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| December 6th, 2007 |
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Media Contact(s): Jared Whitley (202) 224-5251 |
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Printable Version |
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CONGRESS NEEDS TO "GET DOWN TO THE REAL BUSINESS OF FIXING THIS AMT"
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Washington - Today Sen. Orrin G. Hatch (R-Utah) spoke on the floor of the U.S. Senate on the need to reform the Alternative Minimum Tax (AMT). Highlights of the speech include:
Mr. President, we need to fix the Alternative Minimum Tax, the AMT. There is no argument in this chamber about that. If we fail to act, 25 million Americans might have to write checks to Uncle Sam for thousands of dollars.
So we agree on fixing the AMT.
But the devil is in the details, and I cannot support a plan that prevents a tax increase on millions of Americans by raising taxes on others.
Congress never anticipated having anywhere near this level of AMT revenues to begin with, so we should not be raising taxes permanently to make up for that phantom lost revenue.
We are well past time for serious action on the AMT. Almost three weeks ago, I came to the floor to discuss the financial and political ramifications of Congress’ failure to fix the AMT. We had a crisis then. It is worsening by the day.
Even if we were to patch the AMT today, the American people will suffer from our inaction. We have known that the AMT train was coming down the tracks all year. This failure to act is setting new standards for ineptitude.
Three weeks ago, the failure to patch the AMT was merely creating uncertainty for millions of Americans who would be subject to it if we dropped the ball. Three weeks later, these poor folks are barely the half of it. Now billions of dollars in tax refunds risk being delayed because of inaction. On November 26—eleven days ago—the Chairman of the IRS Oversight Board sent a letter to the Chairman and Ranking Member of the Senate Finance Committee.
His grim assessment of the situation is worth our review. The filing season is expected to start on January 14, but that date is now in jeopardy. IRS computer programs are set to process tax returns under current law.
The IRS cannot flip a switch and process millions of tax returns in January, when Congress changes the law on Christmas Eve. According to the IRS Oversight Board, the IRS would be able to start processing tax returns within seven weeks of the enactment of an AMT patch. So, if we were to enact an AMT patch today, tax filing season would start almost two weeks late.
That delay would lead to 6.7 million delayed tax returns and $17 billion in delayed refunds. What if we delayed the start of tax season one more week? Then we are looking at 15.5 million delayed tax returns, and $39 billion in delayed refunds. Push it back another two weeks—37.7 million delayed tax returns and $87 billion in refunds delayed.
Many Americans actually look forward to getting their W-2 in the mail. Their employer withholds too much money from their paycheck every year, and the W-2 allows them to file a return and get that money back. And now with electronic filing, Americans are able to get those refunds even more quickly.
Mr. President, Utahns depend on their refunds. They count on their refunds. Undermining that confidence is much worse than a lump of coal in a stocking. Mr. President, we are now in the Christmas season.
I am sure that the movie Christmas Vacation will be on television soon. That movie contains a lesson that we should all heed.
In that movie, Clark Griswold, assumes he is going to get his annual Christmas bonus. That Christmas bonus is as reliable as a weekly paycheck. And when that bonus did not come, he—flat—out—went—nuts.
The political philosophy of Clark Griswold is one that I would commend to my colleagues. It is one shared by the American people—if you mess with my family’s financial security, you better watch out. Mr. President, the Senate’s failure to patch the AMT in a timely fashion is going to delay millions of tax refunds. And we should not be surprised when the American people—like Clark Griswold—go nuts. Right now, Americans are likely making decisions about the Christmas gifts they are going to buy, at least partially, based on their tax refund.
They assume they are getting that tax refund. And they assume they are getting it on time. Further delay is no longer acceptable. Yesterday on the floor, Republicans were blamed for holding up passage of an AMT patch. That’s funny.
When Republicans were in the majority, we managed to pass an AMT patch early in the year, no later than May 11. We did it without permanent tax hikes to pay for one-year AMT fixes. We did it without including special interest giveaways. And we did it without delaying tax refunds. Democrats did tell us yesterday on the floor that they are the party of change. On the AMT at least, they seem to be succeeding. To fix the AMT they propose raising taxes. To pass important tax extenders they are raising taxes.
And their efforts have now jeopardized the tax filing season and refunds for the hard working Americans who depend on them. When times change, they sure do change.
We are about to have a vote on the AMT. I support AMT relief. I support AMT repeal.
But I will not support this fake tax relief. I am not the only one. The Democrats’ plan to fix the AMT with permanent tax increases ought to fail. And for good reason. We should not be paying for temporary tax cuts with permanent tax increases, nor should we be putting the economy at risk by passing unnecessary tax hikes.
When this episode is over, we need to get down to the real business of fixing this AMT so we can get Americans the tax refunds they expect and the tax relief they deserve.
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