Rachael Slobodien - June 20th, 2017
“A border adjustment tax is a ball and chain that is dragging down real, pro-growth tax reform.”
Washington, DC – Today, ahead of Speaker Paul Ryan’s (R-WI) speech at the National Association of Manufacturers, Club for Growth President David McIntosh offered the following statement outlining factors that make for pro-growth tax reform. In his statement, McIntosh also encourages Republicans to resist implementing a border adjustment tax as part of any tax reform proposal.
“Roughly one year ago this week, House Speaker Ryan unveiled the House Republicans’ blueprint to overhaul the tax code,” Club for Growth President David McIntosh stated. “In an attempt to craft pro-growth tax reform, the blueprint called for lower tax rates and a territorial tax system for international corporations.”
“But, here we are a year later, and Congress has made little progress towards cutting taxes – even though voters overwhelmingly sent Republicans to Washington with a clear mandate to reduce taxes.
“The biggest impediment to pro-growth tax reform is the Border Adjustment Tax (BAT). It is a political loser. The BAT has become a ball and chain that is dragging down real, pro-growth tax reform. The Republican Senate has made it clear that the BAT is a nonstarter. President Trump’s proposal also wisely sidesteps the issue entirely – choosing correctly to focus on pro-growth tax cuts, rather than middle class tax increases, which would be the inevitable consequence of a BAT.
“Any member who campaigned on lowering taxes should not even entertain the idea of a BAT. However, Speaker Ryan and a few members of Congress, like Ways and Means Chairman Kevin Brady (R-TX), continue to push the idea of a border adjustment tax. Their unwillingness to abandon the proposal now threatens to doom the best prospects Republicans have to pass meaningful tax reform.
“No matter how Rep. Brady and others may try to sell it—like with a five-year transition period—a BAT will effectively be a $5 trillion tax hike on American consumers. Those in favor of a BAT try to rationalize it by arguing it is necessary to lower tax rates on corporations. Club for Growth flatly rejects Speaker Ryan’s green eyeshade notion that in order to pass pro-growth tax cuts, Republicans have to raise taxes. The BAT would do so at the expense of hardworking American families struggling to make ends meet. Republicans in Congress should not support it.
“Since its inception, Club for Growth has fought to enact tax reform to lessen the tax burden on American families and businesses and in so doing, unleash economic growth. Just last week, Club for Growth and Americans for Tax Reform made the case for lasting tax reforms by extending the budget window beyond ten years. And that’s one of many pro-growth approaches to tax reform, but the border adjustment tax is not.”
David McIntosh - June 20th, 2017
To: Interested Parties
From: David McIntosh, President. Club for Growth
Date: June 19, 2017
Recent polling demonstrates that Republicans can turn the healthcare debate around and win by going on offense.
The numbers show two things:
1. General election voters will vote against incumbent Senate Democrats who continue to support Obamacare; and
2. If Republicans fail to repeal Obamacare, Republican and independent voters will not support Republicans.
No wonder why Chuck Schumer has gone all out to stop Obamacare repeal and make it look like a Republican failure. Sadly, so far Senate Republicans have played into his hand by being on defense. It’s clearly a losing strategy to call attention to how much of Obamacare Republicans plan to keep in place— like most of the taxes, increased spending, and costly regulations to name only a few. Instead, Republicans should be reminding voters why they rejected the seriously flawed Obamacare legislation in the first place.
Republicans can turn the debate around and once again make repealing Obamacare a winning issue for them. The key is focusing on how harmful Obamacare is for Americans and how Republican free-market principles will improve health insurance across the board. Here is how to do it:
- REMIND VOTERS JUST HOW BAD OBAMACARE IS: Instead of debating pre-existing conditions – the House bill still requires that they be covered – talk about the mandates Obamacare imposes. Remind Americans of the broken promises, starting with “If you like your plan, you can keep it.”
The debate must be about making health insurance affordable for millions of American families. Under Obamacare, young people cannot afford health insurance. They are required to either pay exorbitant amounts for coverage or if they forgo coverage, they are punished by having to pay higher taxes. Obamacare mandates also are forcing many small businesses to cut back on the number of employees they can hire.
- POLLING SHOWS VOTERS STILL HATE OBAMACARE: In two recent Club for Growth surveys, nearly 60 percent of all general election voters in both West Virginia and Montana said they are “less likely” or “much less likely” to vote for incumbent Democratic Senators who support Obamacare. Among solely independent voters in Montana and West Virginia, the percentage of independent voters who said they are “less likely” or “much less likely” to vote for incumbent Democratic Senators who support Obamacare remains close to 60 percent.
