Colorado Senate Debates "Dirty Dozen" Tax Package

The “Dirty Dozen” tax hike package that was recently approved by the Colorado House of Representatives now heads to the Senate floor after it was passed out of the Senate Finance Committee on a 4-3 party line vote last week.

The package is scheduled for its second reading in the Senate today and, given the sizable Democrat majority in that chamber, is expected to receive final approval by week’s end. Colorado Republicans remain in lockstep opposition to the package.

ATR has repeatedly pointed out that these measures will send jobs out of state, as similar measures have in other states, and will fail to rectify the state’s budget deficit, as has been the case in other states that have imposed similar measures. The tax increases on online purchases and downloads are guaranteed to destroy high-paying tech sector jobs. The tax hikes on items such as soda, candy, doggy bags, and napkins will hit those least able to afford it the hardest.

As has been previously pointed out, the state constitution’s Taxpayer Bill of Rights (TABOR) requires that these tax increases be sent to the ballot for voter approval, yet Colorado Democrats have no intention to honor this requirement. For information on the Colorado Supreme Court case that has enabled this tax package to move forward and the effort to remove the Justices responsible for that ruling, visit Clear the Bench Colorado’s website.

Governor Ritter and legislative Democrats insist tax increases are needed to close the state’s budget shortfall. However, Senate Republicans laid waste to that claim by recently releasing an alternative budget that closes the state’s budget deficit without raising any taxes. That plan, which ATR supports, entails a .25% reduction state payroll spending in the current budget and a 4.4% reduction for the coming fiscal year that begins in July.

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More Job Creation By The Federal Government

 Last week I was forced to admit that the Federal Government was indeed creating jobs (albeit in the field of bankruptcy attorneys and repo-men).

Today I once again am forced to admit another area of job growth: federal government employees. Because, it seems, according to the president’s new budget, federal civilian employment in the executive branch will be 15% higher in 2011 than it was in 2007.

Of course, the only problem with this is that for each taxpayer-funded job created, multiple jobs in the actually productive private sector are lost, leading to a reduction in economic growth, and therefore lower living standards for all. 

So, essentially, useless jobs are being created, that we'll all have to pay higher taxes for, and will prevent business from hiring more employees. Yay. 

(Via Downsizing the Federal Government)

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Van Taylor, candidate for Texas State House, Signs Taxpayer Protection Pledge

Van Taylor, a Republican running in Texas’s 66^th State House District, recently signed the Taxpayer Protection Pledge sponsored by Americans for Tax Reform (ATR). By signing the Pledge, Taylor has made a written commitment that he will oppose any and all efforts to raise taxes in the Lone Star State. 

“Fiscal restraint and a commitment to limited government are the reason why Texas is the nation’s economic powerhouse and is why Texas has not followed the likes of California, Michigan, and New York into financial ruin. Van Taylor has proven that he intends to continue Texas’s commitment to pro-growth policies by signing the Taxpayer Protection Pledge,” Norquist continued. “I urge all candidates for federal and state office to make the same commitment to taxpayers by signing the Taxpayer Protection Pledge today.”

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February 6, 2010: Ronald Reagan Day

Today, the Ronald Reagan Legacy Project celebrates the 99th anniversary of our 40th President, Ronald Reagan. 

Every year we ask governors from all over the country to make proclamations setting aside February 6th as "Ronald Reagan Day."  In 2010, twenty-seven governors made this proclamation honoring the Gipper.  To see if your Governor made such a proclamation, click here. 

Each proclamation and every Reagan dedication serve as a "teaching moment"  to those who did not live to appreciate our 40th President.  Every road, building, or mountain named after Ronald Reagan serve as a reminder of his life and an opportunity to discuss the success of his presidency. 

The Ronald Reagan Legacy Project is dedicated to preserving the legacy of one of America's greatest presidents throughout the nation and abroad.  The proclamations from governors all over the country transcend partisan politics to honor a great president. 

Take a moment of your day to remember the life of our 40th President.  Have a nice Ronald Reagan Day. 

To see Grover Norquist's Ronald Reagan Day Op-Ed in the Washington Examiner, click here.

For more on the Ronald Reagan Legacy Project, click here.       

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The Obama Budget

 President Obama is touting all the advantages his budget has for small businesses.  In particular, he's talking about using TARP funding (supposedly temporary, to be paid back to taxpayers) for small business lending.

