Tags: Furchtgott-Roth | Obama | tax | proposals

Furchtgott-Roth: Overlooked Obama Tax Proposals That Don't Pass Muster

By    |   Tuesday, 03 February 2015 01:56 PM

While much of the attention surrounding President Obama's tax proposals focuses on big issues, such as capital gains and dividend taxes, there are several largely overlooked proposals that are bad ideas, says Diana Furchtgott-Roth, a senior fellow at the Manhattan Institute and former chief economist of the U.S. Department of Labor.
  • "Forget deductions for charitable contributions linked to college sports ticket purchases," she writes in an article for MarketWatch. "Few provisions will cause more of an uproar than this: a contribution to the alma mater is not counted as a charitable contribution if it entitles donors to buy advance tickets for sporting events. The Obama administration estimates this will bring in $2.5 billion over 10 years.
  • "Stop saving, stupid." Obama proposes limiting retirement savings to an amount that can generate an annuity of $210,000 beginning at age 62. "No matter that this is hard to estimate, even for actuaries," Furchtgott-Roth says. "Too bad for you if you live in New York City or San Francisco, where $210,000 might not be enough to pay the rent, go out to dinner and make occasional trips to see the grandchildren," she adds.
"The good news is that with a Republican Congress that was elected on a platform of lowering taxes, none of these proposed tax changes are likely to become law. The bad news is that cooperation between the two parties seems as far off as ever."

To be sure, some experts say that Obama may be able to produce a compromise with Republicans in Congress concerning corporate tax reform.

"The basic outline of a deal on the most important component of corporate tax reform is falling into place," Ed Kleinbard, a tax law professor at the University of Southern California, tells Bloomberg.

The president has proposed cutting the top corporate tax rate to 28 percent from 35 percent currently. But he also seeks a one-time 14 percent surcharge on foreign profits and a 19 percent rate going forward. That plank has drawn strong opposition from Republicans.

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While much of the attention surrounding President Obama's tax proposals focuses on big issues, such as capital gains and dividend taxes, there are several largely overlooked proposals that are bad ideas, says Diana Furchtgott-Roth, a senior fellow at the Manhattan Institute.
Furchtgott-Roth, Obama, tax, proposals
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2015-56-03
Tuesday, 03 February 2015 01:56 PM
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