ATR

Tax Bite Leaves Flacco Second Best Paid in NFL

Written by Matt Blumenfeld, State Policy Associate at Americans for Tax Reform. Posted with permission from Americans for Tax Reform.

As reported this week, Super Bowl MVP Joe Flacco and the Baltimore Ravens have agreed to a six-year, $120.6 million contract making the star quarterback the highest-paid player in NFL history, earning an estimated $20.1 million per year. But being the “highest paid player” and earning the most after tax pay are two very different things.

By choosing to remain a Raven, Flacco is now set to pay a combined marginal income tax rate of 51.98 percent. This overwhelming tax rate is composed of the federal, Maryland, and Baltimore County income tax rate, as well as the Medicare tax. And that’s excluding his “jock tax” liability for away games – play the Patriots at Gillette Stadium, pay Massachusetts income tax on earnings for that game - and other taxes levied against him such as Maryland’s property tax.

Given that Flacco is coming off of his best season, the franchise quarterback could have commanded a similar contract from any other team in the league while keeping a greater percentage of his contract. Four of the nine no-income-tax states have professional teams in need of the Super Bowl MVP’s caliber and skill.

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The Road To Tax Reform: More Potholes Than I Like

Some panels are off in nowhere, little rooms here and there. Other panels are in giant ballrooms, like the Marshall Ballroom, second largest to the Marriott where all the major speakers are, well, speaking. (Perhaps “blustering” is a better word.) And sometimes, those ballrooms were not full. But then maybe I got there early.

It was certainly an illustrious panel, which explained why it began to fill up shortly after it officially began. It was chaired by Grover Norquist himself, President of Americans for Tax Reforms, and the legendary proponent of the “No New Taxes” Pledge he encouraged (some on the left would say “forced”) politicians to take up. To his right was Lew Uhler , chair of the National Tax Limitation Committee, and to his left were Benjamin Powell of the Independent Institute and Phil Kerpen, Vice President for Policy, of Americans For Prosperity. I went because the subtitle implied there was going to be a debate between supporters of the Flat Tax, Fair Tax, a VAT, and maybe even 9-9-9—and that plan’s author, Rich Lowrie, did show up in the audience. But there really wasn’t any debate on that front.

And let’s face it, what kind of debate can we really have on taxes? Even the left admits that the tax code we have now is horrifically complex, prone to corruption and gaming the system. Though they disagree about “broadening the base and lowering the rates,” I don’t think any sane American, left, right, or center, can look at the miasma we have now and say, “Yeah, it works.” For whom?

There were some interesting points to be made, but ultimately I didn’t think the solutions that Norquist posed during question time were all that good. But let’s focus on the interesting first:

Conservative Opposition to Internet Sales Tax Getting Louder

The Senate moved closer to passing the Internet sales tax on Thursday. The chamber had already started debate on the measure, dubbed the “Marketplace Fairness Act,” but the vote last week bypassed any hope of a filibuster. Some conservative groups are increasing their efforts in opposition to the tax.

Americans for Tax Reform (ATR), headed by Grover Norquist, presented the constitutional case against the Internet sales tax. The case is in response to recent comments by David French, a lobbyist for the National Retail Federation, who said, “The industry is evolving very rapidly, and the law today is a 20th-century interpretation of an 18th-century document that is holding back the entire retail industry as it adapts to 21st-century consumer preferences and demand.”

“The Commerce Clause in the U.S. Constitution affirms that states cannot tax across their borders. Physical presence within a state’s boundaries is required for a state to be able to tax a business, a consumer, or a sale,” John Kartch wrote at ATR’s blog in response to French. “The Constitution is clear: a person or business must be physically present within a state’s borders in order to be taxed.  By suggesting the Constitution is outdated, Internet tax pushers align themselves with the rhetoric of far-left judicial activists.”

Americans for Tax Reform, ACLU Team Up for Internet Privacy

Internet spying

Should the government be snooping around you e-mails and cloud accounts? Given that there are constitutional safeguards in place to guarantee our privacy, one would think that the answer to this question would be obvious. But because federal laws haven’t been updated to cover online communication, law enforcement agencies haven’t bothered to obtain warrants for these searches. Additionally, efforts to pass SOPA, PIPA, and CISPA — bills that would have dire implications for online privacy and due process — are likely to resurface soon.

Grover Norquist, President of Americans for Tax Reform, and Laura Murphy, Director of the American Civil Liberties Union’s Washington Legislative Office, teamed up recently to discuss the issue of Internet privacy and to announce a joint effort to address this issue in an op-ed at Politico:

The essential elements of [the Electronic Communications Privacy Act] have not changed since 1986, and the courts have failed to keep pace, saying remarkably little about the Constitution’s application to new technology. Hence, the government can contend ECPA gives it the authority to ignore your privacy to an extent that would have shocked the framers of the Constitution.

Should spending be the primary focus of conservatives?

Grover Norquist

Grover Norquist, President of Americans for Tax Reform (ATR), has received a substantial amount of attention in recent weeks thanks to a handful of Republicans who have indicated that they are willing to go back on their pledges not to raise taxes on their constituents.

For years, the Taxpayer Protection Pledge, which is sponsored by ATR, has been a valuable tool in primaries as candidates frequently use it to show their commitment to fiscally conservative principles. As noted previously, the Taxpayer Protection Pledge simply states that the candidate will “oppose any and all efforts to increase the marginal income tax rates for individuals and/or businesses” and “oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates.” This pledge is not made to Grover Norquist, Americans for Tax Reform, or Republican leadership in Congress. It’s made to taxpayers inside that candidates district or state.

However, there are some that feel that there is too much of a focus on taxes and not enough on spending. Jonathan Bydlak, President of the Coalition to Reduce Spending, expressed this sentiment last week in a piece at National Review:

Raising taxes will not prevent economic problems

United States Capitol

Negotiations over the so-called “fiscal cliff” are back in full swing, but the White House and congressional leaders are no closer to an agreement on taxes and spending cuts. Just before Thanksgiving, House Speaker John Boehner told ABC News that he wants ObamaCare, President Obama’s signature domestic policy, put on the table during “fiscal cliff” negotiations. Republicans are also pushing for more transparency in the deal-making process, urging their leadership to put everything out in the open.

Boehner has been pushing the idea of pro-growth tax reform that doesn’t raise rates. That seems like a non-starter since White House and Senate Democrats have made it clear that they want to raise rates for higher-income earners. And unfortunately, some Republicans in Congress are getting anxious about a deal and are abandoning their pledge to constituents not to raise their taxes.

Raising taxes in this economy is a bad idea. Just two years ago, President Obama supported extending tax rates for another two years because he realized that the economy would struggle even more if tax rates suddenly changes. The economic climate isn’t much better today.

Michael Tanner, a senior fellow at the Cato Institute, recently explained that raising taxes on the rich isn’t going to balance the budget:

ATR finds new tax hikes from ObamaCare

The guys over at the Americans for Tax Reform have gone through the health care “reform” bill and found 18 different tax hikes to bring in billion in new revenues that won’t even pay the plan, ranging from the individual and employer mandates to an excise on comprehensive health plans and early health savings account withdrawals.

 

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