December 06, 2006

Senators Bill Bradley and Ron Wyden Call forNew Tax Reform Push on Eve of Election

Celebrating the 20th anniversary of the 1986 Tax Reform Act,Senators see lessons for bipartisan reform

Washington, D.C.Twenty years after the last major tax reform act was signed into law, former U.S. Senator Bill Bradley (D-NJ) and Senator Ron Wyden (D-OR) today teamed up to urge President George W. Bush to join Congress in once again enacting real tax reform for the American people.Bradley, the original senator to push for tax reform and author of legislation that was a model for the 1986 Tax Reform Act, remains one of the nations leading advocates for a fairer and simpler tax code. Wyden is the author of the Fair Flat Tax Act, a tax reform package which calls for a simplified tax code to benefit middle-income Americans.The Tax Reform Act of 1986 was a bipartisan effort. Originated by Democrats in a divided Congress, the landmark legislation gained traction only after winning the support of Republican President Ronald Reagan. Bradley and Wyden made their call for an overhaul of the tax code two weeks before the decisive mid-term elections.We need to do more than just commemorate the anniversary of 1986 we need to pass legislation that makes our tax code simpler, fairer and taxes wealth just like it taxes wages, Wyden said. In 1986, we made a fresh start, but since that time, 15,000 loopholes and tax breaks have been added to the code three changes for every working day. Its time to have a tax code that people believe works for them, not special interests and lobbyists.Wydens Fair Flat Tax Act has many parallels to the 1986 legislation, including provisions to lower tax rates, broaden the overall tax base and treat work and wealth equally. If enacted, Wydens legislation would allow every taxpayer to file taxes on a simplified, one-page 1040 form, collapse individual tax brackets from the current six down to three and set one, flat corporate rate. It also would end the Alternative Minimum Tax for personal income taxes. By ending a number of corporate tax preferences, the legislation also would reduce the deficit by approximately $100 billion over the next five years, according to the Congressional Research Service (CRS).Also according to CRS, the Fair Flat Tax Act could provide tax cuts for middle-class families and for families with wage and salary income up to $150,000. Wydens plan provides higher standard deductions for every individual, ends tax provisions that favor unearned income such as capital gains and dividends over wage and salary income, and provides an unprecedented, refundable 10 percent tax credit for every taxpayers state and local taxes a direct benefit for the more than two-thirds of taxpayers who currently do not itemize their taxes.The need for tax reform is even more urgent today than it was 20 years ago. Working families are getting farther and farther behind, Wyden said. My intention is not to soak the rich. Its to allow everyone to accumulate wealth on the same playing field by using a tax code that doesnt take a degree in economics to understand.American taxpayers spend more than $100 billion on tax preparation each year. And the six billion hours each year that Americans are estimated to spend doing their taxes is greater than the combined annual working hours of every American employed in the manufacture of cars, computers, airplanes and steel in the United States. The Fair Flat Tax Act would free Americans of this burden by simplifying the way they do taxes.Senator Wyden announced his intention to reintroduce the Fair Flat Tax in the 110th Congress. Congressman Rahm Emanuel (D-IL) is the measures sponsor in the House of Representatives.