Domestic Taxes

The GOP summer calendar reveals a plan to hammer Obama and Democrats on the economy, energy and taxes. 

Rep. Nancy Pelosi's call for people with income above $1 million to pay higher taxes reopens a debate among Democrats.

Sen. Schumer has been derided for his bill aimed at punishing people who renounce their citizenship to avoid taxes.

Two top senators said Wednesday they were launching a bipartisan investigation into whether a non-profit veterans group is exploiting its tax-exempt status.

Sens. Max Baucus (D-Mont.) and Richard Burr (R-N.C.) expressed concern that a relatively small amount of the funds raised by the Disabled Veterans National Foundation (DVNF) was going to help veterans.

Baucus, the chairman of the tax-writing Finance Committee, and Burr also cited media reports that asserted that the veterans’ group had paid tens of millions of dollars over a three-year span to a marketing and direct mail firm.

“We owe our veterans a debt of gratitude that can never fully be repaid,” Baucus and Burr wrote in a letter dated Wednesday to Precilla Wilkewitz, the president of DVNF. “We will continue to stand up for our veterans in every way we can. Based on this commitment, we believe an organization which purports to help disabled veterans and operates as a tax-exempt organization deserves special scrutiny.”
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The House Democratic leader said the issue should be resolved "as early as next week" to lend confidence to consumers.

Senate Majority Leader Harry Reid (D-Nev.) on Tuesday blamed Republicans for standing in the way of a broad deficit deal, saying the Tea Party had made the GOP unreasonable about the country’s fiscal issues.

Reid, in a letter to his Republican colleagues, added that Tea Party influence was cutting off any chance of a debt deal before voters head to the polls in November.

“The American people want a balanced approach to fiscal policy that combines smart spending cuts with revenue measures that ask millionaires and big corporations to pay their fair share,” Reid wrote. “Yet a strict adherence to Tea Party ideology among Republicans in both the House and the Senate has so far put that balanced, common-sense solution out of reach.”

A leading trade group for the retail industry launched a 60-day ad and grassroots campaign on Tuesday urging Congress to approve an online sales tax.

The ad blitz is part of the National Retail Federation’s (NRF) multiyear, $10 million campaign “Retail Means Jobs.” NRF officials said more than $1 million of the funds could eventually be used for the sales tax campaign. 

The ads target voters, small-business owners and retailers in 17 states, including ones that are represented by members of the House Judiciary Committee, which has jurisdiction over the tax issue.

Sen. Bob Casey (D-Pa.) on Monday urged the House to vote on a proposal to penalize citizens who give up their U.S. passports for tax purposes, not long after Speaker John Boehner appeared open to the idea.

Casey, in a letter to Boehner (R-Ohio), said the bill he introduced last week with Sen. Charles Schumer (D-N.Y.) would strengthen current law to ensure that Americans who renounce their citizenship to lower their tax bill are held accountable.

The two Democrats introduced the measure after Eduardo Saverin, the co-founder of Facebook, dropped his citizenship last year, months before the social-media company went public. Saverin’s decision is estimated to have saved him tens of millions of dollars in taxes — though the Brazilian-born entrepreneur, who now lives in Singapore, has said that did not play a role in his choice.

“We must take action against those who capitalize on the advantages of United States citizenship, but abuse the system to avoid paying their fair share,” Casey wrote to Boehner. “If the expatriate has built their fortune using resources only available to them because of their United States citizenship, then it is only fair that they pay their portion of tax on future gains instead of simply renouncing the country that has made their success possible.”

The vast majority of GOP senators on Thursday pressed Democrats to quickly extend current tax rates, arguing that allowing them to lapse would be the biggest tax increase ever in the United States.

Forty-one senators in all said that Congress should move this summer on continuing all of the current tax cuts, first enacted under George W. Bush and last extended in 2010, and that failing to extend the rates would be an anchor on an economy that is also scheduled to absorb steep automatic spending cuts.

That combination of tax increases and spending cuts has been alternately dubbed a fiscal cliff or "Taxmageddon," and analysts have said that the full weight of both could send the country tumbling back into recession. Current tax rates expire at the end of the year, while the spending reductions start in January.

“We can think of no better steps to take than to address the recessionary threat of Taxmageddon and eliminate some of the uncertainty that continues to contribute to economic malaise,” they wrote to Majority Leader Harry Reid (D-Nev.).

House Ways and Means Committee Chairman Dave Camp (R-Mich.) said Thursday that he believes he could settle on a fast-track process for tax reform in 2013 by the time lawmakers leave Washington in August. 

Speaker John Boehner (R-Ohio) said this week that Republicans would push to broadly overhaul the tax code next year, and use the looming expiration of the Bush tax cuts as leverage. 

That would require a procedure for forcing and expediting tax reform in 2013, and Camp said Thursday that Republicans were looking at 34 separate examples, including Trade Promotion Authority.

The Ways and Means chairman said that examination was still in an “embryonic stage,” but that he thought he could whittle the options down before the summer recess.

“Whether that’s something everyone else accepts may take more time,” Camp told reporters after speaking at a policy seminar. 

“Some of this was talked about in supercommittee,” added Camp, who was a member of that panel, which could not come up with a deficit-reduction plan. “So there are members who have been thinking along these lines on both sides. But we’re going to try to see if we can take a best from those different processes.”