If you're not crazy about the bipartisan U.S. Senate compromise that lets Democrat liberals keep the filibuster as an option to shoot down President Bush's judicial nominees, maybe your faith in bipartisanship will be restored, at least somewhat, by the Senate Finance Committee.
Led by chairman Charles Grass-ley, R-Iowa, and ranking member Max Baucus, D-Mont., the bipartisan panel is moving aggressively to get rid of one of the most odious and economically hurtful taxes on the books - the alternative minimum tax.
The AMT was passed in 1969 to ensure super-wealthy Americans didn't use loopholes, deductions and tax breaks in the tax code to avoid paying any taxes. The AMT guaranteed they would pay something - in fact, something fairly substantial.
The problem is that Congress didn't index AMT to inflation; consequently, every year more and more families find themselves ensnared in the AMT, kicked into higher tax brackets even though their real incomes aren't going up.
These new AMT taxpayers are not super-wealthy by any means. But they're sure making the government wealthy - to the tune of $600 billion over the next decade. With federal tax revenues rising rapidly as a result of a stronger economy, this is a good time to get rid of the AMT without having to find new sources of revenue.
Besides, the AMT is unfair to middle- and upper-middle-income taxpayers who should not be excluded from the tax code's tax breaks. If the Finance panel can't kill the AMT this year, they at least hope to get Congress to hold the number of people who have to pay the tax by extending temporary AMT relief, due to expire this year.
If that fails, taxpayers ensnared by the AMT will soar from more than 3 million this year to 20 million next year - and 35 million by the end of the decade. "It will catch a lot of people who have no idea they are going to be caught," a U.S. Treasury tax analyst told the committee.
Repealing the alternative minimum tax - along with the estate, or death, tax - is worthy of an energetic bipartisan effort. Let's all pull for Grassley, et al., to succeed.
© 2017. All Rights Reserved. | Contact Us