Politics & Finances

Congress at Odds Over Fair Tax Act, Abolishing Tax Code

Congress at Odds Over Fair Tax Act, Abolishing Tax Code

Most Americans would say that the current United States tax code is far from perfect and needs a number of reforms. To this end, new proposed Congressional legislation would abolish the existing code.

The Fair Tax Act, proposed by Representative Earl L. “Buddy” Carter (R-GA) would ban income, payroll, estate, and gift taxes, instead opting for a 23% flat rate sales tax nationwide.

Credit: Natalia Bratlavsky/Getty Images

The proposal would also eliminate funding for the Internal Revenue Service (IRS) after fiscal 2027.

Ironically, the IRS received $80 billion in additional funding as part of the Democrat-backed Inflation Reduction Bill. The funds were used to hire additional staff and upgrade technology ahead of the current tax filing season, which officially began on January 23.

The Washington Post shared Capitol Hill chatter regarding the divisive bill.

“You would actually get to see … what you’re actually earning every week in your paycheck,” bill supporter Representative Andrew S. Clyde (R-GA) said earlier this month.

Just this week, however, House Speaker Kevin McCarthy (R-CA) seemed to respond to a question about whether he supported the Fair Tax Act by curtly saying, "No."

Credit: Nora Carol Photography/Getty Images

Furthermore, in a joint press conference on Wednesday, January 25, Senate Majority Leader Charles E. Schumer (D-NY) and House Minority Leader Hakeem Jeffries (D-NY) publicly opposed the Fair Tax Act, saying it would result in "dramatic tax hikes for almost every American."

It's also worth noting that McCarthy is not the only Republican who opposes the bill.

Per The Hill, House Majority Leader Steve Scalise (R-LA) does not support the passage of the Fair Tax Act. “I don’t think it’s a wise thing,” Representative Don Bacon (R-NE).

For the moment, until the bill comes up for a vote, scattered GOP support of the bill is leading to a great deal of tension on Capitol Hill.

What do you think about the Fair Tax Act?

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Rebekah Barton

Rebekah Barton

Rebekah's search engine optimization career began completely by accident as a college student. Over the course of her career so far, she has "grown up" with the SEO industry, from writing content while juggling classes to managing her own teams of writers and overseeing SEO strategy in subsequent roles. She is excited to bring her passion for high-quality content to CountingWorks, Inc.

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Military Moving Expenses

The Tax Cuts and Jobs Act of 2017 (TCJA) suspended the moving deduction for all moves EXCEPT for members of the Armed Forces on active duty, required to move because of a permanent change of station. Relocations that result from a permanent change of station do not need to meet the normal distance or time tests for conventional moves.

Permanent Change of Station

A permanent change of station includes:

  • A move from home to the first post of duty when appointed, reappointed, reinstated, called to active duty, enlisted or inducted (Reg § 1.217-2(g)(3)(i))
  • A move from one permanent post of duty to another permanent post of duty at a different duty station, even if the member separates from the Armed Forces immediately or shortly after the move (Reg § 1.2172(g)(3)(iii)), and
  • A move from the last post of duty to home or to a nearer point in the U.S. in connection with retirement, discharge, resignation, separation under honorable conditions, transfer, relief from active duty, temporary disability retirement, or transfer to a fleet reserve, if the move occurs within one year or the termination of active duty or within the period prescribed by the Joint Travel Regulations promulgated under the authority in sections 404 through 411 of title 37 of the U.S. Code (Reg § 1.217-2(g)(3)(ii)).  

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