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6 Reasons to Be Skeptical of RINO Tax ‘Reform’

“We must do ‘something’ on health care so we can get to tax reform. Now!”

This is the latest rage and clamor among the big donors, lobbyists, and consultants within the less intelligent arm of the Democrat Party, otherwise known as the GOP.

The entire argument is built upon a false premise and will not result in sound policy unless conservatives grab the mantle on tax policy away from the party establishment.

There are many emergency public policy issues vexing our economy, society, sovereignty, security, and the core of our ability to operate as a democratic republic: the judicial oligarchy crisis, Afghanistan, debt, the entitlement and dependency state, uncontrolled immigration, Islamic terrorism, the collapse of the civil society, and challenges to religious liberty and core family values, just to name a few. These are all either new problems or issues where the trends have dramatically worsened, have become unsustainable, and will destroy our country. The same cannot be said of the tax code, at least not in terms of trends, unsustainability, and a sense of urgency.

As much as we all hate the tax code, “tax reform” is not one of those emergency “triage” issues needed to solve an unsustainable trajectory within the next few months. If anything, relative to almost any other policy issue, the trend on taxes has gotten relatively better after the Reagan and Bush tax cuts. The political realities of what we are dealing with today will make any play for tax reform an interception rather than a touchdown. Which is why it would be better to stay away from it, at least from a “comprehensive approach,” and tackle more pressing issues, such as immigration, terrorism, and homeland security – or de-regulation of major industries, government reforms, and stripping down the judiciary from its autocratic nature.

Don’t get me wrong: A fair tax or a truly low flat tax that doesn’t punish productivity, redistribute wealth, and socially engineer the economy with asset bubbles induced by tax pork would go a long way towards reviving our economy. There would be no better cause to pursue. Except that is not on the menu. Because of the following factors, it is clear that “tax reform,” which is already ill-defined, will never result in the sort of fair, pro-growth, limited-government outcomes we are looking for and will likely make things worse.

1. Debt is the challenge of our time, not taxes: Taxes used to be the most important domestic policy issue, not only because the tax structure determined how much money stayed in the private sector, but because it was the source of nourishment for the federal leviathan. As such, by cutting taxes, we’d accomplish both the goals of economic growth and limiting the size of government. That era is over. Debt, serviced by monetary manipulation, is the new nourishment of a much greater entitlement state than Reagan ever feared. That is the challenge of our time, much like taxes were the challenge of Reagan’s time. The lesson of the Bush years was that we succeeded on the tax issue but needed to begin work on spending, entitlements, and dependency. Instead, we have gone backwards.

2. Budget scoring severely limits tax reform: Closely related to the first point – because crushing debt and entitlements are the challenge of our time, it makes balanced budgets that much harder. Mandatory spending is projected to cost $34 trillion over the next 10 years, and deficits are estimated to grow by $7.8 trillion. And that is using the CBO’s everlasting optimistic baseline for both revenues and spending. The health care crisis alone will sink this country into insolvency before we reach the end of the 10-year budget window. In addition, there is a consensus to increase military spending. And that doesn’t begin to factor in Ivankacare and the $1 trillion infrastructure porkulous plan. This is a very different era from the Bush years, when there was a projected surplus. To be clear, I’m not one of those who believes we should pass up any opportunity to cut taxes. We have already crossed the Rubicon of Greece-like debt by funding endless dependency without paying for it, so I’m not about to start applying rules of balance to giving people back their own money and growing the economy. But that is the view of conservatives. Republicans in Washington will feel constrained by the need for deficit-neutral “tax reform.” They are already looking for all sorts of corresponding tax increases and new revenue streams to offset any cuts. That will not end well.

3. Not a lot of juice to squeeze out of tax cuts for non-wealthy: The dirty little secret is that half of tax filers don’t pay, on net, federal income taxes. Thanks in large part to the success of the Reagan and Bush tax cuts (plus the Obama tax increases on the wealthy), lower income and lower-middle income earners don’t incur a net positive tax liability. The bottom two brackets have already been eliminated. By definition, any tax cut is going to be enjoyed primarily by the wealthy because they are the ones who pay the taxes.

