This week, the Senate is expected to consider the Expiring Provisions Improvement, Reform, and Efficiency (EXPIRE) Act of 2014 (S. 2260) sponsored by Sen. Ron Wyden (D-OR) 10%. The EXPIRE Act would temporarily extend more than 50 expiring tax provisions pertaining to individual and business taxpayers and the energy sector through 2015.
The Senate’s tax extenders — and indeed the entire process surrounding the extension of expiring tax provisions — is one of the most egregious examples of Washington using its powers to prop up well connected interests.
The new year is usually reason for optimism, but that sentiment is going to be curbed by a new Obamacare tax starting January 1. Starting in 2014, Obamacare imposes a new tax on health insurance premiums by an additional 2 to 3 percent.
But don’t worry! Some will be spared (sub. req’d):
IRS regulations published in November excluded “any entity that is a self-insured employer to the extent that such employer self-insures its employees’ health risks.” Since about four of five employers with more than 500 workers and most union-negotiated health plans are self-insured, they are spared from the tax. So is insurance on behalf of “government entities,” such as original Medicare (but not privately run Medicare Advantage).
The Washington Post has a provocative headline this morning: “Poll: Majority of Republicans OK with revenue increases.”
After asking a series of questions about the debt, the Peter G. Peterson Foundation poll conducted by Global Strategy Group asked respondents: “If both parties were to agree on a long-term solution on the national debt, I would support it, even if it includes revenue increases that I don’t agree with.” 54-percent of self-identified Republicans agreed.
Word choice matters here, and the decision to use “revenue increases” as opposed to “tax increases” was intentional (every word in a poll is carefully chosen). Peterson’s spin on the poll was that everyone wants “a majority of voters in both parties are willing to give ground on key issues in order to achieve a much desired, long-term fiscal solution.” To arrive at those polling results, the questions whitewashed the policy prescriptions being discussed, i.e., tax increases.
Pollsters understand “tax increases” are unlikely to poll as well as “revenue increases.” This is not controversial.
Last night, the Senate moved to end debate on so-called Marketplace Fairness Act, more commonly known as the Internet Sales Tax. The bill would turn small, online businesses into tax collectors for states in which they have no real connection. Despite representing a state without a sales tax, Delaware Senator Chris Coons favors the legislation.
According to the Associated Press, Coons “supports the bill in part because tax-free Internet sales are eating into sales by Delaware retailers.” The article continues:
“In our region, we’ve long benefited from significant commercial sales from residents of Maryland, of New Jersey, Pennsylvania and elsewhere, who come to Delaware to shop because we’re a tax-free state,” Coons said. “Over time, the benefit of that has eroded as folks discovered that they could buy the same things online without paying sales tax from home.”
This is earmark-style parochialism at its worst. Coons wants to end tax-free shopping online so people will bring their tax-free shopping habits back to his home state.
So insular is Coons’ focus, he is urging “residents of Maryland, of New Jersey, Pennsylvania and elsewhere” to break their respective states’ tax laws. As the same AP article explains, “In many states, shoppers are required to pay unpaid sales taxes when they file state tax returns.”