Establishment Republicans desperately trying
to secure the passage of Trade Promotion Authority (TPA), which would give
President Obama fast-track authority to secure congressional approval of at
least three secretive trade deals, are now willing to increase taxes on small
businesses in a way that would violate a pledge almost every Republican
Congressman has taken when elected into office.
To secure final passage through Congress of a
package that would include TPA fast-track authority—which would ensure
finalization of the secretive Trans Pacific Partnership (TPP), Transatlantic
Trade and Investment Partnership (T-TIP) and Trade in Services Agreement
(TiSA), among other deals—the House would need to pass the Trade Adjustment
Assistance (TAA) package that was necessary for Senate passage of TPA. The
House voted TAA down 302-126 with widespread bipartisan opposition to last
week, but House Ways and Means Committee chairman
Rep. Paul Ryan (R-WI) CR 58% F and his allies
in House GOP leadership have pledged that they will try to pass it again early
next week. The vote would potentially be on Monday, but more likely on
Tuesday—and if there is no vote by Tuesday, it’s unlikely that Ryan will be
able to succeed in his ploy to revive TPA.
TAA is a big government program usually
favored by Democrats—it increases the size and scope of government, and is
essentially viewed by Republicans as a welfare program—so their opposition to it
during Friday’s complicated and confusing House vote schedule was not
opposition to TAA as a specific concept, but opposition to the full Obamatrade
package, especially TPA.
House Minority Leader Rep. Nancy Pelosi
(D-CA) CR 9% F gave a blistering floor speech against the full Obamatrade deal,
causing a Democratic rebellion against TAA—and forcing Ryan to push Republicans
to vote for that part of the package.
TAA was originally supposed to be financed
with Medicare cuts – which sparked major outrage, and cries of hypocrisy in
what would have certainly turned into boldly negative campaign advertisements
against Republicans by Democrats this next cycle. But under pressure,
Republican leadership, mainly Boehner and Ryan, negotiated with Democrats
to remove the Medicare cuts from the financial backing of TAA and instead using
direct tax hikes by raising the penalties for misfiled taxes.
“A vote for Obamatrade on Tuesday is a vote
to give the IRS more power and more incentives to go after small businesses,”
said Curtis Ellis, founder of the Obamatrade.com website, in an exclusive
interview with Breitbart News.
Democrats overwhelmingly opposed TAA Friday
after Pelosi voiced opposition to giving President Obama fast-track trade
authority.
“So while I am a big supporter of TAA, if TAA
slows down the fast-track, I am prepared to vote against the TAA because then
its defeat, sad to say, is the only way that we will be able to slow down the
fast-track,” Pelosi said just minutes before the crucial vote. She concluded: “The
facts are these: If TAA fails, the fast-track bill is stopped.”
“It’s pretty outrageous what is called for in
this bill that Congress is going to vote on Tuesday – it literally doubles and
triples the taxes on small businesses,” explained Ellis.
Ellis spent hours researching this
legislation and explained to Breitbart News how it could impact small business
taxes if Congress passes the TAA during its vote on Tuesday.
“Small businesses that are already
over-burdened with IRS paperwork will be penalized even further if they make a
technical mistake on filing informational paperwork,” he said. “There’s a lot
of dishonesty going on when the bill is described as raising the fines on tax
violations. That’s dishonest because the fines aren’t for people who failed to
pay their taxes, the fines are on businesses that for no fault of their own,
they forget to fie a piece of paperwork telling the IRS how much someone else
owes on their taxes.”
“It’s outrageous that Republicans who
complain all the time – rightfully so – about the IRS’s overreach and over
burdening small business are actually increasing the incentive for the IRS to
spy on people – to spy on small businesses,” he added.
Essentially, as explained by Ellis, any time
a small business paid an independent contractor or freelancer a commission
or any tips, it must be reported to the IRS with a 1099 form, which a copy is
also sent to the contractor or freelancer. If the small business is late in
filing this form, then it is fined by the IRS. The proposal Tuesday, as it
stands, would double and triple these fines.
“It is the height of cynicism for Congress to
plan on paying for a welfare program for unions by increasing the penalties for
small businesses,” Ellis reacted.
President of Americans for Limited Government
Rick Manning agrees with Ellis about this increasing penalty being a tax
increase on small businesses.
“There is no question that raising the
penalty on small businesses who commit a paperwork error is a tax increase. It
is directly intended to raise revenues, so it can’t be considered anything
else. For Republican leadership to ask their members to vote to raise taxes on
small business to fund a union bailout that Big Labor doesn’t want is both
horrific policy and terrible politics,” Manning told Breitbart News.
This program was so unpopular with both
Democrats and Republicans that they removed it from Obamacare.
