Tax reform is a priority agenda item in the 115th Congressional session. In the coming months, we will hear significant proposed changes to the extremely complex income tax laws. One of the hotly debated provisions will be what to do with the corporate tax rate. The current rate of 35% is the highest in the industrialized world. When you add the corporate amount charged by most states the total in near 40%. The average rate levied by other industrialized countries is about 23%. This is a huge disadvantage for American businesses in the global economy. It is driving American corporations and their profits offshore to avoid such a heavy tax burden.
Arecent headline for a Homer News letter to the editor caught my attention — “National sales tax wrong for Alaska.” The author was Mike Wenstrup, chair, Alaska Democratic Party. His purpose was to counter Mead Treadwell’s endorsement of a national sales tax which is known as the FairTax. To be expected, Mr. Wenstrup ignored some very important truths.
You may have noticed there’s a scandal surrounding the Internal Revenue Service. The IRS has acknowledged the targeting of conservative groups applying for IRS Code 501(c) status. This strikes at the heart of the freedom guaranteed by the First Amendment. Regardless of political leanings, certainly we can agree that the
misuse of such a powerful and feared bureaucracy is unacceptable. To paraphrase Shakespeare: Something is rotten on the Potomac.