For example, the question asked Montana voters whether the following information would affect their vote:
Jon Tester supported Obama’s healthcare bill with its higher taxes, mandatory funding for abortions, and higher insurance premiums, costing Montana taxpayers millions of dollars on a failed government program that has increased insurance premiums in Montana by forty-four percent.
These results show that Republicans can win the Obamacare repeal debate when they remind voters of its many flaws.
- DEMOCRATS LOSE GROUND WHEN THEY ARE FORCED TO DEFEND OBAMACARE: The surveys also show that Democrats pay a price at the polls for blocking Republican efforts to repeal and replace Obamacare with a system that will make health insurance more affordable. Over 50 percent of all general election voters in both West Virginia and Montana – Democrats, Republicans, and independents – say they are “much less likely” or “less likely” to vote for the incumbent Democratic Senator if he or she opposes the effort to repeal Obamacare. Among independent voters, roughly 45 percent in West Virginia and 50 percent in Montana say they are “much less likely” or “less likely” to vote for the incumbent Democratic Senator if he or she opposes the effort to repeal Obamacare.
For example, the question asked Montana voters whether the following information would affect their vote:
Jon Tester continues to defend Obamacare even though he admitted there were “plenty of mistakes with the Affordable Care Act,” and 4.7 million Americans have had their private insurance cancelled by Obamacare.
- VOTERS REJECT REPUBLICANS FAILURE TO ACT: Other surveys show that Republican Senators and Representatives who are up for reelection in 2018 will also pay a price – thus endangering their majority in both chambers – if they do not repeal Obamacare. Ten percent of likely Republican voters say they will not reelect Republicans if they don’t fully repeal Obamacare.
THE POLITICAL CONSEQUENCES
What’s crystal clear is that with majorities in both houses of Congress as well as a Republican in the White House, Republicans will have no excuses if they fail to repeal Obamacare. Even more sobering for Republicans should be the data that shows a whopping 50 percent of independent voters will not vote for Republicans if Obamacare remains the law of the land.
Now we know why Chuck Schumer and the Democrats are fighting so hard to block repeal. They will continue to pound the table and seek to put Republicans on defense about issues that have already been taken care of (Read the House bill, it retains the Obamacare protection for pre-existing conditions).
The last thing that the liberals want is to be forced to defend the failure that is Obamacare. Republicans will win if they can successfully shift the debate. Republicans need to be on offense and demonstrate how repealing Obamacare and its mandates will make health insurance more affordable for all Americans. Democrats are betting on Republicans in the Senate losing their resolve, and walking away from the repeal effort. If Republicans don’t change course and go on offense, it’s increasingly likely that Democrats will win in 2018.
REPUBLICANS MUST GET ON OFFENSE TO REPEAL OBAMACARE
But it’s not too late. Congressional Republicans still can—and should—control their own destiny.
- Make the bill all about helping the millions of Americans who lost their health insurance and are having to pay ever-skyrocketing deductibles and premiums if they want to keep their health insurance.
- Talk about how the bill repeals the mandates and tax increases that have crushed small businesses and eliminates the exemption for Congress from Obamacare.
- Stay away from wonk-ish debates about CBO numbers and imaginary losses of healthcare – we all know Americans will continue to receive excellent healthcare.
- Show how the Republican bill will bring down health insurance premiums – if you can’t show this, have you really repealed Obamacare?
- Most of all show that Republicans are working for the American people and will keep their promises after they have been elected.
Stacy French - June 14th, 2017
“The budget window has traditionally been a decade.
But the Senate could make it 25 years.”
Club for Growth President David McIntosh and Americans for Tax Reform President Grover Norquist penned an opinion editorial in The Wall Street Journal making the case for extending the budget window to 25 years or more.
“Americans know what kind of tax reform they want: a bill that cuts rates across the board, kills the death tax and the alternative minimum tax, expands the personal and family exemptions, and eliminates politically directed loopholes. If lawmakers passed such a plan it would supercharge the economy and create millions of jobs.
The challenge is how to get from here to there, given the rules of Congress.
Tax reform can be enacted with a simple majority in the Senate under the process known as budget reconciliation… [A]ny tax reform meant to spur economic growth should be permanent so that businesses and entrepreneurs can plan ahead. If they don’t know what the rules will be a few years down the road it is tougher to build factories, hire new workers, invest in equipment, or spend on research and development.
Conventional wisdom says that the only way to pass lasting tax cuts is to offset them with corresponding tax increases, base broadening or, best of all, permanent spending cuts.
There’s another option: Extend the budget window to 25 years—or more. The 10-year window is not set in stone. The Budget Act of 1974 simply says that the window has to be at least five years in duration.
The idea of modifying the time frame isn’t new, and it certainly isn’t radical. The budget window was expanded in 1995 from five years to seven, and then in 1999 to 10 years, where it has remained for no particularly good reason.