According to the Tax Foundation, in 2014, the top 1 percent paid 39.5 percent of all federal income taxes, even though they earned just 20 percent of the income pie. The top 5 percent paid 60 percent of the income taxes, even though they earned just 36 percent of the income. The bottom 50 percent, on the other hand, paid just 2.75 percent of the income taxes, even though they earned 11 percent of the income pie. The point is that the income tax is already more progressive than it’s ever been. Yet Republicans have no ability or desire to properly articulate this. Inevitably, they are accused of “cutting taxes for the wealthy.” As such, every time they pick up the “tax reform” ball, they wind up throwing even more refundable tax credits at the bottom and raising taxes, on net, for those at the top.

There is simply not a lot that can be done in terms of a tax cut plan that won’t be perceived as tax cuts for the rich. Not that there is anything wrong with that. This is why it would be wise for Republicans to focus on the hidden tax of regulations, such as the ethanol mandate and many other pernicious interventions, which collectively cost all families $15,000 a year. Until we abolish the 16th Amendment through an Article V convention, I just don’t see any political appetite from this party to truly flatten out the tax code. A true flat tax (even with an exception of the first $30,000) will result in a tax increase on many people. Personally, I’m fine with a low flat tax raising just enough revenue to fund the constitutional aspects of the federal government and with making sure that such a tax would be paid by everyone. But politically speaking, Republicans will never let that happen.

4. Liberals are writing the tax plan: The main players behind the administration’s tax plan are Gary Cohen, Steven Mnuchin, and Wilbur Ross – not a single Republican among them. This will not end well.

5. Buying off Democrats with porkulous: The administration has already hinted that it intends to work to garner Democrat votes rather than push reforms to the existing practice of the filibuster in the Senate. Some prominent supply-siders are already advocating for a trade of tax cuts for more infrastructure spending. As we’ve noted before, transportation spending should be devolved to the states instead of purveying the wasteful federal transportation sinkhole. It’s not worth the trade.

6. Health care must be fixed first: One of the most important reforms that can be made to the tax code is equalizing the treatment of health insurance plans purchased by the individual with employer-provided plans. This will help tackle “the original sin” of health care and get more people to cost-continuously purchase their own plans rather than rely on the over-utilized employer system. The problem is that until and unless Obamacare is repealed, there is no individual market left to which people can take their tax deduction and purchase a cheap plan. Given that Republicans don’t plan to repeal Obamacare – just simply “pass a health care bill” – there is no point in fixing the tax distortion on health insurance.

The path forward

The best way to preempt a bad tax plan is for conservative members of Congress to introduce Trump’s campaign tax plan as a bill and approach the president with it in the hopes of making this plan the default position. His plan is actually really good and politically defensible because it is not flat (which is nearly impossible to achieve), cuts everyone’s taxes, but lowers marginal rates significantly. Recently, the Trump administration has disavowed this plan, but conservatives should not let the president violate another campaign pledge.

However, even such a plan that we agree with will take months to iron out the details and build the proper case for it publicly. If the president doesn’t understand that and wants a quick “victory,” the best course of action is to push for an immediate reduction of the corporate tax rate from 35 percent to 25 percent without getting rid of any deductions (which would disrupt business models and take longer to work out). This will inject an immediate pro-growth shot into the economy at a time when it badly needs a recovery.

A modest reduction in corporate taxes is a proposition even many Democrats are on record as supporting. This has been a consensus issue, it will not disrupt the market, and it will not lose much revenue. Corporate taxes don’t bring in that much revenue to begin with. This can all be done in the short run while making the case for Trump’s original plan on individual taxes over the next few months.

When approaching the tax issue, Republicans cannot make the same mistake they did with the health care bill. We can’t assume “tax reform” is a policy punchline we all agree with, the same way “repealing Obamacare” clearly didn’t mean what it denoted. Both the broad principles and philosophy behind the effort as well as the details of the specific proposal matter. In the case of health care, Republicans adopted the Democrat philosophy, and the details of their original bill codified Obamacare instead of repealing it. The same will hold true for taxes unless conservatives take a proactive approach to stave off bad policy. (For more from the author of “6 Reasons to Be Skeptical of RINO Tax ‘Reform'” please click HERE)

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Yes, Change May Be Coming to America’s Tax Code, and It’s Going to Cost You MORE

Conservatives were told they must rush through a health care bill that doesn’t repeal Obamacare or heal the insurance market because there was an imperative to move on to tax reform. But much like with health care reform, the Trump administration and congressional Republicans never offered any details or philosophy behind their tax plan. We are now seeing that, once again, these “reform” proposals are more like interceptions than touchdowns.