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Obama Feels International Pressure to Pass FTAs

Obama’s recent State of the Union address included comments about America’s free trade agreements (FTAs) with countries such as Colombia, Korea, and Panama. The President said, “We have to seek new markets aggressively, just as our competitors are. If America sits on the sidelines while other nations sign trade deals, we will lose the chance to create jobs on our shores.”

And yet, America’s trade agreements with the countries mentioned above have sat stagnant since the President took office over a year ago. An LA Times editorial reminds Obama that in order to achieve his SOTU promise of “doubling our exports in the next five years”, more significant steps must be taken to pass those free trade agreements.
 

Click "Read More" to see what other nations are saying about  Free Trade Agreements

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Obama Should Cooperate with Boehner and Cantor to Force Debate on Spending Reductions

On Thursday, House GOP leader John Boehner and GOP Whip Eric Cantor sent a letter to President Obama offering their help in forcing votes on proposed spending reductions and terminations. (The GOP Whip's backgrounder on expedited process for consideration of proposals to cancel spending can be found here.)

Today, ATR president Grover Norquist and Center for Fiscal Accountability executive director Sandra Fabry sent a letter to the President urging him to work with Boehner and Cantor to achieve these reductions and terminations. 

The text of the Norquist/Fabry letter is pasted below, and the PDF is here:

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Not All Bipartisan Reform Commissions Are Created Equal

There has been a lot of talk about various ideas to set up bipartisan reform commissions to address our fiscal problems.  However, as we have been pointing out, not all commission proposals are good ones. In fact, some of them would be extremely damaging if implemented.  

In order to help you discern which commission proposal is pro-taxpayer, and which one is not, we have put together a brief comparative analysis of six different proposals that have been floated.  Click here to view the chart.

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The Hidden Tax Hikes in the Obama Budget

Over the past week, ATR has been breaking open the Obama budget to examine all the new tax hikes (on international income, small business, and more to come).  Today, we wanted to take a quick look at the "tax gap" and "tax compliance" tax hikes in the budget.

People often make the mistake of skimming over tax compliance measures, but that would be a big mistake.  Over the 10-year budget window, the Obama budget projects that these compliance "reforms" will raise $13.8 billion to close the so-called "tax gap," $7.4 billion to "improve compliance by businesses," $4.4 billion to "strengthen tax administration," $36 million in increased penalties, and $23.7 billion in backdoor death tax hikes.  You can view the scores here (Table S-8).  Add these together, and you get a $49.4 billion total tax hike.  That's more than double the amount raised by taxing carried interest as ordinary income, so this is a lot of money.

There are a couple of dozen individual proposals, so we'll focus on just the most damaging ones for small business owners and those who work for small businesses:

• Corporate Information Reporting ($9.2 billion).  Under current law, small business owners and others need to issue "1099-MISC" statements to individuals and partnerships to whom they pay at least $600 for goods and services.  This expands that to also include corporations.  This could dramatically-increase the number of these forms that are issued, which will increase headaches for small business owners every January.
• Landlord Information Reporting ($3.1 billion).  This further expands the above reporting requirement to owners of rental properties.  Those to whom rent is paid would need to receive a 1099-MISC.
• Independent Contractor Discrimination ($7.3 billion).  This would permit the IRS to more easily re-classify independent contractors (who only need to receive a 1099-MISC in January) as employees (which requires hiring a payroll company, quarterly filing and tax payments, and a W-2 in January).  The real reason behind this is to make it easier to unionize people who are currently not employees.
• Economic Substance Doctrine ($4.2 billion).  This would give the IRS the power to determine that a transaction used to lower a tax bill "lacks economic substance."  This is an arbitrary standard, and would subject every small business decision to the whims of an IRS auditor

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PACT Act May Reduce Tax Hike Pressures

As states around the country are facing fiscal problems, a bill in Congress stands a chance to help alleviate pressures to raise revenues through damaging tax increases at the state level.

The PACT Act, which would make revisions to the Jenkins Act governing the collection of taxes on, and trafficking in, cigarettes and smokeless tobacco, may reduce tax hike pressures by recovering additional revenue as a result of increased compliance with the law, and consequently represents a prudent way to address the issue of illicit tobacco sales.

Click here to view ATR's letter to the Senate.

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