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FOR IMMEDIATE RELEASE
CONTACT: US PIRG
Nicole Tichon, Tax and Budget Reform Advocate(202) firstname.lastname@example.org
New House Rules May Hamstring Deficit Reduction
WASHINGTON - January 5 - Statement of U.S. PIRG Tax and Budget Reform Advocate Nicole Tichon on the new rules package to be considered today in the U.S. House of Representatives, specifically the provisions around the budget.
"While the new Congressional leadership's focus on federal budget deficits is admirable, ‘cut-go' provisions that exempt special interest carve-outs and corporate tax loopholes from the accounting process will only handcuff the ability of Congress to seriously tackle the budget problem.
"Further, the specific provisions barring discussion of wasteful handouts through the tax code -- handouts that were fought for and won by armies of narrow interest lobbyists -- remove from consideration a significant number of solutions that have broad public support.
Under the proposed rules:
- Attempts to shut down off-shore tax havens cannot be considered in discussions of deficit reduction. These havens cost taxpayers an estimated $100 billion per year and go to those who benefit from access to American markets, workforce, security and infrastructure but pay little or nothing as they ship profits overseas.
- Tax expenditures that flow to BP, Exxon and others in the oil and gas industry are off the table. These tax breaks provide unnecessary incentives as they largely underwrite activities the companies would willingly do on their own.
- Ill-advised loopholes carved out of the tax code that let multi-millionaire hedge fund managers pay dramatically reduced tax rates - far less than the average American - are exempt from discussions on solving our deficit problem. This loophole has been criticized across the political spectrum from Paul Krugman to Pete Peterson.
"The proposed new rules have the dangerous potential to undo recent bipartisan progress, including recommendations of the Fiscal Commission to close a number of tax loopholes. Some of the few moments of bipartisan agreement in recent memory can be attributed to the need to end special interest influence and reform the tax code. These rules may in fact thwart the rising awareness that wasteful spending through the tax code is no different than wasteful spending through the appropriations process.
"Closing ill-advised tax loopholes, ending special interest carve-outs and corporate tax breaks do not equate to tax increases. Turning a blind eye to this type of waste and forbidding these common sense reforms has the potential to undermine any serious steps toward a sustainable federal budget.
"We urge the House to reject these provisions."