Our tax code, much like our regulatory burden (which costs families $15,000 per year), punishes productivity, is too redistributive, socially engineers our economy, and has too much uncertainty. Yet, rather than lead with a plan that addresses these problems, Republicans are talking about raising taxes, and worse, opening up entirely new streams of revenue that will crush economic growth, job creation, and consumer pricing. Evidently, the projection of less than two percent growth for the indefinite future is too much for these people to handle. They are gunning for zero growth!

The Washington Post reports today that the Trump White House is mulling a carbon tax and a value-added tax (VAT), which is a de facto national sales tax on consumers and businesses alike. After all, nothing screams blue collar populism like driving up the cost of all products, energy, and basic goods sold at Walmart:

Administration officials are aware how politically divisive these ideas are, but they are searching for ways find new revenue sources.

The value-added tax, which is popular in many other countries, would serve as a kind of national sales tax, one that consumers would pay when they make purchases and that businesses would pay for supplies, services and raw materials. But many economists view a VAT as a tax that disproportionately hurts lower-income workers, who typically benefit from a progressive income-tax system.

A carbon tax would target the emissions of carbon dioxide and other greenhouses gases in the burning of gasoline, coal and other fossil fuels. Many Democrats support the creation of a carbon tax as a way to address climate change, but they couldn’t even reach an agreement on the issue when they had control of Congress and the White House during the early years of the Obama administration.

It’s as if we are in the twilight zone. This time into the Obama administration, they were voting on a Keynesian stimulus, cap and trade, and expanding government health care (SCHIP). Some things never change.

Clearly, as the Post notes, some administration officials strongly oppose these proposals, but the concern for conservatives is that the lead players on tax issues — Steven Mnuchin, Gary Cohen, and Wilbur Ross — are all progressives. It’s hard to imagine any pro-growth tax plan emanating from that trio, and no tax plan would be worth the creation of these pernicious new revenue streams that strike at the lifeblood of our economy.

This rumor comes on the heels of months of negotiations in pursuit of yet another tax increase — the border adjustment tax (BAT) — championed by Ways and Means Chairman Kevin Brady, R-Texas. His proposal would open a new revenue stream by taxing imports and subsidizing exports. Aside from social engineering the economy, this plan would devastate consumers who rely on cheap products from retailers.

Concurrently, the president has voiced support for yet another pernicious tax hike on “carried interest.” Although proponents use demagoguery to single out evil wealthy hedge fund managers, this plan would tax the sale of ordinary private equity partnerships as full income (even though they are already paying annual income taxes on the business) instead of at the lower capital gains level. This will drive a stake through the heart of entrepreneurship and risk taking — the lifeblood of capital formation.

A carbon tax, a VAT, a BAT, and raising taxes on investors are all bad ideas. It would be one thing if Washington were planning to abolish the income tax or the corporate tax altogether. But to add another revenue stream in return for a promise of some other tax cuts, which invariably make the code even more progressive … conservatives should not waste their time on this issue.

The seminal issue of our time, unlike during the Reagan era, is debt, dependency, and socialist health care. Not only will the leviathan bankrupt our country, but it is weighing down our economy to the point that the benefits even from legitimate tax reform will be somewhat muted. If Republicans are going to insist on pursuing the worst forms of taxation to pay for undefined “tax reform,” they should focus on actually reforming entitlements and dependency so that the budget scoring of future tax plans is not a problem.

In the meantime, Republicans should pursue a simple reduction in the corporate tax rate from 35% (or as high as 38.9%) to 25% without touching any deductions or creating disruptions. This will inject an immediate pro-growth shot into the economy at a time when it badly needs a recovery. And given that corporate taxes don’t even bring in that much revenue, a simple reduction to 25% (as opposed to 15%) is very achievable. Moreover, Democrats are already on record as supporting such an idea, and this would be a great way to call their bluff.

