Yesterday, Charlie Rangel, Democratic chair of the House Ways and Means Committee, released an ambitious tax reform plan. According to Jeffrey Birnbaum in today’s Washington Post, the proposal is the opening salvo in whatever tax battles may come with a new president.
The proposal’s biggest change? Eliminating the alternative minimum tax—designed in 1969 to ensure that the nation’s very richest paid something no matter their wily accountants, but now potentially snaring 25 million tax payers—and recapturing that revenue with new taxes on families making more than $200,000 a year (a mere 4.5% of couples). Another change would essentially double the Earned Income Tax Credit, a boon to poor workers. These are changes that would affect many, many taxpayers, most of whom would end up with more money.
Now, the bill would also lower the corporate tax rate while eliminating several other corporate tax exemptions. (Over all, Rangel says the bill would have no net revenue effect.)
But the people Birnbaum calls on to assess the proposal’s impact focus on the changes to corporate taxation — and these talkers aren’t happy. Republican officials say Rangel’s plan would be the “mother of all tax hikes” and “would hinder America’s ability to compete in the global economy.” Birnbaum then turns to big business:
“There isn’t much relief there,” said R. Bruce Josten, executive vice president of the U.S. Chamber of Commerce. “This is going to be a problem for major corporations and also for a lot of small businesses, too.”
He added: “This bill sacrifices one taxpayer for the sake of another.”
Well what about those other taxpayers? In the article, no source—no tax expert, no professor, no low-income activist—outside Rangel speaks in praise of the bill. And Birnbaum, quoting from the AP, skips Speaker Pelosi’s endorsement of the package, leaving only words suggesting Rangel is a marginal figure to be damned with faint praise:
House Speaker Nancy Pelosi (D-Calif.) told the Associated Press that she expected differences of opinion even among Democrats. “In our caucus we’ll have our usual exciting, dynamic give-and-take on the subject,” Pelosi said.
The New York Times has yet to weigh in—David Cay Johnston, please!—but if this is an indication of how readers and voters will learn about what Birnbaum calls “a bitter election-year battle over the direction of U.S. tax policy,” the press is not setting up much of a debate.
CORRECTION, 10-29: As it turns out, I missed the Times’ take, which can be read here.