Panel Targeting Specifics on President's Tax Reform

WASHINGTON-The President's Advisory Panel on Federal Tax Reform has moved on to the next phase of its investigative process by inviting public comment on specific ideas for updating the tax code. "This request for ideas to reform the tax code marks a shift of our focus from defining the problems in the current code to considering options for reform," former Senator Connie Mack (R-Fla.), chairman of the panel explained. "We will be reviewing specific proposals for reform that have been offered in the past as well as new ideas that are submitted." The tax panel's recommendations are supposed to help simplify the tax laws, create a progressive tax structure recognizing the importance of homeownership and charity, and promote long-term economic and job growth. The panel also reminded interested parties that the proposals must be revenue neutral. Proposals to tax reform should include key components like the tax base, be it income, consumption or some sort of hybrid; exemptions, deductions, credits and exclusions; tax rate(s); distribution of the tax burden; charitable giving and homeownership treatment; collection methods; and treatment of businesses. Commenters should also discuss the impact of the proposal on the current system, such as simplicity, fairness, economic growth and competitiveness, and compliance and administration costs. The description of any tax reform proposal should include any special issues or considerations, such as tradeoffs that would be required, favorable/unfavorable treatment of particular industries or sectors within the economy, or the impact of transition from our current system to the proposed system. The deadline for this portion of the public comments is April 29. CUNA Vice President of Communications and Media Outreach Pat Keefe said that CUNA plans to submit a comment letter. The American Bankers Association and America's Community Bankers have used this venue to attack the credit union tax exemption, forcing credit union groups to defend their exempt status. The tax panel will hold its seventh meeting on April 18, 2005, in the Washington, D.C. area and will focus on the interaction of the Federal tax code with state and local tax systems. It will also look at the impact the tax code has on business investment, including the effect of cost recovery and depreciation rules. -scooke@cutimes.com