We’ve tried taxing and subsidizing our way into prosperity and it never works. The only positive aspect to Republicans dabbling in progressive ideas is that it will finally get Democrats to hate taxes and worry about the cost of public spending. (For more from the author of “Yes, Change May Be Coming to America’s Tax Code, and It’s Going to Cost You MORE” please click HERE)

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Big Nanny Republicans? West Virginia Proposes GOP-Backed Soda Tax

There are basically two schools of thought on the purpose of the tax code. One is to raise revenue to fund the essential functions of government, whatever those may be. The other is to use taxes as a carrot and a stick, rewarding behaviors the government finds desirable and punishing those that it doesn’t. America’s founders, the architects of the original tax code, would have found this second function, in which taxes are used for social engineering, unthinkable and against the very nature of the limited-government power structure they proposed. And yet controlling people’s behavior has become an increasingly important function of tax policy, despite its implications for individual freedom and independence.

This is the rationale behind the soda tax. It is asserted that America is undergoing an obesity “epidemic,” an insulting use of the term that falsely analogizes personal lifestyle choice to disease. It is therefore assumed that it is the responsibility of the government to “cure” the disease of people consuming too much sugar and fat.

This used to be an idea that was only proposed by meddling Democrats who think their mission in life is to tell other people what to do. Sadly, that appears to be the case no longer, as a soda tax proposal taking hold in West Virginia is being pushed by Republican lawmakers.

The proposed tax would charge five cents for every 16.9 fluid ounces of soda sold, a tax that would be split between consumers and retailers depending on how strong the demand. Five cents may not sound like much extra to pay, but consider that it represents a 400 percent increase on the rate at which soda is currently taxed. Additionally, two other bills have been introduced in the West Virginia legislature that would increase soda taxes a further one and two cents respectively.

One could argue that these incremental increases in price won’t actually have an effect on consumer choices, but both logic and empirical evidence contradict that claim. At any price, there are presumably some people who are already paying as much as they are willing to pay for soda. Increase that price, even a little bit, and they will substitute a more affordable beverage. It is these marginal consumers who account for the changes in the quantity of goods demanded when prices change. Evidence in cities where soda taxes have been specifically levied has shown us that higher prices do result in less soda sold.

For example, in Philadelphia, where the government imposed a 1.5 cent-per-ounce tax on sodas, distributors reported a drop in sales of between 30 and 50 percent that would potentially force layoffs. If this sales shock seems disproportionate to the amount of tax levied, it’s important to remember that there is a psychological component to consumer behavior as well as a financial one. Where I live, in Washington, D.C., the government levies a five-cent tax on plastic bags used at grocery stores. Almost everyone can afford an extra nickel added to their grocery bill, but many people have changed their behavior anyway, not because of the money, but because they don’t like the idea of being taxed any more than they already are. The same phenomenon is no doubt in effect in Philadelphia and would be evident in West Virginia as well.

There are lots of reasons to oppose a soda tax. Personally, I object to a central authority trying to modify citizen behavior, as if we are rats in a laboratory cage. But for those more pragmatic than I, another objection is the cost to the economy of making consumption — or, to be more accurate, the production that drives consumption — more difficult. Even without changes in consumption, the proposed tax would suck $75 million out of the economy each year, according to the Tax Foundation. Combine that with the layoffs and general decline in economic activity, and you’re looking at some serious harm to West Virginia, a state that already struggles economically.

Finally, there’s the fairness argument. Soda taxes have repeatedly been found to be regressive, meaning that they fall hardest on those Americans with the lowest incomes. “Tax the rich” may be a persuasive populist sentiment, but since when is “tax the poor” an equally good substitute? How about instead, we live within our means and don’t try to use the tax code for social engineering? Republicans in West Virginia need to get back to their roots and remember that conservatism is all about personal autonomy, limited government, and a nation in which individuals are free to choose. (For more from the author of “Big Nanny Republicans? West Virginia Proposes GOP-Backed Soda Tax” please click HERE)

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Look Out! New Border Tax Will Increase Your Cost of Living

Tax reform is one of the most important things the Trump administration might achieve. High on the new president’s list of priorities, the reduction of tax rates for corporations and individuals would be a tremendous boost for our economy, not to mention the purely moral aspect of allowing people to keep more of the money they’ve earned. However, there is one little-understood aspect of the proposed tax reform package that should have all Americans worried: the benignly named “border adjustment tax.”

