House Ways and Means Committee Chairman Dave Camp (R-MI) this afternoon released his much-anticipated tax reform plan, the Tax Reform Act of 2014.
Key highlights of the 979-page discussion draft include:
- Reduces rates and collapses the current tax brackets into two brackets of 10 percent and 25 percent for virtually all taxable income, ensuring that more than 99 percent of all taxpayers face maximum rates of 25 percent or less. The plan also reduces the corporate rate to 25 percent.
- Provides an inflation-adjusted standard deduction of $11,000 for individuals and $22,000 for married couples.
- Increases the child tax credit to $1,500 per child, adjusts it for inflation going forward, and expands the number of families that can claim the credit.
- Requires the IRS to develop a simple tax return to be known as Form 1040SR, for individuals over the age of sixty-five who receive common kinds of retirement income, like annuity and Social Security payments, interest, dividends, and capital gains.
- Mandates that “too big to fail” financial institutions pay a quarterly 0.035 percent tax on their worldwide consolidated assets in excess of $500 billion.
- Repeals more than 220 sections of the tax code, cutting the size of the code by 25 percent.
Click here to download Camp’s tax reform plan.
Here’s what others have written this afternoon about Camp’s proposal:
Dozens of tax breaks would end in Republican’s revamp plan
Richard Rubin of Bloombergwrote: “The proposal includes new limits on breaks for health insurance, retirement savings, mortgage interest, and private equity managers’ carried interest. The plan would repeal breaks for student loan interest, moving expenses, accelerated depreciation, and state and local taxes.”
Analysis of Chairman Camp’s proposal for tax reform, part 1: Individual tax reform
Forbes contributor Tony Nitti wrote: “Before we begin our analysis of the plan let me start by saying that while I clearly admire Chairman Camp for his tireless push to simplify the industry in which I ply my trade, I’d be remiss if I didn’t point out the irony that in the tax world, even a proposal for ‘simplification’ stretches to nearly 1,000 pages.”
Boehner on tax reform: ‘Blah, blah, blah, blah’
“‘Blah, blah, blah, blah.’ That was House Speaker John A. Boehner's response Wednesday to a question about the details of a proposed overhaul to the nation's tax code, a subject that he says he's happy to have Congress discuss even if he's steering clear of specifics,” wrote Ed O’Keefe of the Washington Post.
Democrats get election year fodder in Dave Camp tax plan
Brian Faler of Politicowrote: “Dave Camp is giving Democrats a big, fat election-year gift. His long-awaited tax reform bill released on Wednesday includes something to offend seemingly everyone: manufacturers, the poor, Wall Street banks, governors and deficit hawks.”
Tax plan has something for everyone (to hate)
Michael Crittenden of the Wall Street Journalwrote: “All in all, just what you'd expect from a serious, carefully drafted tax overhaul. Said Douglas Holtz-Eakin, a former adviser to GOP presidential candidates: ‘Everyone's mad at him.’”
Camp’s bank tax shows Wall Street still in doghouse
Another article from the Wall Street Journal, this one written by Ryan Tracy: “Mr. Camp’s bill would also limit another tax benefit for big banks: the ability to deduct premiums they pay for federal deposit insurance. Banks with greater than $50 billion in assets could make no such deductions, while banks with between $10 billion and $50 billion in assets would have their deductions reduced. That provision would raise revenues by an estimated $12.2 billion over ten years.”
Check out “Bramwell’s Lunch Beat” tomorrow for other articles on Camp’s tax proposal that may be of interest.
About Jason Bramwell
Jason Bramwell is a staff writer and editor for AccountingWEB. He has nearly 20 years of experience in print and online media as a journalist and editor.