Tax-code revisions

House Republican released their blueprint for tax reform last summer. The plan:

Reduces six current incometax brackets to three: 33 percent, 25 percent and 12 percent.

Increases the standard deduction for singles from $6,300 a year to $12,000.

Elevates the standard deduction for married filing jointly from $12,600 a year to $24,000.

Scraps the Alternative Minimum Tax.

Cuts the corporate income tax rate from 35 percent to 20 percent.

Lowers the tax on passthrough small companies from ordinary income to 25 percent.

Slices the tax on capital gains and dividends to a maximum of 16.5 percent. never become law.”

Republicans contend that a major revision of the tax code would spark an economy that they say has recovered too sluggishly from the depths of the Great Recession. They maintain that a revision would simplify a tax code so complex that 90 percent of Americans need help in filling out their income-tax returns.

And they contend that lowering the corporate tax rate while also offering corporations a one-time low tax rate on cash brought home from accounts abroad would unleash new investment in U.S. plants and technology.

“The goal is to bring people together to pass pro-jobs tax reform,” said Sen. Rob Portman, R-Ohio, who talked about overhauling the code with Treasury Secretary Steven Mnuchin on Thursday. “I think this is the best way to get the economy moving and raise wages.”

But Democrats, many of whom acknowledge that the tax code has become mindnumbingly complex for ordinary Americans, warn that the tax reductions talked about by congressional Republicans would provide the wealthiest of Americans with a substantial tax savings while raising prices for average Americans.

They argue that a border tax would make the tax code more complex at a time when Republicans claim their goal is to make it simpler.

And they fear that such massive tax cuts included in the GOP plan would add trillions of dollars in new debt.

“It loses an enormous amount of money, and basically all of that money goes to the top 1 percent,” said Harry Stein, director of fiscal policy at the Center for American Progress, a Democraticleaning nonprofit group in Washington.

So to ease the fears of exploding the budget deficit, Ryan and other Republicans have backed the border tax, with Viard saying “the revenue impact of the border adjustment is pretty significant within a 10-year window. Over the long haul, it should be revenue-neutral.”

In Ohio, lawmakers are being tugged in competing directions. Rep. Steve Stivers, R-Upper Arlington, whose district is near Honda’s assembly plant in Marysville, said “the people who have a supply chain in the United States love it, and the people who have a supply chain outside the United States hate it.”

“The reason we haven’t done tax reform in 30 years is it is really complicated, and the last thing we want to do is screw it up and make prices rise,” said Stivers, who also is undecided about the border tax.

Portman, while saying that he has “some concerns” about a border tax, said he did not “want to be negative about any proposal out there because we should be encouraging reform.”

“But I don’t want to spend the next year squabbling about this,” Portman said. “I want to find a common ground.”