This new tax is being floated as a way to raise revenue to cover the cost of the border wall, as well as to make up for other decreases in the corporate tax rate, and also as a way to incentivize exports and punish imports. Many people still mistakenly believe that importing goods and services is somehow bad while exporting them is good. This misunderstanding of trade policies is going to hurt American consumers considerably.

Here’s how the tax works. Proposed by Kevin Brady, R-Texas (F, 51%) and Paul Ryan, R-Wisc. (F, 52%), the border adjustment tax would disallow the deduction of business expenses incurred in other countries from a company’s taxable income. Currently, if a company buys inventory overseas and sells it domestically, it only gets taxed on the profits, not the entire revenue. This is the same for domestic companies that do all their business in the United States, and it’s easy to see why. If you purchase $100,000 of equipment to produce goods that only sell $110,000, it makes no sense to tax the whole $110,000, as doing so would make an otherwise profitable enterprise too expensive to sustain. Taxing only the profits allows companies with a large volume of sales but a narrow profit margin to continue to operate successfully.

Eliminating this system for imported goods means that many imports will simply not be worth the money. That means fewer available options for you and me. Those bananas grown in Costa Rica may disappear from supermarket shelves, forcing us to subsist on less exotic, homegrown produce. Turnips maybe. Yuck. Other imports will still be profitable, but only at increased prices, so once again, the American consumer is harmed by the tax.

The other piece of the border adjustment tax, designed to encourage exports, allows exporting companies to deduct business expenses, but exempts revenue earned abroad from taxation entirely. Thus, the company in the example above would be able to reduce its taxable income by the $100,00 in expenses, while not being taxed at all on the $110,000 in revenue. This means that, from the IRS’s perspective, the company will look like it lost $100,000, and can use that claim to qualify for tax refunds. In other words, it would be possible for a profitable exporter to get checks from the government, as if they were on the brink of bankruptcy.

Now, this is hardly fair, but perhaps the more important point is the incentive effect it will have on business. Notice that in the cases of both the exporter and the importer companies are punished for selling to Americans. Under such a tax structure, no company, whether it be located in the United States or elsewhere, will want to sell its products to American consumers if it can find buyers elsewhere. The tax advantages of selling to foreigners will simply be too great. This is not to say that no one will sell to Americans, it’s just that they will need an added incentive to do so, an incentive most likely to found in the form of higher prices.

So, let’s review, The border adjustment tax will remove some imports from the market, giving us fewer choices about what to buy, for the rest, it will raise the prices we pay. The tax also unfairly rewards those who sell their wares abroad, giving them no reason to want American customers unless they can charge higher prices as well. Americans get it both coming and going.

For a populist administration that claims to care about the plight of the working man, pushing a tax plan that will substantially increase his cost of living seems an odd choice.

Then again, no one ever said politics was rational. (For more from the author of “Look Out! New Border Tax Will Increase Your Cost of Living” please click HERE)

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Watchdog Finds Widespread Fraud at U.S. Census Bureau

baniDozens of government employees at the U.S. Census Bureau have been billing taxpayers for time they never actually worked, wasting more than $1 million.

The 40 officials were supposed to be performing background checks on the census personnel who walk door-to-door throughout the country to collect information about Americans. Instead, they “engaged in pervasive misconduct over several years,” according to an investigation by the Commerce Department’s inspector general.

The watchdog found at least one employee in the Census Bureau’s employment office who “used his official position as a personal hiring vehicle for friends and their families.”

That employee, who was not identified, “was involved in a sexual relationship” with a contractor he personally interviewed, hired and supervised . . .

The inspector general found that dozens of employees claimed to have worked at least 19,162 hours during which they actually did not work at all between 2010-14. The “time and attendance abuse” drained nearly $1.1 million. (Read more from “Watchdog Finds Widespread Fraud at U.S. Census Bureau” HERE)

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Obama Administration Sent Nearly 1 Million People Incorrect Tax Forms

By Fox News. The Obama administration revealed Friday that it sent about 800,000 HealthCare.gov customers a tax form containing the wrong information, and asked them to hold off on filing their 2014 taxes.

