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Video: Senator Mark Warner Argues “there is no doubt at all that our tax system does not rank…on the more progressive side”

Sen. Tim Kaine: "why not have a tax code that basically treats income as income and applies the same tax rate to all kinds of income?"

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See below for video of the U.S. Senate Budget Committee hearing going on now, the subject of which is “Ending a Rigged Tax Code: The Need To Make the Wealthiest People and Largest Corporations Pay their Fair Share of Taxes.” Sitting on this committee are Senators Tim Kaine and Mark Warner, both of whom had some interesting thoughts to share. Here are a few highlights:

Sen. Kaine: “I think there’s a lot of big ideas about tax reform that are out there…Sen. Cardin has…introduced a comprehensive tax reform bill that would look at a consumption tax…I hope we might get into a big kind of…structural tax reform discussion…If you look at our tax code…if you gave it to a Martian and said, tell us what it says about us, the Martian would say, you know, I’ve looked at that tax code, and it says that you like investment a lot more than you like work, because the tax rates applied to wages and salaries are higher than they are applied to many forms of investment, carried interest, capital gains…I really like investment, but I like work every bit as much and I just don’t like the fact that we have a tax code that does not tax [investment] earnings at the same level as wages and salaries…It skews the way we structure transactions…it also has a significant disadvantageous…effect on lower-income people, because they don’t have the ability necessarily to get paid in ways that get the lower tax rate applied. So…why not have a tax code that basically treats income as income and applies the same tax rate to all kinds of income?”

Sen. Warner: “The notional idea that somehow we have this sort of aggressive tax system…When you look at the overall tax burden that low- and moderate-income Americans pay — when you add in sales tax…FICA…Medicare…gas tax…a host of other taxes and fees, there is no doubt at all that our tax system does not rank as a system on the more progressive side…Let’s not cherry pick our numbers here…I agree, we have spent close to $5 trillion in the last year, borrowed money. I think in the long run history will say it was appropriate to recover both from COVID and get the economy working…but that was exacerbated by the fact that we had spent $2 trillion in additional borrowed money on a tax cut that disproportionately did benefit people like me and businesses at the top…We now have a corporate tax rate the equivalent of 1.1% of GNP…that is the lowest of any in the G-7.”

 

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