Yesterday the Center for American Progress released a report, “The Growing Consensus to Improve Our Tax Code” which “discusses some aspects of good tax policy that are endorsed on both sides and then identifies specific proposals for which consensus appears to be within reach.” While the NAM has long argued for comprehensive tax reform and is open to any and all efforts to find common-ground between both political parties as well as between the Congress and the Administration to achieve this critical goal, we take issue with the idea that the proposals included in this report is the common-ground that “could be implemented individually or as part of a package to advance other pressing economic priorities.”
This report, which simply identifies commonalities between the Administration budget proposals and base-broadening included in House Ways and Means Chairman Dave Camp’s “Tax Reform Act of 2014” discussion draft, ignores the underpinnings of both frameworks—lower tax rates in exchange for base-broadening. The report doesn’t however touch on the harm that would come from eliminating any or all of the “consensus” provisions absent a significant reduction in the corporate tax rate, or a shift to a competitive international tax system.
The reality is, comprehensive tax reform is essential to putting our still lagging economy on the fast-track to growth. There is broad agreement that our tax code is antiquated, uncompetitive and burdensome. However, there is not consensus on the the idea of using the revenues raised from base-broadening for any purpose other than reforming the tax code. Indeed, there are other points of consensus between the various tax reform proposals that have been floated in past years and that consensus should be used as the basis of a real effort to reform our tax code, not as a piggy bank for other ideas.