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On behalf of hundreds of thousands of FreedomWorks members nationwide, I urge you to vote “No” on H.R. 6275, the so-called Alternative Minimum Tax Relief Act of 2008. The title has a fairly broad use of the term “relief,” with taxpayers saving only $61.52 billion, as the total costs hidden in new taxes and accounting gimmicks far exceed that to the tune of $408.92 billion. For only another one year extension, the House has tacked on billions and billions in permanent taxes - extensions of current tax code don’t need a permanent tax increase under the guise of a “pay for.”
One provision to tax “carried interest” in effect taxes income twice. Once when capital gain revenues are taxed at the 35 percent corporate rate prior to being distributed to investors, as their incentive to help their funds perform better and now again, at a higher rate as ordinary income. This comes at cost to taxpayers of $30.98 billion over the next 11 years.
Another provision asks corporations to pay more of their taxes up front. While later, fourth quarter payments would be reduced, imagine asking anyone on a steady income to pay for the next two months of rent at once. Even with the understanding that the next month will already be paid for, most businesses would be hard pressed to muster that kind of cash up front. Of course, if someone can’t pay under this new tax scheme, the bill expands levy authority to property to ensure the government gets their pound of flesh even under extraordinary accounting circumstances.
Even as Americans are faced with record gas prices and struggle to meet energy costs, the bill denies the standard corporate tax deduction for the five largest oil and gas companies, other oil and gas producers will see their deduction frozen at 6% rather than the scheduled 9%. This is particularly misplaced spite aimed at a small group of manufacturers that far from helping us meet energy demands, further constrict the industry.
Rather than spend time pulling together more convoluted tax rules that burden business in perpetuity, Congress could solve the entire “AMT problem” by simply repealing it and making the overall tax code simpler, flatter, and fairer.
We will count your vote on H.R. 6275 as a KEY VOTE when calculating the FreedomWorks Economic Scorecard for 2008. The FreedomWorks Economic Scorecard is used to determine eligibility for the Jefferson Award, which recognizes members of Congress with voting records that support economic freedom.