The self-inflicted bungle follows weeks of administration officials touting a successful enrollment season — one that saw far fewer technical glitches than the rocky launch in late 2013.

About 11.4 million people signed up this season. But the errors in tax information mean that nearly 1 million people may have to wait longer to get their tax refunds this year.

California, which is running its own insurance market, just announced a similar problem affecting about 100,000 people in that state.

For those using HealthCare.gov, the federal health department said on its blog on Friday that some people received a form that included faulty premium information. The blog said that information “needs to be corrected,” and new forms should be available by early March. (Read more about the incorrect tax forms HERE)

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A Second Chance to Avoid a Second Tax Penalty Over Obamacare

By Margot Sanger-Katz. About six million people face a tax penalty this year for failing to sign up for health insurance last year. Now, many of those people will get an extra chance to enroll in coverage for this year and avoid a second penalty.

Sign-ups were supposed to close this month, but the Health and Human Services Department announced Friday that it would reopen the marketplaces in 37 states for six weeks in March and April. The goal is to make sure that people who are learning about the deadlines and tax penalties for the first time won’t be shut out of coverage — and forced to pay a penalty — for a second year.

Several states running their own marketplaces, including Washington and Vermont, have announced similar policies

The health law requires everyone who can afford insurance to obtain it — and charges people who don’t a fee. The fees that will be hitting people’s mailboxes for failing to get insurance last year will be relatively low — $95 a person or 1 percent of their income — but they rise next year. (Read more from this story HERE)

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Millions to Owe Hundreds of Dollars in Obamacare Tax Penalties This Year

Photo Credit: NewscomSome 3 million to 6 million Americans will have to pay an Obamacare tax penalty for not having health insurance last year, Treasury officials said Wednesday. It’s the first time they have given estimates for how many people will be subject to a fine.

The penalty is $95, or 1% of income above a certain threshold (roughly $20,000 for a couple). So you could end up owing the IRS a lot of money.

Take a married couple with $100,000 in income – their bill comes to $797, according to the Tax Policy Center ACA penalty calculator.

The penalty for remaining uninsured rises to the larger of $325 or 2% of income in 2015.

As millions of Americans sit down in coming weeks to compile their tax returns, they’ll have to contend with Obamacare’s health insurance mandate for the first time. (Read more about the Obamacare tax penalty HERE)

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State of the Union 2015: Obama Deceives America Again

The Daily Signal laid out a number of lies that Obama told during Tuesday’s State of the Union 2015:

1. Budget Deficit Primed to Grow, Not Shrink

President Obama touted shrinking deficits in today’s State of the Union address. This is about the only time in the foreseeable future the president will get to say that. The average annual deficit over the next decade is projected at $950 billion, just shy of a trillion. Starting this year and looking out as far as projections go, the deficit–absent further policy changes–is only heading in one direction: Up. Why address chronic and rising deficits confronting the nation, when you can enjoy a talking point while it lasts?

2. Obama’s Regulations Weren’t Sensible, They Guarantee Future Bail-Outs for Big Banks, Paid for by the People

President Obama claims credit for crafting “sensible regulations” that will prevent another financial crisis as well as a new government “watchdog” to protect consumers. But the massive Dodd-Frank regulation statute actually entrenches the concept of “too-big-to-fail,” the very concept upon which bailouts are based. And the new “watchdog,” the Consumer Financial Protection Bureau, has exploited its unconstrained regulatory powers over virtually every aspect of consumer finances, including banking services, mortgages and credit cards—none of which had any connection to the financial crisis. The result has been higher costs for financial services and fewer options, which actually has inhibited the economic recovery and consumer welfare.

Read more about the disappointing State of the Union 2015 HERE.

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Illegal Alien Seated with Michelle Obama as Guest of Honor at SOTU

By Susan Jones. Ana Zamora, who came to the United States illegally, is among the 22 people selected to sit with First Lady Michelle Obama at tonight’s State of the Union address.

This is an honor bestowed on people who provide a human face for the liberal agenda that President Obama will lay out. Ana is the face of Obama’s executive amnesty, which conservative Republicans call an affront to the U.S. Constitution.

