@RepDaveCamp to release draft to @FixOurTaxCode Feb. 26. Will it include a switch from CBT to RBT? http://t.co/CG3PnREEZu
— U.S. Citizen Abroad (@USCitizenAbroad) February 26, 2014
Thanks to @ShadowRaider for providing this update.
Here is the text of the bulletin.
Every year Americans spend more than six billion hours and $168 billion to file their returns.
There have been so many changes to the tax code over the past decade that it is now 10 times the size of the Bible, but with none of the Good News. That factual statement usually gets a good laugh back home in Michigan. What isn’t funny is the effect that constant tinkering with taxes has had on the people who pay them, and on the economy.
According to Nina Olsen, the National Taxpayer Advocate at the IRS, Americans overall spend over six billion hours and $168 billion every year to file their returns. This is stark testimony to the complexity of the tax code. Meanwhile, owners of small businesses face tax rates as high as 44.6%, while the total (state and federal) U.S. corporate rate, 39.1%, is the highest in the industrialized world.The last time the U.S. enacted a comprehensive tax reform was 1986. But many of America’s major competitors have been actively reforming their tax laws in recent years. Even our closest neighbors are getting ahead of us. Canada has already reformed its tax laws and Mexico is doing so right now. If Congress doesn’t take action, the U.S. risks falling further behind.
The tax code should make it easier for American companies to bring back profits earned overseas so they can be invested here. It should not hinder small businesses from growing into large businesses. And the individual income tax needs to be simpler, fairer and flatter for everyone.
On Wednesday, I am releasing what a simpler, fairer tax code actually looks like. The guiding principle is that everyone should play by the same rules—your tax rate should be determined by what’s fair, not by who you know in Washington. Here is what it would look like:
First, the tax code will be made simpler—so every family can do its own taxes confidently, without fearing an audit, or wondering if someone else who can afford an expensive accountant is getting a better deal.
Today there are 15 different tax breaks for education—nine for current expenses, two for past expenses and four for future expenses. The IRS instructions explaining it all come to almost 90 pages. That isn’t a tax code designed for working families; it is a tax code designed to make money for accountants.
Last year, my Democratic counterpart on the Ways and Means Committee, Sandy Levin of Michigan, and I created 11 bipartisan working groups to tackle different parts of the tax code. One of those, headed by Diane Black (R., Tenn.) and Danny Davis (D., Ill.), looked into those education provisions. After months of work, the leaders of the working group recently came forward with a plan that consolidates four of these provisions into one improved credit, making it easier for families and students to afford a college education.
Paired with more commonsense reforms like increasing the standard deduction and the child tax credit will mean that nearly 95% of the country can get the lowest possible tax rate by just filing the basic IRS 1040A form—no more itemizing, no more keeping track of all those receipts, and no more filling out all those extra schedules, forms and work sheets.
Second, the tax code will be made more effective and efficient by getting rid of special-interest handouts, which will mean lower tax rates for individuals, families and all businesses. Under this plan, over 99% of tax filers will face a top tax rate of 25%—allowing small and large businesses alike to expand operations, hire new workers and increase benefits and take home pay. On the individual side, there will be an introductory bracket of 10%.
Nonpartisan, independent economists at the congressional Joint Committee on Taxation have already analyzed this plan. According to those estimates, after this streamlining of the tax code, the size of the economy will increase by $3.4 trillion over the next decade, or roughly 20% compared with today. This will lead to nearly two million new jobs—and producing up to $700 billion in additional federal revenues that can be used to lower taxes even further or reduce the debt.
What does this mean for you and your family? Because we will have a healthier economy, wages will rise. With more income but lower tax rates, families with a median income ($51,000 for a family of four) will have on average an extra $1,300 in their pocket at the end of the year.
Third, make the tax code fairer and more accountable. That means no more hidden provisions that benefit a favored few, and no more tax increases to fuel more spending.
