Club for Growth Leads Coalition Urging Trump to End Taxation of “Phantom Income;” Encourages Executive Order
Rachael Slobodien - September 26th, 2017
Washington, DC – Today, Club for Growth along with nearly 30 other conservative groups sent a letter to President Trump and Treasury Secretary Steve Mnuchin asking that they issue an executive order that would index capital gains to inflation so that taxpayers are no longer forced to pay taxes on “phantom” gains. In the letter, the conservative organizations explain that this Executive Order can essentially serve as a pro-growth “down payment” to help ignite the broader conversation of tax reform ahead of the Big Six’s proposal.
Below is the text of the letter along with a full list of organizations who signed it.
Dear President Trump and Secretary Mnuchin,
On behalf of the following organizations representing millions of American taxpayers, we write to strongly recommend that you end the tax injustice that is currently included in the computation of capital gains. Specifically, we request an Executive Order that would index capital gains to inflation so that taxpayers do not pay taxes on “phantom” gains.
For much the same reason that income tax brackets were indexed to inflation over 30 years ago, we believe that it is only a matter of fairness to do the same for capital gains.
For example, if someone saving for retirement purchased an S&P index fund for $1000 in 1997 and dutifully held it for 20 years, they could now sell it for $2665. That’s a gain of $1665. Unfortunately, the full amount would be subject to taxation. But $538 of that $1665 isn’t a real gain at all. It’s phantom income that was eaten away because of inflation. And yet, taxpayers are currently forced to pay taxes on this nonexistent income.
Signing this Executive Order would have an immediate, pro-growth effect on the American economy. The real after-tax rate of return on all equities would immediately be priced higher – thereby increasing the wealth held by the millions of working and retired Americans who own 401ks, IRAs, mutual funds, and brokerage accounts. It would further encourage people to expand their savings, and incentivize people to start doing so. By preventing the money from unjustly going to the government, it could be re-invested in the economy, allowing businesses to expand, innovate, and create more jobs.
We strongly believe that this Executive Order is a pro-growth “down payment” that will help ignite the broader conversation about tax reform. And our groups look forward to the opportunity to continue working with the Administration to enact comprehensive tax reform this fall.
Rachael Slobodien - September 13th, 2017
By David McIntosh
As Republican majorities return to Congress this September, they face an existential threat entirely of their own making. Failure to repeal Obamacare and increased uncertainty about the fate of long-awaited tax reform have placed public approval for Congress in the tank . . .
. . . New polling of Republican voters conducted for the Club for Growth revealed that support for Congress among Republicans collapsed from a net positive of 24 points to a net of only eight points after the Senate’s failure on Obamacare. According to the polling, conducted by Fabrizio, Lee and Associates, Republicans risk cataclysmic losses in the midterm elections unless they correct course.
Nationally, one quarter of Republicans already say they will oppose Republicans who refused to support Obamacare repeal. Another fifth of Republican voters say they will support neither Republicans nor Democrats.
The situation becomes even bleaker if Republicans in Congress fail to pass tax reform. Nearly one in five will oppose members if they do not pass tax cuts. Another 25 percent of Republican voters will not support either party — meaning they will likely not vote at all. . .
These findings leave no room for confusion. They can be summed up succinctly in three words: Republicans will lose. If Congress does not repeal Obamacare and additionally fails to pass tax reform, 63 percent of GOP-leaning independents say they will vote for Democrats or stay home. Additionally, 68 percent of libertarian Republicans and 59 percent of Tea Partiers will either oppose Republicans who betrayed them on health-care and taxes or not vote at all. . .
Fortunately, Republicans . . . of all stripes appear determined to pass major tax legislation by year’s end. The Republican proposals for deep tax cuts for businesses, a competitive international tax structure, and elimination of the death tax are the best chances the country has to solidify sustained economic growth and middle-class job creation. Congressional Republicans have a president ready to sign tax reform legislation, and after thirty years of talking about pro-growth tax cuts, Congress should be ready to deliver.
Best of all, if and when Republicans pass tax and health care reform, they will also win on the electoral front.
. . .
Trump’s message in Missouri — challenging Democratic Sen. Claire McCaskill to vote for upcoming tax reform — is precisely what all Republicans should be doing. . .
Republicans can take one of two paths. More of the same will lead to overwhelming defeat in the 2018 midterms. The better path is to pass longstanding priorities like deregulation of the energy and health-care markets and major tax cuts.
Conservatives stand ready to help them secure these legislative victories. In so doing, not only will these policies lead to economic growth and a stronger America — they will show voters that Republicans can and will use their majorities to benefit the entire nation.
Stacy French - August 24th, 2017
Stacy French - August 22nd, 2017
Rachael Slobodien - July 27th, 2017
Washington, DC – Club for Growth Vice President Andy Roth offered the following statement in response to the news that a Border Adjustment Tax (BAT) would not be included in the tax reform principles the White House and GOP Congressional leaders unveiled today. Club for Growth played an instrumental role in influencing the BAT debate and ensuring its ultimate demise. Earlier this year, Club for Growth spent nearly $700,000 on ad buys urging Republican Members of Congress to oppose the BAT. Links to these ads are included at the bottom of this release.
Club for Growth Vice President Andy Roth remarked:
“Today is a great day for the American taxpayer. From the get-go, Club for Growth led efforts to inform the public of the harmful economic impacts a BAT would cause.
“Talk of a BAT had quieted as Congress began realizing – in part because of the attention Club for Growth brought to the issue – the harm a BAT would wreak on our nation’s economy and the pocketbooks of hardworking Americans. But until today’s announcement, the BAT was lurking in the shadows ready to rear its ugly head.
“As Club for Growth President David McIntosh remarked earlier this summer, ‘we should kill the BAT, bury it, and give it a funeral.’ Well, we’re pleased today to do exactly that. In fact, we’ll lead the procession.
“Now that the BAT is dead and buried, we look forward to working with congressional leaders and the White House to push for pro-growth tax reform. The Club strongly supports lower tax rates for individuals and businesses, lower taxes on capital, and a simplified tax code that supercharges the economy.”
The ads ran in the following districts and can be viewed by clicking the links below.