Republicans’ haste leading to flawed tax legislation

first_imgLikewise, the House version would stop allowing taxpayers to take a deduction for medical expenses that exceed 10 percent of their income.That would hurt middle- and working-class families.On matters small and large, Republican leaders have deliberately left no time for definitive congressional analysis of the economic and social fallout.Then they’ve summarily dismissed research by respected outside groups like the Tax Policy Center, which has found that the legislation decisively tilts to the well-to-do — by 2027, the wealthiest 1 percent would get 60 percent of the benefits, the group says — and that by 2027, tens of millions of middle-class families would pay higher taxes.The Senate bill has a provision for triggering automatic additional corporate tax cuts in the unlikely event that revenues exceed expectations.On Tuesday, Republicans inserted a so-called “backstop” provision that would limit tax cuts years from now if there’s a revenue shortfall.Details weren’t provided and it’s probably more of a vote-getting device than a substantive check on ballooning deficits. Sen. Ron Wyden, the panel’s senior Democrat who was amenable to a bipartisan tax-reform deal. Instead, the seven-term Utah lawmaker, under pressure to retire next year, went small, expensive and partisan.Stephen Shay, a Harvard University law school lecturer, tax lawyer and former Treasury official, has predicted that the rushed legislation “will be rife with undiscovered loopholes that increase the windfalls and scope of the deficit.”The Finance Committee did hold an Oct. 3 hearing, he noted, but it lacked substance and was “irrelevant except to permit the committee majority to say a hearing was held.”Overall, Shay writes, “There is a pervasive failing in the bill to introduce guardrails around substantial rate reductions that would effectively police the many new boundaries between rate differences that the bill creates.”Some provisions are included to score cheap political points. Conservatives targeted higher education, elite liberal institutions in their book, with taxes on the endowments of better-off colleges and on the tuition waivers graduate students receive for working as researchers or teaching assistants.There were no hearings that weighed the effect of these measures.University officials claim they would reduce research and cut financial assistance for middle-income students — at a time the federal government is cutting back in the same areas. Over the summer, Republican leaders brushed aside Sen. John McCain’s call for “regular order” to consider what soon became a failed effort to repeal the Affordable Care Act. Regular order involves dozens of hearings in which different views can be ventilated, along with deep analysis in a bipartisan spirit.Politically motivated haste has now produced an equally reckless tax effort.On a macro level, it’s not going to produce the promised economic growth.It can be expected to add at least $1.7 trillion to the deficit in 10 years and worsen income inequality.It’s no surprise the House legislated on a partisan basis; that’s long been the way it does business.But the Senate ought to be a different story.Sen. Orrin Hatch, R-Utah, who leads the Finance Committee, could have tried to work with Oregon Categories: Editorial, OpinionAny major tax bill has unintended consequences and hidden loopholes.But the current Republican tax effort just bristles with such potential miscues.It’s a slipshod product, legislated with minimal transparency and analysis and with a premium on partisan politics.The Senate is slated to vote very soon on a tax bill that’s similar to the one the House passed on Nov. 16.Both call for huge tax cuts, primarily for corporations and upper-income individuals, with little, sometimes nothing, for many middle-class taxpayers.Both parade as tax reform, but do little to reorganize the tax system as the last real tax reform did in a bipartisan measure passed in 1986.The legislation has been rushed so fast through a short-circuited lawmaking process that if it’s successful, many of the politicians who voted for it may find themselves shocked to discover what they’ve done. Sponsors contend that tax cuts benefiting the middle class that are slated to expire in 10 years actually will be extended by a future Congress.If that’s true, what they don’t acknowledge is that these future cuts would add even more to the deficit, bringing pressure for significant spending reductions.The only big available targets are entitlements like Social Security and Medicare, or military spending.That’s why there should be a clear path for deficit hawks like Republican Sens. Bob Corker of Tennessee and Jeff Flake of Arizona, or defense hawks like McCain, to send this bill back to the Finance Committee for real hearings, review, debate and analysis.That’s called regular order.Albert R. Hunt is a Bloomberg View columnist and former executive editor of Bloomberg News.More from The Daily Gazette:EDITORIAL: Urgent: Today is the last day to complete the censusEDITORIAL: Find a way to get family members into nursing homesEDITORIAL: Beware of voter intimidationEDITORIAL: Thruway tax unfair to working motoristsFoss: Should main downtown branch of the Schenectady County Public Library reopen?last_img read more

TPR orders former owner of retailer BHS to pay £9.5m into schemes

first_imgIn January 2018, the panel ruled that two contribution notices for a total of £9.5m be issued against Chappell. He appealed the decision but following a lengthy legal process his referral was struck out by the upper tribunal. The contribution notices against him were subsequently issued in August 2019.Nicola Parish, TPR’s executive director of frontline regulation, said: “We are pleased that the decision to issue two contribution notices to pay money into the BHS pension schemes stands.“This case illustrates how TPR is willing to pursue a case through the courts to seek redress for pension savers. It illustrates the situations our anti-avoidance powers were designed to meet and which allow us to protect the retirement incomes that savers deserve.”The Pension Protection Fund is responsible for obtaining the money from Chappell for the benefit of the pension schemes. Sir Philip Green, whose retail group sold BHS to Chappell in 2015, reached a settlement with TPR in 2017 to pay £363m to the BHS pension schemes. The Pensions Regulator (TPR) has published a determination notice detailing its decision to issue contribution notices for £9.5m (€11m) against Dominic Chappell regarding two pension schemes connected to the collapsed high street chain BHS.The issuing of the two contribution notices marks the end of TPR’s anti-avoidance enforcement against Chappell, which started in 2016. Retail Acquisitions Limited, of which he was a majority shareholder, bought BHS for the nominal sum of £1 in 2015 and the retailer fell into administration a year later.According to the information released by the regulator this week, the Determinations Panel decided that a series of acts were materially detrimental to the pension schemes, which included the acquisition of BHS, management decisions of the company, the appointment of inexperienced board members, the implementation of an inadequate business plan and the way money was extracted and distributed to Chappell, advisers, company directors and family members.last_img read more