Chambliss joins Linder

Published 3:46 pm Tuesday, December 6, 2005

in tax relief proposal



Staff Reports



ATLANTA — U.S. Senator Saxby Chambliss, R-Ga., and U.S. Representative John Linder, R-Ga., are leading a bipartisan and bicameral effort to provide what they term is tax relief to all Americans.

Chambliss and Linder discussed their legislation at a news conference Monday at the state capitol.

Referred to as the FairTax (S. 1493 and H.R. 25), this legislation would shift the federal government’s method of funding operations from income-based taxes to a personal consumption tax, Chambliss spokespersons said. It would repeal all federal personal income taxes, corporate income taxes, payroll taxes, self-employment taxes, capital gains taxes and gift and estate taxes and replace these taxes with a revenue-neutral 23 percent sales tax on all retail sales of new goods and services, they said

“The current tax code is ridiculously complex and desperately needs a major overhaul,” Chambliss said. “As April 15th approaches, it’s painfully clear that simply tinkering with the current system is no longer an option. The FairTax is a fairer, simpler tax code that allows every American the freedom to determine his or her own priorities and opportunities.”

Linder thanked the senator for introducing a companion bill in the Senate saying that this marked “a major step toward reforming our broken tax system.”

“I’ve introduced the FairTax in the last three Congresses and I am more encouraged than ever that we are even closer to making it a reality,” Linder said. “There is a desire to get rid of the intrusive IRS and implement a system that will generate economic growth and help create new jobs.”

“Having served as Chairman and President of the Tax Leadership Council, replacing the tax code has been my number one economic issue for over a decade. Getting the burden and the complexity of the tax code off of American workers and American companies is way overdue. For years, there has been a lot of lip service in Congress about replacing the tax code and shutting down the IRS, and I am glad to see U.S. Rep. Linder and Sen. Chambliss are being aggressive in passing this legislation,” said Herman Cain, Republican U.S. Senate candidate.

“The proposed legislation, H.R. 25 (S. 1493) will help unleash the full economic potential of the United States. The FairTax will generate the same amount of revenue as the personal income tax, corporate income tax, payroll tax and death tax combined. Companies will no longer be double taxed and this will help job growth and business expansion. American companies will be more competitive in the global market. The poor will be untaxed up to the poverty level because of a pre-bate mechanism already written into the legislation,” Cain said.

“The average American family will receive a 30 percent increase in take-home pay and pay no more than 23 percent on new retail sales and services. Unlike our current system, the American people will not be penalized for working hard. They will be taxed on what they spend, not on what they earn.”

The two lawmakers outlined eight principles that they believe should be considered when debating tax reform, all of which the FairTax addresses: Fairness, simplicity, voluntary, transparency, border-neutral, industry-neutral, strengthens Social Security and manageable transition costs.

Chambliss said the tax must be easy to understand for all Americans — no matter one’s education, occupation or station in life. It must not be coercive or intrusive. There must be no “hidden” taxes, he said. Exports must be unburdened by any tax component in the price system, he said, while imports carry the same tax burden at retail as our domestic competition.

The tax must be neutral between businesses and industries. Fundamental reform must address the long-term solvency of Social Security. Implementation must not be costly or difficult, and the tax must protect the poor and treat everyone else the same.

“No exemptions, no exclusions, no advantages,” Chambliss said.