest would greatly increase the U.S. economy’s size in the long run, boost wages, and result in more full-time equivalent jobs.”

The analysis found that after the implementation of the new plan, California would have at least 191,767 new full-time jobs, Washington DC would have 9,154 new jobs, Texas would see the creation of 140,734 jobs and New York will have 109,733 jobs.

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