We can clean up provisions like “carried interest” that allow certain private-equity firms to get the investment-income tax rate on what anyone else would call normal wage income. We’ll also put an end to special depreciation benefits related to corporate jets and close, once and for all, the infamous “John Edwards” loophole that allows a select few to avoid employment taxes on their income. The revenue gained from that provision, and many others like shifting to Roth-style retirement accounts for those contributing more than $8,750 (only 5% of the workforce) can be used to lower tax rates across the board.
The tax code changes in my plan are not intended as a means of raising revenue. If loopholes are closed, Americans should get the benefit by way of lower rates.
Tax reform needs to be about strengthening the economy and making the code simpler and fairer. That’s what Republican President Ronald Reagan did when he worked with Democrats in Congress in 1986. We need to get to work and repeat that success.
@Petros fair enough with the discription of “extremist or inflammatory ” view points.
i think what this site has done in reguards to not censoring or blocking comments has been nothing short of stellar!!!
i think more than anything i was just expressing my frustration (?) at yet again reading a more “fringe” type post that really does not do much more than give the opposition one more reason to lable this website as extremist or inflammatory. it gets a little old after a while…..
great quotes by frodo and gandolf….very true….
and then there is this one as well
“Somebody has to do something, and it’s just incredibly pathetic that it has to be us.”
while there may be truths
*labeled many times as extremist and inflammatory*
We all have opinions… right or wrong… If we don’t meekly obey without fight then we are called troublemakers… zealots… or whatever names they can come up with. This web site allows all to express their opinions, what they have done… their experiences… their take on a subject. To me that is very important because as u know… every one of us will have a different situation that can’t be tailored with… do x… y… z… then u are all done. Without info, we can’t figure it out. Even now, I haven’t figured it out. If we don’t take a stand or put out the info so others are aware, who will… our gov’t who are suppose to rep & protect us? Who ever thought that regular citizens… resident or not.. are now *second class* in the world with the US taint. Once all that info is sent to that big database.. can u really say… we will have any privacy? We are recorded & stored without real knowledge of what is being done for our good… so when the info is stolen or mis-used… how are we suppose to protect ourselves.. no one will help us
@US_Person_Foreigner yes i totaly agree with your above statement. i think seeking information is why many of us arrived at this website and we have taken that information we have learned and gone forth and educated more people who come to this website and they to then go out and educate more people. which is a good thing and i don’t belive for one minute we are zelots for coming here and doing what we are doing.
we are all pasionate people about this cause because it effects each and everyone of us…abet in slightly different ways…all i was trying to say was by making these “extremist and inflammatory” posts or comments only makes it seem like we are “extremists” here and not the everyday people who only want to live our lives the way we have been doing.
@monalisa. Hammer hitting nail on head.
@monalisa1776 …your comment ” I….. was just pointing out my paranoia.” Well I think your concerns are valid …..as we both live in Poodle Central……. at least in Poodle Central we get some benefits for our taxes………….also remember
““Just because you’re paranoid doesn’t mean they aren’t after you” ― Joseph Heller, Catch-22
Mr Heller also said “Some men are born mediocre, some men achieve mediocrity, and some men have mediocrity thrust upon them.” …..I’m going to spend some very pleasurable moments working out where some well known FATCAnatics fall into the above 3 categories!!!
@Petros and all the IBS movers and shakers…-thank you for wise words and the tolerance at IBS for all the venting that is allowed. as you say… Petros …. you hit the bell…… most of what we describe about USGov is actually true…. and you could almost not make it up….
I guess one has to remember as well that some of the extravagant phrasing that occurs is sheer relief at “FINALLY SOMEONE GETS IT”….when you burst a boil, there is an initial spurt of foul matter…… ewwwww TMI TMI!! also many many folks on this site have been through the PTSD creating machine of giving up the blue paper which they were born with and again the sense of joy at meeting kindred may overspill into some of the phrasing.
the BARD said it all approx 400 years ago Henry VI, Part 3. , “To whom do lions cast their gentle looks? Not to the beast that would usurp their den. The smallest worm will turn being trodden on, And doves will peck in safeguard of their brood.”
