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1,062 views • January 11, 2023

House Will Vote on Bill to Abolish IRS, Replace Income Tax

NTD News
NTD News
The Republican-led House of Representatives will soon vote on legislation to abolish the IRS and replace the income tax code with a national consumption tax. Rep. Buddy Carter (R-Ga.) will introduce the Fair Tax Act (pdf) on Wednesday, a bill that would eliminate income, death, gift, and payroll taxes and replace the system with a national sales tax, a plan that proponents say would simplify the tax code and ends the need for the IRS. “Instead of adding 87,000 new agents to weaponize the IRS against small business owners and middle America, this bill will eliminate the need for the department entirely by simplifying the tax code with provisions that work for the American people and encourage growth and innovation,” Carter said in a statement on Tuesday. “Armed, unelected bureaucrats should not have more power over your paycheck than you do.” Carter had initially submitted the bill in January 2021, but it did not go anywhere. The original co-sponsors included several other GOP Congressmen, including Reps. Andrew Clyde (R-Ga), Jeff Duncan (R-S.C.), Thomas Massie (R-Ky.), and Gary Palmer (R-Ala.). Rep. Bob Good (R-Va.), another co-sponsor, asserted that it would bolster the U.S. economy since “it encourages work, savings, and investment.” According to Fox News, House Speaker Kevin McCarthy (R-Calif.) agreed to permit a floor vote on the legislation as part of an arrangement with the House Freedom Caucus to earn its support to become Speaker of the House. However, political analysts purport that the Fair Tax Act has little chance of becoming law as it would not garner enough votes in the Democratic-controlled Senate. Meanwhile, this comes soon after the GOP-led House voted 221-210 along party lines to reduce most of the $80 billion allocated to the IRS by Democrats in 2022. Experts say that it is unlikely that tens of billions of dollars would be rescinded since the initiative does not have enough votes in the upper chamber. The White House slammed (pdf) House Republicans, claiming that “their top economic priority is to allow the rich and multi-billion dollar corporations to skip out on their taxes, while making life harder for ordinary, middle-class families that pay the taxes they owe.” But new data from Syracuse University’s Transactional Records Access Clearinghouse (TRAC) found that the IRS has mostly targeted low-income taxpayers rather than millionaires and billionaires. “The taxpayer class with unbelievably high audit rates—five and a half times virtually everyone else—were low-income wage-earners taking the earned income tax credit,” the report stated. “[T]hey are easy marks in an era when IRS increasingly relies upon correspondence audits yet doesn’t have the resources to assist taxpayers or answer their questions.” Overhauling the Tax Code Over the years, many Republicans have proposed alternatives to the present income tax code, including a flat income or sales tax that would overhaul the current system. During the 1996 and 2000 Republican presidential nominations, conservative magazine publisher Steve Forbes resuscitated the idea of a low-rate flat tax system. A Steve Forbes for President 2000 campaign brochure stated: “Steve will strengthen the economy, protect your pay, and end the IRS as we know it with a new flat tax,” it read. “It’s Honest—No more loopholes carved out by lawyers, lobbyists and lifetime politicians. It’s Simple—You can fill it out on a postcard.” During the 2012 presidential election campaign, former House Speaker New Gingrich released a tax plan that would include a 15 percent flat tax for individuals, a 12.5 percent tax rate for businesses, and zero investment taxes. In 2015, Sen. Rand Paul (R-Ky.) revived the idea with the Flat and Fair Tax, a policy that would institute a 14.5 percent tax rate on all income with deductions and exemptions. His proposal would also substitute the corporate tax with a 14.5 percent business transfer tax. Several Republicans also pushed this tax policy during the 2016 primaries, including retired neurosurgeon Ben Carson, Sen. Ted Cruz (R-Texas
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