We say extend the budget window to 25 years. Why? Because the people creating jobs and investing in new products think long-term. Depreciation schedules for new plant and equipment often run to 25 years or more.
Lawmakers simply should write this year’s budget to say that all tax cuts can last 25 years, which would allow rate reductions to go into effect now and be offset later with revenue from higher growth or spending restraint.”
“… As President Trump says, “prime the pump” now and the economy will start to flow, creating millions of jobs and more tax money for Washington… Extending the budget window to 25 years would cut the Gordian knot, unravel the Byrd Rule and allow serious tax reform to create millions of jobs in the years to come.”
Rachael Slobodien - June 13th, 2017
“This bill must be a real repeal of Obamacare; it must help hardworking Americans to be able to buy affordable health insurance.”
Washington, DC –As the Senate continues to work through what should constitute an Obamacare repeal bill, Club for Growth President David McIntosh drew a line in the sand and released the following statement:
“While we await the release of the Senate bill’s text, one thing that is not open to debate or interpretation is that this bill must be a real repeal of Obamacare; it must help hardworking Americans to be able to buy affordable health insurance,” stated Club for Growth President David McIntosh.
“There are two tests for whether the Senate bill is an improvement over the House bill:
First, the Senate bill must do more to reduce the costs of health insurance premiums. This means further rolling back Obamacare regulations and opening up competition across state lines.
Second, the Senate bill must be a real repeal of the other portions of Obamacare, including the tax hikes and dramatic expansion of Medicaid.
Club for Growth has long fought to repeal Obamacare—and would like to see a repeal bill pass— but current discussions should not lead to a weakening of what constitutes a real repeal of Obamacare.”
Today, the Club for Growth also joined with Americans for Tax Reform and nearly 50 conservative groups and sent a letter to Senator Orrin Hatch urging him to include a repeal of Obamacare’s taxes in the Senate’s forthcoming Obamacare repeal legislation. Here is a link to view the letter in its entirety.
Rachael Slobodien - June 13th, 2017
45 Conservative Groups and Activists: The Senate Should Repeal All Obamacare Taxes
June 13, 2017
The Honorable Orrin G. Hatch
Chairman, Senate Committee on Finance
219 Dirksen Senate Office Building
Washington, DC 20510
Dear Chairman Hatch:
As the Senate continues to make progress on legislation to repeal and replace Obamacare, we urge you and your colleagues to include repeal of the nearly 20 taxes imposed by the law.
During a February 1 speech at the Chamber of Commerce, you declared, “All of the ObamaCare taxes need to go as part of the repeal process.”
Recent media reports suggest that the Senate may be wavering on repeal of these taxes. This would be a mistake. The final Senate repeal package should retain the broad tax relief that was included in the House passed American Health Care Act.
The roughly one trillion dollars in new or higher taxes imposed by Obamacare directly hit middle class families and small businesses, raise the cost of healthcare, and reduce access to care.
Obamacare taxes directly suppress economic growth. The best example of this is the 3.8 percent so-called Net Investment Income Investment Tax (NIIT) on capital gains and dividends. Historically, capital gains taxes have a significant negative impact on capital formation, productivity, and economic growth while raising little or even negative revenue.
Repealing the 3.8 percent NIIT would return the capital gains tax rate to 20 percent, the rate agreed to by President Clinton and a Republican Congress in 1997.
A related tax hike is the 0.9 percent Medicare surtax on wages and self-employment income, the repeal of which was unfortunately delayed six years by an amendment in the House. It should be repealed as expeditiously as possible.
Other Obamacare taxes directly impact the ability of Americans to meet healthcare costs, such as the income tax hike on families with high medical bills. Around 10 million families pay $200 to $400 in higher income taxes each year because Obamacare increases the threshold at which families can deduct medical expenses paid out of pocket.
Obamacare also makes it harder for individuals to save for their own healthcare choices. Roughly 20 million Americans use tax-advantaged Health Savings Accounts (HSAs) to save for healthcare costs. Another 30 million use Flexible Spending Accounts. There are multiple taxes that restrict the ability of families to use these savings accounts, which limits the choice of consumers.
Other taxes hit certain healthcare industries, such as insurance providers, medical device and prescription drug manufacturers. Inevitably, these taxes are passed onto American families in the form of increased costs.
Finally, the tax associated with the employer mandate has limited millions of Americans to part-time work and the tax penalty associated with the individual mandate hit eight million Americans in 2014, with a family of four facing an income tax hike exceeding $2,000.
True repeal of Obamacare means repealing the Obamacare taxes and the Senate should resist the urge to deprive taxpayers of relief in order to pay for higher spending.
We commend you on your stance to repeal these Obamacare taxes and urge any final package accelerate or at least maintain the House-passed tax reductions. (more…)