What the GOP platform says about taxes(Read article summary)
The Republican platform approved yesterday by the GOP convention is an attempt to merge standard party views on taxes with candidate Donald Trump’s less orthodox positions.
The Republican platform approved yesterday by the GOP convention is an attempt to merge standard party views on taxes with candidate Donald Trump’s less orthodox positions. In some important areas, it is hard to see how the two mesh.
For instance, the platform calls for a bottoms-up rewrite of the tax code while Trump would retain its basic framework. It endorses a territorial tax system that Trump rejects. It calls for eliminating special interest tax provisions while Trump would retain most. And like many past GOP platforms, it calls for a balanced budget and paying down the national debt. In contrast, Trump’s tax cuts would add more than $11 trillion to the federal debt over the next decade and $34 trillion by 2026.
The document also flatly rejects the idea of a Value Added Tax unless Congress simultaneously repeals the income tax, a concept that conflicts with a tax framework released just weeks ago by House Speaker Paul Ryan and most of his GOP caucus. Without an income tax as a mechanism to provide a rebate for low-income households, it is impossible to make a consumption tax progressive.
And it joined Trump in endorsing the controversial idea of allowing churches and other non-profits to retain their tax-exempt status and campaign for political candidates.
Here are eight key tax planks of the GOP platform, in its own words.
The importance of taxes. “Republicans consider the establishment of a pro-growth tax code a moral imperative. More than any other public policy, the way government raises revenue — how much, at what rates, under what circumstances, from whom, and for whom — has the greatest impact on our economy’s performance. It powerfully influences the level of economic growth and job creation, which translates into the level of opportunity for those who would otherwise be left behind. Getting our tax system right will be the most important factor in driving the entire economy back to prosperity.”
Tax reform. “The current tax code is rightly the object of both anger and mockery. Its length is exceeded only by its complexity. We must start anew…. It cannot be engineered from the top down, but must have a common sense approach, and be simplified. Wherever tax rates penalize thrift or discourage investment, they must be lowered. Wherever current provisions of the code are disincentives for economic growth, they must be changed. We will not divide the American people into winners and losers. We will eliminate as many special interest provisions and loopholes as possible and curb corporate welfare, especially where their erosion of the tax base has created pressure for higher rates.”
Corporate taxes. “American businesses now face the world’s highest corporate tax rates…. We propose to level the international playing field by lowering the corporate tax rate to be on a par with, or below, the rates of other industrial nations. We endorse… switch[ing] to a territorial system of taxation so that profits earned and taxed abroad may be repatriated for job-creating investment here at home. We believe American companies should be headquartered in America. We should reduce barriers to accomplishing that goal.”
Consumption taxes. “To guard against hypertaxation of the American people in any restructuring of the federal tax system, any value added tax or national sales tax must be tied to the simultaneous repeal of the Sixteenth Amendment, which established the federal income tax.”
The budget deficit. “Our national debt is a burden on our economy and families….We must impose firm caps on future debt, accelerate the repayment of the trillions we now owe….and remove the burdens we are placing on future generations….”
The IRS. “The IRS has become an ideological attack dog for the worst elements of today’s Democratic party. It systematically targets conservative, pro-life, and libertarian organizations, harassing them with repeated audits and denying their tax-exempt status….Its commissioner should be impeached by the House of Representatives and convicted by the Senate. We also support making the federal tax code so simple…that the IRS becomes obsolete and can be abolished.”
The right of tax-exempt churches to engage in elections. “Because of the vital role of religious organizations, charities, and fraternal benevolent societies in fostering generosity and patriotism, they should not be subject to taxation and donations to them should remain deductible. We support repeal of the Johnson amendment, which restricts First Amendment freedoms of all non-profit organizations by prohibiting political speech.”
Carbon tax. “We oppose any carbon tax. It would increase energy prices across the board, hitting hardest at the families who are already struggling to pay their bills.”
This article originally appeared on TaxVox.