Federal Tax Policy

Feb 8, 2016

Top 400 Taxpayers See Tax Rates Rise, But There’s More to the Story

As Americans were gathering party supplies to greet the New Year, the Internal Revenue Service released their annual report of cumulative tax data reported on the 400 tax r...

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Feb 4, 2016

Chlorine Bleach Plants Needlessly Endanger 63 Million Americans

Chlorine bleach plants across the U.S. put millions of Americans in danger of a chlorine gas release, a substance so toxic it has been used as a chemical weapon. Greenpeace’s new repo...

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Jan 25, 2016

U.S. Industrial Facilities Reported Fewer Toxic Releases in 2014

The Toxics Release Inventory (TRI) data for 2014 is now available. The good news: total toxic releases by reporting facilities decreased by nearly six percent from 2013 levels. Howe...

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Jan 22, 2016

Methane Causes Climate Change. Here's How the President Plans to Cut Emissions by 40-45 Percent.

UPDATE (Jan. 22, 2016): Today, the Bureau of Land Management (BLM) released its proposed rule to reduce methane emissions...

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Overtime Amendments Stripped Out in Conference

Oct 6, 2004 by Guest Blogger

Today, House and Senate conferees engaged in final meetings to complete work on the massive corporate tax bill. In doing so they defeated a Democratic amendment on overtime rules that had been passed by a Senate committee. The amendment, sponsored by Senator Tom Harkin , proposed to restore overtime rights while preserving an inflation adjustment to the minimum salary that determines automatic overtime eligibility. The amendment would have banned the Department of Labor from enforcing new overtime pay rules.

Its passage in committee was considered a huge victory for labor rights, and showed that many Congressmen were willing to stand up against the administration's new overtime proposals.

Unfortunately, as has happened in the past, conferees blocked the Senate amendment today. The amendment had been attached to the tax bill. Senator Harkin expressed frustration that his amendment has been approved six times by both chambers, but has always been stripped out in conference.

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The Numbers on FSC/ETI

Oct 6, 2004 by Guest Blogger

Yesterday, the Joint Committee on Taxation released an updated score on the "chairman's mark" of the FSC/ETI bill. (See http://www.house.gov/jct/x-68-04r.pdf.)

Overall, the score raises $238 million in revenue, although there are several gimmicks which are used to keep the costs down (see http://www.cbpp.org/10-4-04tax.htm.)

The repeal of the exclusion of ETI will cost $57.7 billion.
Under title VIII, there are revenue provisions to close loopholes and raise some fees, which raise a total of $81.7 billion

The revenue enhancements from the repeal of the ETI regime and the loophole closings thus total $139.4 billion. (Note that this total would come close to paying for the $146 billion price tag of the "middle class" tax cut.)

Rather than using this money to finance cuts in other areas of the tax code or pay off the debt, the bill gives over $139 billion in additional tax cuts primarily to businesses.

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Congress Spends $146 Billion To Extend Certain Tax Cuts Without Offsets

Congress voted to extend so-called "middle-class" tax reductions last week, and chose not to offset any of the cost of the $146 billion measure. In addition, the bill also includes $13 billion in tax cuts for businesses. When factoring in the additional interest costs, the bill will increase the deficit by over $200 billion.

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Large Corporations May Receive More Tax Breaks

The House and Senate continue to move forward on a substantial corporate tax bill. The Foreign Sales Corporation and Extraterritorial Income Exclusion (FSC/ETI) bill is designed to remove certain corporate tax subsidies that were ruled illegal by the World Trade Organization. Repealing the subsidies would increase federal revenue by approximately $50 billion over the next 10 years. (The bill is currently in conference. See a summary of the differences between the House and Senate version.)

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Long-term Fiscal Situation - USA Today Style

Oct 4, 2004 by Guest Blogger

USA Today lays out some of the longer-term numbers on the nation's fiscal health, and what needs to be done to bring the system into long-term balance.

$84,454 is the average household's personal debt. $473,456 is the average household's share of government debt, including Medicare and Social Security. The government isn't asking you to pay it. Yet.

