Bush May Delay Tax Reform Push
Sent to us by reader JP Merrihew:
Tax reform push may be delayed
Sources say recommended initiatives may be too controversial to push in an election year.
December 4, 2005: 6:29 PM ESTWASHINGTON (Reuters) - The White House may delay unveiling a broad proposal to overhaul the tax code until 2007 or later, despite earlier discussions of making it a major theme for next year, people close to the White House said.
A panel named by President Bush has recommended sweeping changes to the tax code, including reducing deductions for home mortgages and state and local taxes.
Bush is having the Treasury Department review the recommendations and submit a plan to him.
The White House had initially considered having Treasury prepare a plan by the end of the year that could form the basis for a proposal in Bush’s State of the Union address.
But several Republicans with close administration ties said it now seems likely Bush may only speak generally about tax reform in the address and not unveil specifics.
“I don’t think there is enough time to churn out a policy,” said one Republican, who spoke on condition of anonymity.
Time Magazine, in its latest edition, quoted a White House official as expressing doubt that a major proposal to change the tax code could attract Democratic support in a mid-term election year.
“No one wants to put something out there that’s not going to go anywhere,” the magazine cited a White House official as saying.
The Republican source who spoke to Reuters noted that several elements of the tax panel’s recommendations, most notably the proposed cut in the home mortgage deduction, are controversial and making major revisions to the commission’s report might take a great deal of time.
The position at Treasury that would normally serve as a clearinghouse for such efforts — the assistant Treasury secretary for tax policy — has been vacant for several months. “There is not the manpower to do it,” the source said.
Fewer tax brackets
In addition to curbing deductions like those for home mortgages, the commission also proposed limits on the tax-preferred status of employer-provided health insurance.
The commission also recommended reducing the number of tax brackets and eliminating the alternative minimum tax, a parallel tax system that increasingly hits middle-class taxpayers.
A second Republican who spoke to Reuters on condition of anonymity said the White House was not “at loggerheads” with the commission over its findings but there is a belief that an election year was not the best time to sell the public on such a detailed initiative.
“The complexity would turn people off,” the source said.
Many Republicans are wary of embracing a controversial and complex initiative after Bush’s drive to overhaul Social Security proved unpopular.
In an opinion piece published in the Washington Post just days after the tax report was released, Rep. Tom DeLay of Texas pointed to a “minefield of serious political trouble” in some aspects of the report, such as the home-mortgage proposal.
Treasury Secretary John Snow had said in late October that he hoped to present his findings on tax changes to Bush by the end of the year but the administration more recently has been noncommittal on the timing of the tax initiative.
“The timing is unclear,” White House economic adviser Al Hubbard told reporters Friday. “In terms of priorities for next year, that’s up — I’m going to leave it up to him to share his priorities with the American people.”
While commending the tax panel’s work as “excellent,” Hubbard added, “That’s not to say we’re signing off on what their proposals are.”
There’s only one thing I want to hear Bush say about the tax “reform” panel. I want to hear him say that they’ve failed, and he’s starting from scratch.
Indeed, wipe the slate clean. Unless it’s a drastic simplification, it will be undone within a decade anyway.
Aug 10,2004 (AFP) - US President George W. Bush said Tuesday that the United States ought to “explore seriously” a proposal to replace income taxes with a national sales tax.
“It’s kind of an interesting idea that we ought to explore seriously,” Bush said in response to a question from a supporter at a town-hall style campaign rally here.
I found this on the Fairtax website and I agree with Brad that the tax pannel failed and also agree with President Bush that a national sales tax, particularly the Fairtax since it is so well researched, should be seriously explored.
The Fair Tax HR 25/S 25 deserves a hard look and Congresspeople or Senators who look at it deserve support.
Let me just state that if President Bush is in favor of FairTax and point out that a lot of what Bush has done has be wrong that I conclude that FairTax is probably not the answer.
Well... the tax reform or not...... the little people like us will always pay and pay and pay... we must be aware that the rules and law are created to protect big players, like multinational companies with lot of money and power.....