Taxes on the Chopping Block in 2015

With a new, Republican-controlled Congress taking office in January, lawmakers will likely focus on reforming the federal tax code. While President Obama will have veto power, Joseph Lawler at the Washington Examiner contends that certain narrowly-focused tax bills could become law. Some of these include:

– Repealing the medical device tax. The 2.3 percent tax on medical devices ultimately hurts consumers, who are forced to pay for the tax in the form of higher prices. NCPA Senior Fellow Devon Herrick has also noted the negative impact of the tax on jobs. Lawler contends the Congress may have enough votes to override a presidential veto of the repeal.
– Reducing individual and corporate tax rates to 25 percent, down from 39.6 percent (the individual rate) and 35 percent (the corporate rate). A recent report by the NCPA noted how corporate tax reform could have a significant impact on workers; by abolishing the corporate income tax, real wages would rise 12 percent to 13 percent.
– Limiting the mortgage interest deduction. As Senior Fellow Pam Villarreal has noted, while intended to encourage home ownership, the deduction primarily benefits upper-income earners while encouraging excessive borrowing.
– Make tax returns simpler. Multiple Republican lawmakers have argued for getting rid of loopholes and tax breaks and reducing the need to itemize deductions so that tax returns are understandable and compliance is simple.

Lawler notes that Americans spend 6 billion hours complying with the tax code each year, with the average taxpayer spending 13 hours filing his taxes.

More From NCPA: