The chairman of the House Ways and Means Committee released a new plan to overhaul the tax code today.
The chairman of Congress’s chief tax-writing committee released a plan Wednesday for a sweeping overhaul of the tax code that would close tax loopholes and drop the top tax rate from 35% to 25% for all but the very wealthiest taxpayers.
The plan, which has met with tepid response from Democrats and Republicans on Capitol Hill, would be the biggest tax overhaul since 1986.
The current seven tax brackets would be collapsed into just three brackets of 10%, 25% and 35%. But 99% of households — those making less than $450,000 — would pay no more than the 25% rate.
The standard deduction would be increased from $12,200 to $22,000 for married couples filing jointly, allowing 95% of taxpayers to get the largest reduction without having to itemize.
But there are trade-offs: The $3,900 personal exemption for each dependent would be eliminated. Taxpayers would no longer be allowed to deduct state and local taxes. And only the first $500,000 of mortgage interest would be deductible.
And what did the ‘leader’ of the House Republicans have to say about this plan?
House Speaker John Boehner, R-Ohio, said the plan was a way to start a discussion about tax reform, but when asked about the details, he responded, “Blah, blah, blah, blah.”
I swear, Boehner is a 13-year-old girl. But I digress. And I apologize to the 13-year-old girls for the comparison. They’re much more mature than the current Speaker of the House.
The reports out of D.C. are that this bill is DOA, and it should be.
“Any proposal that eliminates the deduction for state and local taxes, as the Republican plan would do, is dead on arrival,” said Sen. Chuck Schumer, D-N.Y.
Should Republicans choose to embrace the plan, they could use it to highlight their efforts to simplify tax laws and spur economic growth. Democrats surely would rely on it to point out cherished tax breaks that would be cut.
This plan is Exhibit A for all that is wrong in our nation’s capital: Demolicans and Republicrats playing politics while America burns. But don’t give up hope. There is a way to satisfy both Republicans and Democrats. There is a way to simplify the Internal Revenue Code, spur economic growth, and get rid of those ‘unfair’ tax breaks all in one shot.
Repeal the 16th Amendment.
Git ‘er done, boys!!!