By Dennis Cauchon and John Waggoner USA TODAY

The long-term economic health of the United States is threatened by $53 trillion in government debts and liabilities that start to come due in four years when baby boomers begin to retire.

The “Greatest Generation” and its baby-boom children have promised themselves benefits unprecedented in size and scope. Many leading economists say that even the world's most prosperous economy cannot fulfill these promises without a crushing increase in taxes — and perhaps not even then.

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Congress Votes to Extend Bush's Tax Cuts

Sep 27, 2004 by Guest Blogger

The House and Senate voted overwhelmingly on the evening of September 23 to extend three tax cuts amounting to $146 billion total, with $13 billion set aside for a variety of business tax breaks. Because the costs of the tax cuts are not offset at all, many believe that they will end up hurting the middle class in the long run.

The Center on Budget and Policy Priorities released a report highlighting how the "middle class" tax cuts will likely end up making the middle class net losers, once the cost of paying for the tax cuts is considered. The report can be read here.

The legisltation, which was passed 92-3 in the Senate and 339-65 in the House, extends the $1,000 per-child tax credit and tax breaks for married couples, and prevents the 10 percent income tax bracket from being applied to smaller amounts of earned income. The legislation also extends alternative minimum tax relief for one year.

Click here to read a Washington Post article with further details on the new tax legislation.

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CTJ and ITEP Release Important New Report

Sep 23, 2004 by Guest Blogger

On September 22nd, Citizens for Tax Justice and the Institute on Taxation and Economic Policy released an important report highlighting the taxes paid - or not paid - by many of the county's largest companies.

The report can be downloaded here .

BUSH POLICIES DRIVE SURGE IN CORPORATE TAX FREELOADING

Eighty two of America's largest and most profitable corporations paid no federal income tax in at least one year during the first three years of the George W. Bush administration. This is one of the many troubling findings of this major new report on corporate tax avoidance.

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Deficit Hits All-time High, Many Corporations Don't Pay Fair Share

Washington, DC, Sept. 22, 2004--The result of recent tax policy choices is that the 2004 deficit has reached an all-time high of $422 billion dollars. The Congressional Budget Office reported this month that only 11% of the FY 2004 deficit was due to cyclical factors, while 89% of the deficit was result of federal policy decisions. Not only is the current deficit the highest it has ever been in dollar terms, but in a recent analysis, OMB Watch Staff Economist John Irons projected that the deficit will reach $5.5 trillion over the next ten years. In addition, a new study released today by the Institute on Taxation and Economic Policy (ITEP) finds that many of the country’s biggest corporations are not paying their fair share of federal income taxes.

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Economy and Jobs Watch: Cyclically Adjusted Deficit Reaches Record High

The cyclically adjusted deficit -- that is, the deficit adjusted to remove economic fluctuations -- reached an all-time high of $374 billion in 2004 according to a new report by the Congressional Budget Office. As a share of the overall economy, the cyclically adjusted deficit at 3.2 percent of GDP is at its highest levels since the early 1990's -- and has been exceeded in only 7 of the last 42 years (see chart below.)

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Beyond the Baseline: 10 Year Deficits Likely to Reach $5.5 Trillion

Deficits not "cut in half" in 5 years.

The Congressional Budget Office's (CBO) September 2004 "The Budget and Economic Outlook: An Update" shows a baseline projection of a $422 billion deficit for 2004, and $348 billion for 2005. The 10-year baseline projections show a $2.3 trillion deficit over the next ten years; however, as the report notes, the baseline is not intended to be a good predictor of actual budgetary outcomes. A better predictor of budget deficits under "current policy" would put the deficit for 2005 at $405 billion and the 10-year deficit over $5.5 trillion.

With the increase in retirees necessitating increased Social Security and Medicare expenditures, the situation is not projected to improve after 2014 either, unless, of course, the direction of current policy is significantly changed. The CBO's report demonstrates that freezing discretionary spending will not solve the deficit problem; and that not extending the Bush tax cuts helps more, but also won't completely solve the longer term problem.

As the CBO put it "[e]ven if the economy grows more rapidly than projected, significant long-term strains on the budget will start to intensify within the next decade as the baby-boom generation begins to reach retirement age." Download full report (.pdf)

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