Report Draws Attention to 23 Tax Loopholes Worth $800 Billion in Chairman Camp’s Tax Bill
WASHINGTON – Americans for Tax Fairness (ATF) and the National Women’s Law Center (NWLC) on Tuesday released a report drawing attention to 23 tax loopholes slated for closure in the Tax Reform Act of 2014, introduced by Rep. Dave Camp (D-MI), chairman of the House Ways and Means Committee. The report recommends closely considering these 23 loopholes as a possible first step toward major tax reform.
Members of the Americans for Tax Fairness coalition, which includes 400 state and national organizations, have strongly advocated closing tax loopholes in order to make sure corporations and the wealthy pay their fair share of taxes and to provide adequate revenue for vital services. The 400 members do not formally endorse closing all 23 of the loopholes identified in the report.
“While much separates the various sides on tax reform, we are pleased to have found some common ground on specific tax loopholes that should be closed,” said Frank Clemente, executive director of Americans for Tax Fairness. “These loopholes provide an unfair advantage to special interests that drain resources needed for vital services. I only wish that Chairman Camp had applied the same principle to the tax extender bills he is promoting in the House, or that he proposed paying for them by closing other corporate tax loopholes, as his tax reform bill proposes.”
“Corporations have not been asked to contribute a dime in additional revenue toward deficit reduction—while vital programs have been slashed, emergency unemployment benefits have been cut off, and investments in infrastructure and education that would create jobs and expand opportunity have been rejected,” said Joan Entmacher, Vice President for Family Economic Security at the National Women’s Law Center, and co-author of the report. “It’s past time for Congress to stop putting the burden of deficit reduction on working families, and to start closing the unfair tax loopholes that Rep. Camp has identified.”
Closing these 23 tax loopholes in the Camp tax reform bill would increase revenues by at least $792.6 billion over 10 years, according to Joint Committee on Taxation (JCT) data. The actual savings likely would be hundreds of billions of dollar higher because some of the provisions were not separately scored by the JCT.
Of the $792.6 billion that was scored by JCT, $764.7 billion would be due to closing tax breaks and loopholes for corporations; $27.9 billion would result from closing deductions and limiting exclusions for individuals. Among the corporate tax breaks targeted for repeal in the Camp tax reform bill and flagged in the joint ATF-NWLC report are LIFO inventory accounting ($79.1 billion), amortization of research and experimentation expenses ($192.6 billion), and the amortization of certain advertising expenses ($169 billion.) The list also includes the recommended imposition of an $86.4 billion excise tax on “systemically important financial institutions” (SIFIs.)
The ATF-NWLC report comes as the House begins debate on six bills recently approved by party line votes in the House Ways and Means Committee that would make permanent six corporate tax breaks costing $310 billion over 10 years, according to JCT. Committee Republicans passed the legislation without offsetting the cost – if the bills become law they will increase the deficit by the entire amount. The Americans for Tax Fairness coalition strongly opposes making those tax breaks permanent and believes other corporate tax loopholes should be closed to pay for them.
Americans for Tax Fairness is a diverse coalition of 400 national and state organizations that collectively represent tens of millions of members. The organization was formed on the belief that the country needs comprehensive, progressive tax reform that results in greater revenue to meet our growing needs. ATF is playing a central role in Washington and in the states on federal tax-reform issues.