The White House describes Ana as a “letter writer, student, DREAMer.” She was brought here illegally as a child by parents who were themselves illegal aliens, and that’s exactly why she’s being honored by the White House.

If President Obama has his way, Ana and her parents will never be deported. They will be among the millions of “undocumented immigrants” who are allowed to stay in this country, something that is contrary to current law, but in accordance with directives issued by President Obama after Congress refused to enact his immigration plan. (Read more from this story HERE)

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Proposed Tax Hikes Part of Every One of Obama’s State of the Union Speeches

By Jason Russel. Proposed tax hikes on capital gains and banks [were] included in President Obama’s State of the Union address Tuesday . . . The announcement continues Obama’s tradition of proposing tax hikes in his six previous State of the Union addresses dating back to 2009. Here’s a list detailing Obama’s proposed tax hikes:

2015

Obama will call for a capital gains tax hike on high-earners from 23.8 percent to 28 percent, nearly double the 15.35 percent rate when he took office. He also wants to change the treatment of inherited capital gains so that inheritors end up paying more to the government. Banks with assets over $50 billion would also be hit with a new 0.07 percent tax on their liabilities, raising $100 billion over 10 years. These changes combine for a $300 billion tax increase over 10 years.

2014

Obama proposed closing tax loopholes to raise effective tax rates and using the revenue for infrastructure spending. He also wanted to close tax breaks that he said give “$4 billion a year to fossil fuel industries.” The 2014 State of the Union had the fewest references to taxes of Obama’s addresses so far. (Read more about the proposed tax hikes HERE)

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Ingraham: Obama Tax Proposal About Populist Theme For Hilary Clinton

By Ian Hanchett. Talk radio host Laura Ingraham said that President Obama’s tax proposals were about “trying to set a populist theme for Hillary Clinton” on Tuesday.

“He’s [Obama] getting his party ready for 2016. He wants to do what George W. Bush couldn’t do in 2008. George W. Bush couldn’t campaign…for the Republican nominee…They didn’t want him anywhere near the conventions” she stated.

Ingraham continued “Obama wants to be the anti-Bush when it comes to that, so he wants to set the themes for 2016. What he’s doing in this State of the Union speech is not thinking he’s going to get all this passed through Congress, he won’t…but he’s trying to set a populist theme for Hillary Clinton.” (Read more from this story HERE)

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Unions Poised to Win Delay of ObamaCare Tax in Budget Deal

Photo Credit: majunznkLabor unions are poised to score the delay of an ObamaCare tax in the bipartisan budget deal emerging in the Senate.

The bargain under negotiation would make small adjustments to the healthcare law, including delaying the law’s reinsurance fee for one year. The three-year tax is meant to generate revenue that will stabilize premiums on the individual market as sick patients enter the risk pool.

The tax applies to all group health plans, but unions argue it will raise their healthcare costs while providing them no benefit.

The reinsurance tax figured prominently in discussions at a recent AFL-CIO convention, where workers passed a resolution demanding changes to ObamaCare.

The White House recently denied labor’s top priority on ObamaCare, ruling that union health plans are not eligible for the new subsidies because they are already helped by the tax code.

Read more from this story HERE.

Government gone wild: IRS paying billions in fraudulent tax refunds

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The IRS is paying out billions of dollars in fraudulent tax refunds to identity thieves; a problem that the tax service’s inspector general told CNBC is a “growing problem” involving numbers that are increasing “exponentially.”

In a new report to be issued Thursday, the inspector general for the IRS says that tax thieves are stealing the identities of taxpayers and then filing bogus returns on their behalf and collecting fraudulent refunds as a result.

The inspector general estimates that the IRS could issue as much as $21 billion in fraudulent tax refunds over the next five years.

The scam is so rampant that thieves are apparently sending in false returns in bulk without even bothering to change the mailing address on the returns. The inspector general said it found one residential address in Lansing, Michigan that was the source of an astonishing 2,137 tax returns, and to which the IRS directed more than $3.3 million in potentially fraudulent refunds.

In another case, a single residential address in Chicago was the source of 765 tax returns, generating more than $900,000 in potentially fraudulent refunds, the report said.

Read more from this story HERE.