By John P. Curley and Tony Howley
A few generations ago, many Americans would have balked at the statement “government and big business work together against the rest of us,” but in recent years, poll after poll shows that a majority of Americans believe it is true.
For decades, politicians and special interests in Washington, D.C., have made it true by working together to create loopholes and deductions in our tax code that enrich the well-connected few at the expense of the hard-working many.
Thanks to their efforts, our tax code has become a complex mess. Just to make sure they are complying with it every year, taxpayers and businesses spend more than six billion hours and nearly $200 billion. That’s a lot of time and money siphoned out of the American economy for no productive reason.
On top of its unfairness and complexity, the tax code is overly burdensome.
Individuals are forced to hand over a large portion of their hard-earned money to Washington — where politicians waste it — making it more difficult to save and invest or just break even.
Internal Revenue Service collections account for nearly a quarter of New Jersey’s Gross Domestic Product – more than $15,000 for every man, woman and child in the state.
And corporations in the United States are taxed at a higher rate — 35 percent — than anywhere else in the developed word. For those who cannot afford an army of tax lawyers to find deductions and credits or lobbyists to secure new tax benefits, this burden is crippling.
Larger companies often move overseas just to remain in business and they take jobs and economic growth with them.
Ours is increasingly becoming a system where, if you work hard and play by the rules, you cannot get ahead and that needs to change.
With lower tax rates, the hard-working residents of New Jersey can keep more of the money they earn. Those who own businesses can make productive investments that create jobs in our state. By eliminating deductions that mostly benefit the well-connected, we will foster a fairer tax system and, more importantly, a fairer society. That is good for you, good for me and good for New Jersey and America.
President Donald Trump and lawmakers on Capitol Hill are drafting tax reform legislation to bring real relief to American taxpayers and grow our economy.
New Jersey has two members of Congress in key positions – Sen. Robert Menendez serves on the Senate Finance Committee; Rep. Bill Pascrell serves on the House Ways and Means Committee.
These two panels will write the tax reform legislation. While Menendez and Pascrell are both in the minority, they still have a chance to play constructive roles as the legislation takes shape.
Sen. Menendez and his Senate colleague Sen. Cory Booker sounded a positive note last month, declaring, “We are confident that, by working together, we could modernize our tax system to increase working families’ wages, improve middle class job growth, promote domestic investment, modernize our outdated business and international tax systems and put in place sound fiscal policy that raises the revenue needed to meet the needs of our country.”
That sounds like there is hope they can find common ground in reducing corporate rates and closing loopholes that benefit the well-connected at the expense of the rest of us.
Rep. Pascrell and Sen. Menendez both voted against tax cuts for ordinary Americans in 2001 and 2003, so maybe the third time will be the charm.
We cannot afford for our lawmakers to treat this as business as usual. We need to take advantage of this historic opportunity to enact comprehensive tax reform.
John P. Curley is a Monmouth County freeholder. Tony Howley is grassroots director at Americans for Prosperity-New Jersey.