Lions of Isaac brock -I salute you. we are changing the world one action at a time , one person helped to navigate the CBT maze with information at a time, one story at a time shared with STEM people that would make someone think twice, thrice and more about moving them and their family to USA , one family member educated at a time , one colleague in a multinational aware of the issue at a time, [I held a little “freedom celebration” at work upon my renunciation ], one FOI request at a ttime, one “solve theproblem” information meeting at a time…… ……….
in the end all we can do is be true to our Taxpatriot ideals which are 1776 spirit and ascribe to the Lorenz theory and imagine each effort we make as one flap of the butterfly’s wings…….
Dingle, Levin and Levin join Lenin in the dustbin of history.
Good Riddance to them all.
The Boot-Strap Expat
“@Petros, I’m all for free speech but was just pointing out my paranoia.”
Ok, so you’re telling me that Kazakhstan is NOT the best country in the world? I can accept that but the other comments comparing the USA govt to the German regime in the ’30s all I can say is the minute I stop, someone else will start. I’m not the first and won’t be the last. The reason this WILL happen is because the truth always comes out and as time goes on the whole world will denounce the National Socialists in Washington. This is the natural progression and nothing will stop it.
HISTORY repeats for some sadistic reason and we are at the beginning of the worst tribulation the world has yet seen.
This pretty well says it all
That was not supposed to be aimed at Petros. I’m lost in the thread somehow. Anyway the person who said they were just expressing their paranoia will read it anyway, sorry
I think that it is great that this website allows quite open debate on FATCA. FATCA is a very complicated matter. I just think that we are already so riled that more heat isn’t necessarily helpful.
I would agree that civil liberties and privacy are generally under serious threat. One front page story here today is a Snowden revelation that the NSA helped the UK to capture pictures from random webcam users in the UK on Yahoo! and the authorities did not delete the explicit ones (apparently not everyone uses the internet to discuss taxes)! Hitler and Stalin are a bit of stretch, but thanks to Snowden, we are finding out that the post 9/11 word has brought us far closer to East German Secret Police levels of monitoring than we could have imagined.
@CBE, I have referenced that song many times during this current debacle in reference to all this data gathering frenzy and FATCA.
@Chearsbigears, I take as a given that we’re shifting into an Orwellian world and not just in the US!! I’m thinking more in terms of how we can do what we can to save ourselves rather than expecting governments to change; it’s naive to blindly believe that the US government is going to completely follow the Constitution. Why anger the bear by poking at it??
As to the Senate Finance Committee, there is a staff discussion on International Business Taxation on its website. Almost at the end is this:
“The staff discussion draft does not address the international tax rules addressing individuals, whether for U.S. citizens living overseas or foreign nationals moving to the United States. The Chairman’s staff is considering reforms to simplify the rules in this area while appropriately taxing such individuals. Comments are requested regarding the scope and mechanics of reforms in this area.”
So at least it is on the agenda and there is the opportunity to comment.
Here’s but one of the submissions, UK71: http://isaacbrocksociety.ca/2014/01/27/todays-must-read-us-senate-finance-committee-submission-by-john-richardson-willard-yates-stephen-kish/
Here’s another: http://citizenshipsolutions.ca/2014/02/06/pfic-taxation-and-americans-abroad/.
Let’s hope there’s hope with this excellent material before the Senate Finance Committee — Richardson and Kish!
Let’s hope so!!
Did the ACA letter of submission to the Senators Carl Levin and John McCain Inquisition on offshore Evasion get published anywhere on Isaac Brock? I have not been keeping, up, and if it has been mentioned, and I missed it, I apologize for the duplication..
Pretty darn good, if the old fools in charge would read it!!!
@Just Me, I’ve read that and agree it covers the issues well.