U.S. Rep. Buddy Carter, R-1, gave an address Wednesday to the Georgia Society of CPAs on a tax reform bill Congressional Republicans are attempting to pass.
The reform bill is still in the early stages, but Carter said Republican House Speaker Paul Ryan of Wisconsin was confident the U.S. House of Representatives would pass the bill by Christmas Eve.
There are 2.4 million words in the U.S. tax code, Carter said. Simplifying the code was a pillar of the Republicans’ legislative plan, “A Better Way,” announced last year.
One of Carter’s major selling points for the bill was simplification, which lawmakers have been promising. Seven tax brackets will be reduced to three — four if you count those who don’t pay taxes in a zero-percent bracket. Carter said as many as 40 percent of people in the U.S. do not pay taxes. The other three brackets would be 15, 25 and 35 percent for different income levels.
Republicans pushing the tax plan insist it would provide badly needed tax relief to the middle class, but the Associated Press reported earlier this month that the wealthiest Americans would reap big benefits. The plan would drop the tax rate for Americans making a half-million dollars or more by 5 percentage points.
Carter reiterated another primary goal of the Republicans’ tax reform plan, which he said is to reduce the amount of paperwork needed to file taxes to the point where income taxes can be filed on a postcard.
The estate tax is also in the bill’s crosshairs. Carter said Georgia, in particular, has lost many family farms and small businesses because of the estate tax. Any reform Republicans proposed would completely do away with the tax.
Tax deductions are also on the table, with the exception of deductions for mortgage interest and charitable donations. One of the deductions Republicans want to cut allows payments for state and local taxes to be deducted. Private citizens would no long be able to claim this deduction, but most businesses would, Carter said.
The Associated Press reported earlier this month that, under the plan, homeowners would be forced to choose between two popular tax deductions — one for local property taxes, the other for mortgage interest — under a potential compromise House Republicans were considering as they craft the evolving tax revamp.
Carter said the Republicans’ plan to significantly cut corporate tax rates in hopes of encouraging more business growth in the U.S. The reform bill would also reduce taxes charged on money being moved back into the county from foreign banks.
Carter opened the floor to questions after his address. A member of the society said the tax brackets aren’t the problem, the problem is getting to the tax base from the bracket.
That may be true, Carter said, but reducing brackets would still simplify the code and lawmakers would consider more means of simplifying the tax code as they write the bill.
Another member asked what obstacles Carter sees in getting tax reform passed. Carter joked that Senate Democrats were one obstacle, before adding that partisanship in Congress is not as bad as the news media makes it look.
He couldn’t foresee many obstacles, as, in his opinion, the bill would do the most good for the middle class.
At the request of another member of the society, Carter gave examples of some bills House Republicans passed that have made it to law. He said the Department of Veterans Affairs Accountability and Whistleblower Protection Act, which was passed in an effort to reform VA hospitals, and the Comprehensive Addiction and Recovery Act, which emphasizes treatment over incarceration in opioid-related arrests.
Before the meeting was adjourned, the society gave Carter a mug and other items.
The Associated Press contributed to this report.