“This is very similar to one of the ways
Obamacare was going to be paid for – as Obamacare was enacted they were looking
for revenue to pay for it by increasing the penalties on small businesses who
failed to file 1099 forms – that was repealed because it was so unpopular,”
Ellis said. “Republicans led the charge in repealing it and now they’re the
ones leading the charge to once again increase the penalties in already
burdensome paperwork for the IRS.”
Therefore, the Republicans that voted for TAA
Friday, essentially voted to finance TAA at the expense of increasing small
business taxes – a direct violation of the Grover Norquist tax pledge, which
many Republican Congressmen took, pledging to the American public not to raise
any more taxes.
Norquist, President of Americans for Tax
Reform, a group for taxpayer advocacy to limit size of government, organized
the Taxpayer Protection Pledge. The pledge asks all politicians for both
federal and state office to sign the pledge, committing themselves to oppose
tax increases.
“This is clearly a tax increase – and it’s a
violation of Grover Norquist’s no tax increase pledge that most of these
Congressmen signed,” Ellis said. “This legislation assumes that there are small
businesses out there that will fail to file the 1099 form and will therefore
have to pay a fine.”
“It assumes small businesses will be forced
to pay the IRS and then it goes further and says ‘let’s make them pay more’ –
it doubles and triples the fines,” he argued.
Nearly every elected Republican in
America—with rare exception—has signed Norquist’s anti-tax pledge. As such, the
86 Republicans who voted to raise small business taxes through the TAA on
Friday most likely did as well.
ATR spokesman John Kartch told Breitbart News
he doesn’t think TAA as it’s structured now in the House is a tax and that it
does not violate the tax pledge—but that ATR is vehemently opposed to the
program and is recommending all Republicans vote against it. That means ATR is
in agreement with other groups from a more conservative perspective—albeit for
slightly different reasons—on this matter, and won’t back down to help
Obamatrade across the finish line.
“The Trade Adjustment Assistance (TAA) is,
like most government jobs training programs, a well intentioned, but flawed
program,” Kartch said in an email on Sunday night.
“Americans for Tax Reform opposes the TAA
program and any increase in funding for it. The TAA is tied to the Trade
Promotion Authority designed to facilitate trade agreements that reduce
tariffs. Tariffs are taxes. For most of our nation’s history our national
government was largely funded by tariffs. The increases in fines for not filing
1099s are not tax hikes. Tax increases come from changes in tax law. ATR
opposes the increase in the fines. Not every stupid move by government is a
tax. Civil asset forfeiture is a vicious misuse of government power — but it is
not a tax. Excise taxes are taxes and the bottom line of the drive to expand
free trade is that — even with silly ‘bribes’ to Democrats like the TAA –freer
trade driven by tariff reductions will reduce the taxes paid by American
consumers and increase the nation’s economic strength. As has happened with
every tariff reduction in our history.”
This is extraordinarily significant, since
Norquist and his organization did support the TPA portion of Obamatrade, but
the public opposition to its TAA portion means it’s unlikely any GOP votes will
budge if and when leadership brings up TAA again next week. In fact, if any
Republicans change their votes, they’re likely to switch from voting in favor
of TAA to against it so not to violate their pledge.
Ellis, Manning and Norquist are hardly the
only influential right-of-center figures opposing TAA.
“Regardless of how TAA is financed, it is a
wasteful ineffective program that undermines the virtues of free trade,” Dan
Holler, Communications Director for Heritage Action for America, told Breitbart
News.
Heritage Action and Club for Growth – a
conservative group – both oppose the TAA program saying it’s a wasteful welfare
program. Heritage Action scored against TPA and TAA, but Club For Growth
supported—like ATR—TPA but not TAA.
When TAA went down in the House last week,
only 86 Republicans voted for it—and they were joined by just 40 Democrats.
A whopping 158 Republicans joined 144
Democrats to oppose TAA. To pass TAA this week, the only way to truly keep
Obamatrade alive without having to go through a grueling conference committee
strategy that would likely lead to even more lost votes on both the House and
Senate side when they would vote on an eventual conference report, the
establishment would need to pick up 92 votes to get to 218.
That seems highly unlikely, given that the
widespread GOP opposition and the revelation that voting for this TAA portion
is technically voting for a tax increase. That alone is likely to keep the 158
Republican noes in their column and probably add GOP opposition as several of the
86 GOP ayes are likely to change their votes to oppose it as Democrat
opposition is getting stronger too. On Sunday, former Secretary of State
Hillary Rodham Clinton—the likely eventual Democrat nominee for president in
2016—urged Democrats to trust Pelosi and oppose granting Obama fast track trade
authority until a good deal is assured.
“The president should listen to and work with
his allies in Congress, starting with Rep. Nancy Pelosi (D-CA) CR 9%
Ryan’s office has not responded to a request
for comment in response to these revelations about Obamatrade’s tax increases.
http://www.breitbart.com/big-government/2015/06/14/gop-leaderships-latest-obamatrade-ploy-revealed-small-business-tax-hike-that-violates-gops-anti-tax-pledge/
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