Friday, August 12, 2016

Morgan Griffith's Tax Reform Proposal

Apologies, Gentle Readers, for not posting this on Tuesday...but isn't it interesting enough to be a "weekender"? From U.S. Representative Morgan Griffith, R-VA-9:

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Ninth District Agriculture and a Better Way to do Tax Reform

Last week, among other visits to businesses and organizations in Virginia’s Ninth District, I had the opportunity to visit Hillwinds Farm, a local cow/calf operation in Dublin.

Not only are agriculture and forestry an integral part of our region’s economy and heritage, but agriculture is the largest industry in the Ninth Congressional District.

Hillwinds Farm is a cow/calf operation, and is also a bred heifer business. They take cattle from birth to slaughter, owning the cattle all the way through the process.

Tim Sutphin and his wife Cathy bought the farm in 1994, and since that time, have become respected leaders in the industry. Cathy is also well known as the associate director of 4-H Youth Development for the Virginia Cooperative Extension.

The Sutphins run about 800 cow/calf pairs in Pulaski and Bland Counties. Between all federal, state, and local taxes, the Sutphins pay approximately $185 per cow in taxes on their farm operations. That sure adds up.

During our visit, Mr. Sutphin indicated that we needed to improve our tax system.

I couldn’t help but nod my head in agreement when I heard this. I immediately thought of the reform plan being proposed by House Ways and Means Committee Chairman Kevin Brady (R-TX) as a taxes-related portion of the House’s “A Better Way” agenda. Like any proposal, the Brady proposal is not perfect. But it is far better than the complicated tax system we currently have.

As I have often said, when you have a daily publication devoted to reviewing tax court opinions and Internal Revenue Service rulings, your tax system is far more complicated than the average citizen could ever understand. And even those who love accounting have often indicated to me that the system needs simplification.

That is one of the reasons I have always supported the bill by Congressman Bob Goodlatte (R-VA) which would end the current tax code after six years. But if Chairman Brady’s proposal could meet that goal in the next year, that’s even better. This would force Congress to do the heavy lifting that must be done in order to fix our tax system.

Among Chairman Brady’s goals is to make it so the majority of Americans can fill out their income taxes on a form no larger than a postcard. That is an appropriate goal.

If I had it my way, the United States would be the best place in the world in which to do business (various organizations rate us differently, but I don’t know of any that currently rank the United States in the top ten). A new tax code could help with this.

Among other things, Chairman Brady’s “A Better Way to do Tax Reform” would work to make the tax code simpler, fairer, and flatter. It would also make it easier to create jobs, increase wages, and expand opportunities.

And rather than almost encouraging the shift of jobs overseas, as does our current tax code, Chairman Brady’s plan would reduce the tax penalty for those businesses wanting to bring overseas earnings home to America to invest. Other countries permit their companies to make money in foreign countries and bring that money home without significant penalty. Under our current system, American companies must pay a significant tax penalty if they bring foreign earnings back to the USA.

That’s right. If they earn $1 billion overseas, they can’t bring that money home to invest in new American facilities and new American jobs without the federal government’s tax system punishing them. I think we should let them bring their money home and create new jobs, new factories, and new innovations for the American people, not the people of China, India, Australia, etc.

As described in the policy paper for Chairman Brady’s tax plan, “American worldwide companies currently hold more than $2 trillion in capital overseas – funds that can be reinvested in America only after payment of a hefty U.S. tax bill.”

The “A Better Way” vision is about addressing some of our country’s biggest challenges in areas such as tax reform, poverty, national security, health care, cutting regulations, and restoring constitutional authority. I look forward to continue working and advancing some of these policies so Virginia businesses such as the Hillwinds Farm can continue confidently pursuing success.

If you have questions, concerns, or comments, feel free to contact my office. You can call my Abingdon office at 276-525-1405 or my Christiansburg office at 540-381-5671. To reach my office via email, please visit my website at www.morgangriffith.house.gov. Also on my website is the latest material from my office, including information on votes recently taken on the floor of the House of Representatives.
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Here's the 35-page PDF to which Congressman Griffith refers:

http://abetterway.speaker.gov/_assets/pdf/ABetterWay-Tax-PolicyPaper.pdf