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Comprehensive tax reform now

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As the 2016 presidential campaigns heat up, we are beginning to see the candidates’ tax policies take shape.

Presidential candidate Sen. Bernie Sanders (I-Vt.) has highlighted income inequality as the focal point of his campaign and has recently unveiled aspects of his tax plan aimed to realize greater wealth redistribution among Americans. In doing so, Sanders has endorsed steep tax increases on high-income individuals in order to pay for increased government spending.

{mosads}As usual, America’s job creators would be tapped to foot the bill for inefficient and ineffective federal programs. These programs seek to regulate economic outcomes, and they come at the cost of economic freedom, widespread opportunity, and, ultimately, growth. Drastic tax hikes include Sanders’ own legislation, the Responsible Estate Tax Act, which calls for an across-the-board hike on death tax rates and lowering of the exemption levels for families experiencing the passing of a loved one.

Sanders’ bill would raise death tax rates from their current levels of 40 percent to a top rate of 65 percent for some families. Additionally, the bill would lower the exemption level by nearly $2 million, greatly increasing the number of individuals liable for paying the tax. Gratefully, we know the bill is merely a campaign stunt. And it stands in sharp contradiction to April’s successful, bipartisan House vote that would have repealed this burdensome tax altogether.

Congress needs to build upon the continued, bipartisan tax-reform efforts and work together to deliver real results for hardworking taxpayers.  Legislators must prioritize comprehensive tax reform that creates a simpler, flatter, and fairer tax code for all Americans.  

To move past a stalemate, any effort for reform must not fall prey to partisanship. This will lead to flawed proposals that only benefit large corporations. Instead, the parties can find common ground in providing much-needed relief to small and medium-sized businesses. The people who run these businesses are the “shrinking middle class” we hear both parties talk so much about. They have struggled through increasing tax rates that have hampered their ability to expand and hire more employees.

Over the past couple of years, I have taken part in a research campaign with Each American Dream and Frank Luntz to better understand how Americans feel regarding taxes and spending.

The truth is, Americans are appalled when they are informed that over 90 percent of all taxes are paid by the top 20 percent of taxpayers. When asked where the tax burden falls in this regard, only 8 percent of Americans can identify this fact with accuracy. Furthermore, when asked what should be the most a wealthy person could pay in total taxes and still be considered a “fair” level of taxation, over two-thirds of Americans responded that a rate of 30 percent or less was fair.

When made aware of the facts, Americans change their minds about taxes. They believe taxes should be lowered for all taxpayers. They believe the American people should not send one more dime to Washington until Congress and the president comb through the budget line-by-line and eliminate all of the wasteful spending.

It has become cliché in political circles, but we really do have a spending problem—not a problem with revenue. I agree with the American people in their opinion that the federal government is inefficient and ineffective and should focus more on what is important—building a healthy economy that creates more jobs for more people. Lawmakers have a duty to work together to preserve the American Dream. Instead of taxing wealthier people more, let’s focus on how we can create more wealth for more people and build a society that encourages hard work and success.

It’s a disservice to young people to tell them their hard work and determination aren’t rewarded in America. If we sell them short, they’ll come up short. If we encourage them to work hard, dream big, and believe in themselves, they can improve their quality of life.  If we embrace these notions as a policy goal, Americans will once again have the confidence in the economy and their government they once did.

As we approach our next presidential election, we should look to leaders who unite us rather than divide us against one another by class or income. Let’s not fall into the same old rhetoric this election season. As our economy continues to recover, we need real leaders who put forward good public policy that respects success and that benefits all Americans—not politicians who seek to divide us over class and income for their own ambitions.

Soldano is chair of Each American Dream, a 501 (c)(4) organization dedicated to defending and promoting the values of economic freedom and opportunity.

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