Is the national sales tax bill DEAD? Top Republicans say they WON’T back it

Top Republicans have brushed off the idea of ​​doing away with the IRS and replacing the federal income tax with a national sales tax.

House Speaker Kevin McCarthy told reporters on Capitol Hill this week that he would not support the Fair Tax Act, a bill proposed by some in his caucus that would impose up to 30 percent tax on all sales.

When asked if he would put the bill to a vote, McCarthy said it “should go through committee.”

A vote on the bill was reportedly promised as part of the deal to get the gavel from McCarthy the Speaker.

The bill, introduced by Rep. Buddy Carter, R-Ga., has amassed 30 co-sponsors to date. It would do away with all income taxes, payroll taxes, estate taxes, and gift taxes in favor of the single flat tax that would make the IRS obsolete.

The bill, introduced by Rep. Buddy Carter, R-Ga., has amassed 30 co-sponsors to date. It would do away with all income taxes, payroll taxes, estate taxes, and gift taxes in favor of the single flat tax that would make the IRS obsolete

But Majority Leader Steve Scalise isn’t on board either — instead telling The Hill that he favors making the tax cuts of President Trump’s 2017 bill permanent.

“We’ve simplified the code and removed a lot of loopholes, which is why I want us to keep focusing on the fairness and simplicity of a tax code,” Scalise argued.

He also seemed to doubt whether the bill would make it to the House of Representatives.

“Any member can file a bill,” Scalise said. “That doesn’t mean the bill will pass committee or word.”

Majority Leader Steve Scalise

Speaker of the House Kevin McCarthy

House Speaker Kevin McCarthy and Majority Leader Steve Scalise told reporters they do not support the Fair Tax Act

“That’s why we went back to normal order,” he added. “We have a lot of the [former Speaker Nancy] Pelosi [(D-Calif.)] rules, where a bill is written in the Speaker’s office and dumped on everyone. You know, take it or leave it. That’s not how we do business.’

Proponents of a consumption tax argue that the system allows Americans to choose how much to pay in taxes by choosing how much to spend — thus encouraging saving and investment.

The bill came on the heels of a vote to reclaim $72 billion of about $80 billion in additional funding Democrats gave to the IRS last Congress, much of which is planned to hire 87,000 new IRS agents. .

The IRS’ budget request for fiscal year 2022 was just $13 billion.

The Congressional Budget Office estimated that the GOP-approved bill would add about $114 billion to the deficit.

“This transforms US tax law from a mandatory, progressive and complicated system to one that is completely transparent and unbiased that does away with the IRS as we know it. It’s good for our economy because it encourages work, savings and investment,” said Rep. Bob Good, R-Va., a co-sponsor of the legislation, said in a statement.

According to a 2022 estimate by the American Action Forum, Americans spend 2.6 billion hours and $209 billion a year filing taxes in the U.S. and is much more expensive and time-consuming than in other advanced economies.

Larry Kudlow, former director of Donald Trump’s National Economic Council, called the plan a “crappy idea” when interviewing McCarthy this week.

In a recent speech, Biden scoffed at the idea: “National sales tax, that’s a great idea… go home and tell your moms, they’ll be really excited about that.”

Grover Norquist, a tax cut advocate, told Semafor that the plan amounted to a “political gift to Biden and the Democrats.” Liberal lawmakers have enjoyed the proposal.

“This so-called fair tax plan is the craziest yet. It’s a real doozy,” Senate Majority Leader Chuck Schumer told reporters as he appeared with House Democratic Leader Hakeem Jeffries at a new conference devoted to defeating the bill. “Simply the biggest lollapalooza I’ve ever seen here.”

Democrats have tried to divert attention from the fact that Americans could keep all of their paychecks and focus only on rising costs.

The Republican tax plan would increase the cost of buying a home by $125,000. It would increase the purchase price of a car by $10,000. It would increase your average grocery bill by $3,500 a year at a time when people are already concerned about the high price of groceries. How can they do this?’ Schumer said.

“Things like eggs are already too expensive, but the Republicans want to add another $1.50. The plan would make a gallon of milk cost an additional $1.70 more,” he added.

“It makes you wonder who is in a dungeon, a lab, a basement hatching these extreme ideas to cram them down the throats of the American people,” Jeffries added.

When asked about the GOP proposal, centrist Senator Joe Manchin asked reporters at the Capitol, “Are you serious?”

The Tax Policy Center, part of the leftist Brookings Institution, said the proposal would amount to a tax increase for 80 percent of Americans and a tax cut for the wealthiest 20 percent.

When asked about Democratic laughter over the bill earlier this month, Carter told, “Our current tax system is a joke, and the IRS is the butt of the joke. The only people who stand to gain from maintaining a hulking IRS are the bureaucracy-loving Democrats in Washington, who want armed, unelected agents to have more control over your paycheck than you do.”