House and Senate Republicans joined together today to offer legislation to make the Republican "dream" tax package reality, according to BNA's Jan 23, 2008 "RealTime" news service. The package was presented in H.R. 5105 (introduced by David Dreier of California on the House Budget Committee and co-sponsored by various republicans such as Eric Cantor of Virginia) and its companion bill S. 2547 (introduced by Missouri's Senator Chris Bond). The sponsors say that they want these considered as part of the stimulus package.
The proposal would (among other things):
- repeal the estate tax
- repeal the gift tax
- lower corporate income tax rates by 10%
- make the 2001-2003 Bush tax cuts permanent, and
- make the (expired) research and development credit permanent.
A section-by-section description is available on BNA at http://op.bna.com/dt.nsf/id/gker-7b5uv2/$File/Fair%20and%20Simple%20Tax%20Act%20Section-By-Section.doc.
None of these is a good idea and none of them have anything at all to do with providing the kind of immediate economic stimulus that might help the sluggish economy that is already suffering from the burden of long-term deficit and debt funding. This package amounts to another give-away to wealthy taxpayers at the very top of the income distribution curve and no real aide for ordinary taxpayers in households that make $100,000 or less a year. (Just one example for illustration--estate tax repeal by definition only benefits millionaires, since the exemption amount protects all but fewer than 5 in 100 estates from having any tax at all.) The proposal appears to be an election-year ploy designed, again, to fool us sometimes silly Americans into thinking that tax cuts like these will make up for the creation of real businesses and real economic productivity. We all like to get a tax break while thinking that the economy will still produce sufficient revenues to cover the many programs we want funded, but let's get real about what these tax breaks really do and to whom the benefits primarily accrue.
Making the Bush tax cuts permanent is already off the table as far as consideration as part of the stimulus package is concerned. The rest of them should be, too.