Mar 14, 2018

Defend Historic Tax Reform by Rejecting Corporate Welfare in All Forms, Starting with Tax Extenders

Post by Freedom Partners

In an article entitled “Special interest groups to defend favorite tax breaks,” the Washington Examiner writes that “[r]epresentatives from a wide range of industries are set to appear before a House panel Wednesday to convince members of Congress that their own pet tax breaks should be made permanent.”

The subsidies in question amount to billions of dollars in corporate welfare for favored industries, while forcing hardworking taxpayers to foot the bill. The article notes:

“The heads of two major free-market groups, Americans for Prosperity and Freedom Partners, wrote in a letter to the committee asking them to reject the extenders that ‘these carve outs were the products of a broken tax code riddled with the corrupting influence of corporate welfare and designed to allow Washington to pick winners and losers. They benefit the well-connected few at the expense of everyone else, they are unjust and unfair, and they underscore one of the major reasons why tax reform was so desperately needed in the first place.’”

The letter from Freedom Partners and Americans for Prosperity goes on to argue that there is no justification for these tax extenders in a post-tax reform world. The whole purpose of enacting a simpler, fairer and flatter tax code wasn’t to allow this type of corporate welfare to continue. It was to create a level playing field where average Americans and hardworking taxpayers don’t foot the bill for special interests under a rigged system.

READ THE FREEDOM PARTNERS AND AMERICANS FOR PROSPERITY LETTER TO CONGRESS

March 14, 2018

Dear Chairman Buchannan and Members of the Committee,

On behalf of our members and millions of grassroots activists throughout the country, Americans for Prosperity and Freedom Partners Chamber of Commerce write to urge you to stand strong in defense of the Tax Cuts and Jobs Act (TCJA) by opposing the renewal of billions of dollars of expired corporate carve outs – otherwise known as tax extenders – in the post-tax reform era.

While not perfect, the TCJA took significant steps to begin reducing the amount of corporate welfare in the tax code and started rightfully returning that money to the people who earned it. Adding billions of dollars in expired corporate welfare provisions back into the tax code after tax reform has passed would needlessly weaken the most significant legislative achievement in more than 30 years and send the wrong signal to special interests that Washington is back to business as usual.

Earlier this year when asked about tax extenders, Ways and Means Chairman Kevin Brady, told the Washington Examiner, “Our old tax code is over. … [I]t makes zero sense to trudge on with old provisions that served a different purpose, in a different tax code, during a different time.” Chairman Brady is right. The tax extenders currently under consideration, including those for industries like rum production, horse racing, and green energy, were wrong before tax reform and have no place in a post-tax reform world.

These carve outs were the products of a broken tax code riddled with the corrupting influence of corporate welfare and designed to allow Washington to pick winners and losers. They benefit the well-connected few at the expense of everyone else, they are unjust and unfair, and they underscore one of the major reasons why tax reform was so desperately needed in the first place. Furthermore, the tax relief and benefits that every sector will see as a result of the new tax law will be far greater than these outdated carve outs. There is no justification for renewing them.

We strongly urge the members of this Committee to stay true to the principles you stood for to get tax reform passed, build on the progress you’ve already made, and reject corporate welfare in all forms, starting with tax extenders. 

Nathan Nascimento
Executive Vice President
Freedom Partners Chamber of Commerce

Brent Gardner
Chief Government Affairs Officer
Americans for Prosperity

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