Tax Reform

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True Tax Reform to Benefit the American Worker

America has generally advantaged the asset holder at the expense of the wage earner for most of my lifetime. The scale has been rigged for far too long. For over a decade, Warren Buffet has opined repeatedly that he is the lowest marginal taxpayer in his organization. Even this attempt to demonstrate the absurdity of how our tax code fosters wealth disparity has fallen on deaf ears with policy makers of both parties. In the United States, the bottom half of Americans has captured just 3 percent of growth since 1980.

End Preferred Status of Real Capital Gain and Dividends

Profits taxed and dividends are taxed at a reduced rate relative to labor, increasing inequality, and making the tax system regressive in nature. The current policy exacerbates growth of existing capital and wealth over labor and promotes increasing levels of inequality. We should tax dividends and real capital gains as ordinary income.

Raise the Corporate Income Tax Rate to 25%

On January 1st 2018, the corporate tax rate will be a flat 21 percent. While the prior rate was sub-optimally high, there is no compelling economic reason to drop the rate beneath 25 percent. The 400 billion dollars of additional revenue from this single adjustment would be more than enough to fund many projects to promote opportunity and economic growth for all of America.

Bring Common Sense to Estate Tax Reform

I would reduce the exempted amount to 2 million. Further, I would fight for end of stepped up basis, which allows for inherited appreciated assets to be exempt from taxation entirely. This gigantic accounting loophole that benefits only the wealthiest heirs in America allows the vast majority of inherited capital wealth appreciation in many cases to escape taxation entirely. The existing policy puts rocket fuel into the growth of ever-increasing levels of inequality. The first two million tax free should be enough for any heir. Above that point, such earnings should be subject to taxation.

Financial Transaction Tax

A Financial Transaction Tax is a simple, efficient, and progressive revenue source. Given the gutting of the treasury by the recent GOP tax cuts, revenue increases are now to ensure crucial public investment in America’s future.

End Carried Interest Loophole

Despite many loud promises from President Trump to be rid of it, the Republican tax plan keeps the carried-interest loophole that grossly benefits managers of hedge funds and private equity funds at the expense of every other American. Carried interest is a money manager’s share of the fund’s profit. It is taxed at the lower capital gains tax rate, while profit in other professions is taxed at the higher ordinary income rate. Until we normalize capital gains and wage income, this artificial tax break meant to enormously benefit a very few high income earners should end.

In Congress, I will fully support Rep. Sandy Levin’s H.R. 2295 – The Carried Interest Fairness Act.

End CEO Bonus Loophole

In 1993, Congress enacted reforms to ensure that large corporations couldn’t avoid paying taxes by paying out massive salaries to their executives by placing a $1 million cap on the deductibility of executive compensation. Unfortunately, a loophole was included in that legislation that exempts deductions for executive bonuses. This loophole allows CEOs to abuse compensation packages while boosting profits of the richest corporations, particularly on Wall Street. For example, former Wells Fargo CEO John Stumpf was one of the most significant beneficiaries of the CEO bonus loophole in 2014, even as he was overseeing a massive rip off of the bank’s customers through their fraudulent account scheme. He earned fully deductible bonuses and stock options worth over $40 million, which translates into a $14 million tax break for Wells Fargo.

This is unacceptable. In Congress, I will fully support Rep. Lloyd Doggett’s H.R. 399 – The Stop Subsidizing Multimillion Dollar Corporate Bonuses Act.

Allow Deduction of Student Loan Interest

Currently, taxpayers with a modified adjusted gross income of less than $80,000 ($165,000 if married filing jointly) can deduct a maximum of to $2,500 of student loan interest from their taxes, per year.

Carbon Pricing & Reinvestment

I support a gradually increasing fee on carbon dioxide emissions, along the lines proposed by the Brookings Institute. This fee should be implemented at the first point of entry of fossil fuels into the economy, i.e., the mine, well, or port. Consistently, studies have shown that a carbon tax is the most efficient and effective way to reduce carbon emissions.