Lynn Jenkins on Tax Reform

Strong believer in the economic power of lower taxes

Our economy will flourish when taxes are low. In Congress, I will vote to make the 2001 and 2003 tax cuts permanent, including elimination of the Marriage Penalty Tax.

Repeal the Death Tax.

A BILL to repeal the Federal estate and gift taxes:
• Subtitle B of the Internal Revenue Code of 1986 (relating to estate, gift, and generation-skipping taxes) is hereby repealed.
• The repeal shall apply to estates of decedents dying, gifts made, and generation-skipping transfers made after the date of the enactment of this Act.

Replace income tax & employment tax with FairTax.

• Repeals the income tax, employment tax, and estate and gift tax.
• Imposes a national sales tax on the use or consumption in the United States of taxable property or services.
• Sets the sales tax rate at 23% in 2011, with adjustments to the rate in subsequent years.
• Allows exemptions from the tax for property or services purchased for business, export, or investment purposes, and for state government functions.
• Prohibits the funding of the Internal Revenue Service (IRS) after FY2013.
• Establishes in the Department of the Treasury: (1) an Excise Tax Bureau to administer excise taxes not administered by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF); and (2) a Sales Tax Bureau to administer the national sales tax.
• Terminates the sales tax imposed by this Act if the Sixteenth Amendment to the U.S. Constitution (authorizing an income tax) is not repealed within seven years after the enactment of this Act.

Taxpayer Protection Pledge: no new taxes.

Politicians often run for office saying they won't raise taxes, but then quickly turn their backs on the taxpayer. The idea of the Pledge is simple enough: Make them put their no-new-taxes rhetoric in writing.

In the Taxpayer Protection Pledge, candidates and incumbents solemnly bind themselves to oppose any and all tax increases. While ATR has the role of promoting and monitoring the Pledge, the Taxpayer Protection Pledge is actually made to a candidate's constituents, who are entitled to know where candidates stand before sending them to the capitol. Since the Pledge is a prerequisite for many voters, it is considered binding as long as an individual holds the office for which he or she signed the Pledge.

Since its rollout with the endorsement of President Reagan in 1986, the pledge has become de rigeur for Republicans seeking office, and is a necessity for Democrats running in Republican districts.

No European-style VAT (value-added tax).

RESOLUTION Opposing the imposition of a value-added tax:
• Whereas a value-added tax (VAT) is a type of sales tax that is assessed on goods at every stage of production;
• Whereas a VAT is a hidden tax that is ultimately passed along to consumers, but is embedded into the price of goods and services and therefore not transparent to the consumer;
• Whereas the average tax burden levied by the Federal Government since 1980 has been 18% of GDP;
• Whereas, within the next 15 years, Federal taxes are projected to rise to the highest level in US history;
• Whereas adding a VAT on top of the existing Federal income tax would increase the burden on United States taxpayers to unprecedented levels;
• Whereas the average VAT rate in Europe has risen from 5% when the tax was first introduced in the 1960s to 20% today;
• Whereas European countries that have imposed a VAT have seen their total tax burden rise to an average of over 40% of GDP;
• Whereas such high levels of taxation and spending crowd out private investment, which stifles economic growth and leads to chronically high levels of unemployment;
• Whereas the IRS has calculated that US taxpayers spend approximately $200 billion and 7.6 billion hours a year to comply with Federal tax laws;
• Whereas a VAT would only add another layer of complexity and compliance costs to a fundamentally unsound tax system;
• Whereas the burden of a VAT would fall most heavily on low-income and middle-class Americans; and
• Whereas a VAT would do nothing to restore fiscal accountability in Washington, but would simply bankroll wasteful and inefficient Federal Government spending:
• Now, therefore, be it Resolved, That--
• It is the sense of the House of Representatives that imposing a value-added tax would be a massive tax increase that would cripple families on fixed income and only further push back the US economic recovery; and
• the House of Representatives opposes a value-added tax.

Member of House Ways and Means Committee.

The Committee of Ways and Means is the chief tax-writing committee of the United States House of Representatives. Members of the Ways and Means Committee cannot serve on any other House Committees, though they can apply for a waiver from their party's congressional leadership. The Committee has jurisdiction over all taxation, tariffs and other revenue-raising measures, as well as a number of other programs including:

• Social Security
• Unemployment benefits
• Medicare
• Enforcement of child support laws
• Temporary Assistance for Needy Families, a federal welfare program
• Foster care and adoption programs

Supports the Taxpayer Protection Pledge.

[The ATR, Americans for Tax Reform, run by conservative lobbyist Grover Norquist, ask legislators to sign the Taxpayer Protection Pledge in each election cycle. Their self-description:]

In the Taxpayer Protection Pledge, candidates and incumbents solemnly bind themselves to oppose any and all tax increases. Since its rollout in 1986, the pledge has become de rigeur for Republicans seeking office, and is a necessity for Democrats running in Republican districts. Today the Taxpayer Protection Pledge is offered to every candidate for state office and to all incumbents. More than 1,100 state officeholders, from state representative to governor, have signed the Pledge.

The Taxpayer Protection Pledge: "I pledge to the taxpayers of my district and to the American people that I will: ONE, oppose any and all efforts to increase the marginal income tax rate for individuals and business; and TWO, oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates."

Opponents' Opinion (from wikipedia.com):In Nov. 2011, Sen. Harry Reid (D-NV) claimed that Congressional Republicans "are being led like puppets by Grover Norquist. They're giving speeches that we should compromise on our deficit, but never do they compromise on Grover Norquist. He is their leader." Since Norquist's pledge binds signatories to opposing deficit reduction agreements that include any element of increased tax revenue, some Republican deficit hawks now retired from office have stated that Norquist has become an obstacle to deficit reduction. Former Republican Senator Alan Simpson, co-chairman of the National Commission on Fiscal Responsibility and Reform, has been particularly critical, describing Norquist's position as "no taxes, under any situation, even if your country goes to hell."

Replace income tax and IRS with FairTax.

Congressional Summary: This bill imposes a national sales tax in lieu of the current income and corporate income tax, employment taxes, and estate and gift taxes. The rate of the sales tax will be 23% in 2017, with adjustments in subsequent years. U.S. residents receive a monthly sales tax rebate (Family Consumption Allowance) based upon family size and poverty guidelines. No funding is allowed for the operations of the Internal Revenue Service after FY2019. Finally, the FairTax terminates if the 16th Amendment to the Constitution (authorizing an income tax) is not repealed within 7 years.

Supporters reasons for voting YEA: Rep. MORAN: I am all on board on tax reform, but the best solution is not tinkering with the current system; it is an overhaul of the current Tax Code. The FairTax, in my view, brings two goals front and center: to pass on to the next generation of Americans the freedoms and liberties guaranteed by our Constitution, and the opportunity for every American to live the American dream.

Opponents reasons for voting NAY: (by FairTaxWarrior.com):

• Criticisms from The Left
  • The FairTax rate is really 30%, not the 23% proponents say.
  • It's an additional national sales tax.
  • It's really just a windfall tax cut for the rich.
  • A sales tax is regressive, and punishes the poor unfairly.
  • It's just a scheme to let corporations escape paying taxes.
• Criticisms from The Right:
  • The FairTax does nothing to cut government spending.
  • The 23% rate is too high.
  • It 's the largest welfare increase in history [via the Family Consumption Allowance]
• General criticisms
  • The FairTax will negatively impact the housing market [by removing the mortgage deduction].
  • Black market activity will increase.
  • The IRS won't really be abolished.
  • The Flat (Income) Tax is a better option.
  • It will be a nightmare to transition to The FairTax from an Income Tax.