A TAX CUT FOR THE REST OF US -- (Extensions of Remarks - May 02, 2006)
SPEECH OF HON. BOB FILNER OF CALIFORNIA IN THE HOUSE OF REPRESENTATIVES TUESDAY, MAY 2, 2006
Mr. FILNER. Mr. Speaker, the ``Tax Cut for the Rest of Us'' Act of 2006 (H.R. 5257) transforms the standard income tax deduction into a ``refundable'' standard tax credit. Doing so will not only simplify the tax code, but put more money into the pockets of poor Americans.
For 25 years, refundable tax credits--such as the Earned Income Tax Credit and the ``additional child tax credit''--have proven to be simple, effective ways to help the poor.
The logical next step is to transform the standard deduction and personal exemptions into a refundable standard tax credit (STC) of $2,000 for each adult and $1,000 for each child. The STC will provide all the poor with a small but badly needed tax credit, and give a tax cut to virtually everyone who chooses not to itemize their deductions.
>Transforming the standard deduction into a refundable tax credit will not eliminate poverty, but it will be an enormous benefit to the poor who were completely overlooked by the Bush tax cuts. The poor pay sales taxes, property taxes, and many other taxes, but because they do not pay very much in income tax, they have little to gain from tax simplification unless it includes something like the STC.
Transforming the standard deduction into a standard tax credit will give a tax cut to those who need it most. Now is the time to pass a ``Tax Cut for the Rest of Us.''
See the congressional remarks here.
Congressman Bob Filner (Democrat from San Diego, California) introduced “A Tax Cut For the Rest of Us”, (HR 5257), in the U.S. Congress on May 2, 2006. The preamble of the bill reads, “To amend the Internal Revenue Code of 1986 to provide a basic income guarantee in the form of a refundable tax credit for taxpayers who do not itemize deductions.
The Bill would transform the standard income tax deduction into a standard tax credit of $2000 per adult and $1000 per child. For the first time, it would give a “refundable tax credit” to everyone who filed an income tax return, even if the person had no private income. The current “Earned Income Tax Credit” provides a small refundable tax credit, but only to those who have some earned income. Anyone who earns zero is ineligible. The current “standard tax deduction” is “nonrefundable,” meaning that if people’s incomes are so low that their deductions are greater than their taxes, they pay no taxes, but receive no cash back either. The BIG bill would change that, allowing low-income Americans to receive up to $2000 in cash as a tax credit, and everyone else to receive the same amount off of the taxes they pay.
Al Sheahen has been working tirelessly with Filner and his staff for nearly two years to get this bill introduced. The Bill is based on a proposal written by Al Sheahen and Karl Widerquist presented at the 2005 USBIG Congress. The bill lacks a Republican co-sponsor, which makes its prospects dim in the current Republican controlled session, but Sheahen sees the bill as a long-term objective, around which to organize support and which might have a much better chance after congressional elections in November.
Read the full Bill text.