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Boozman: Bernstein’s Zealous Support of Tax Hikes on Farmers is ‘Threat to Rural America’s Future’

WASHINGTON—U.S. Senator John Boozman (R-AR), ranking member of the Senate Committee on Agriculture, Nutrition, and Forestry, called the views of Jared Bernstein, President Biden’s nominee to serve as chair of the White House Council on Economic Advisors (CEA), a “threat to rural America’s future” and encouraged members of the Senate Committee on Banking, Housing, and Urban Affairs to reject his nomination.

“The administration’s attempts to pay for its priorities by increasing taxes on family farmers has been roundly rejected. The farm community rightly said ‘no’ to the president’s proposals to eliminate stepped-up basis, raise the death tax, limit like-kind exchanges and increase capital gains taxes.    

Now, President Biden wants the loudest cheerleader for this reckless tax and spend agenda to head the CEA.

Jared Bernstein’s praise of Green New Deal programs and his zealous desire to raise taxes on family farmers are a threat to rural America’s future.

Americans are struggling with historic inflation in food prices and farmers continue to see record-high input costs. Now is not the time to push policies that increase energy, fuel and other farm input costs as Mr. Bernstein would propose.

I encourage the banking committee to reject his nomination,” Boozman said.

On-The-Record: Jared Bernstein’s Reckless Tax & Spend Views

“My colleagues’ new paper goes through a lot of holes in the tax code through which significant wealth escapes taxation. Among the most egregious loopholes is one that allows wealthy people to pass along an asset to an heir who is not required to pay any tax on that asset’s appreciated value. That is, the wealthy person herself never paid tax on the asset’s increased value, and unless she sells it, the heir doesn’t incur a liability either. Even when the wealthy do sell assets, they’re taxed at a favorable rate, 23.8 percent vs. the top income tax rate of 37 percent. That’s another loophole that should be closed.

The estate tax also needs a lot more bite. The 2017 tax cuts raised its exemption levels to ridiculous heights: Between $11 million and $22 million of wealthy estates go untaxed (and those numbers are indexed to inflation). My colleagues point out that “fewer than 1 in 1,000 estates are expected to owe any estate tax.”
Most Wealth Taxation on the Rich is Essentially Voluntary. That Must Change,” Perspective by Jared Bernstein, The Washington Post, 11/26/19

“Thanks to Warren/Sanders et al, we're finally having a robust debate about taxing the huge wealth concentration that has evolved in recent decades, much of which escapes taxation, especially relative to paychecks.  How far can we realistically push wealth taxation? A lot farther than we have (which is almost nothing) but probably not to confiscatory rates. So, it's important to put a lot of options on the table. These include: --Mark-to-market (taxing unrealized gains) --Close loopholes, including step-up basis & new 20% pass-thru discount --Give the damn estate tax some bite --Close gap between cap gains/dividends & regular income rates --Collection enforcement!”
@econjared tweet thread,11/18/19

“Given that reality, why kill the estate tax? It hits only the richest top 0.2 percent of estates and squanders $240 billion over 10 years for no known growth effects (the estate tax was temporarily eliminated in the 2001 tax cut, and analysts found zip in terms of growth impacts). In fact, you should take the next step and end “step-up” basis, a provision that allows heirs to avoid capital gains taxes on inherited wealth. That would also bring in north of $200 billion over 10 years.”
Psst … Hey, Republicans … Wanna see some payfors?,” Perspective by Jared Bernstein, The Washington Post, 10/05/17

“So, let’s stop being distracted by the ‘fundamental reform fairy’ and start pursuing incremental reforms:… …End the ‘step-up basis’ provision by which the wealthy can pass capital gains on to their heirs tax free.”
We desperately need major tax reform! Or maybe not…,” Perspective by Jared Bernstein, The Washington Post, 01/28/16

“With that said, here's what I'd recommend to progressively raise more revenue, both on the individual and business side of the tax code. My goal is not to be exhaustive-there are many good ideas I don't explore, some of which are contained in the recent Obama budget-but to set forth more of a modular framework (as opposed to all-out "tax reform," a recipe for an endless, fruitless, muddled debate) and provide numerous examples of the type of ideas that fit neatly into it.

  1. Raise high-end tax rates. 
  2. Raise the estate tax. 
  3. End "step-up basis."

We're Going to Need More Tax Revenue. Here's How to Raise It,” by Jared Bernstein, The American Prospect, 06/13/16

“Why do all of these loopholes, deductions, and favorable rates exist? One explanation, often proffered with no supporting evidence, is that these complexities create incentives for growth. In some cases, such claims are prima facie indefensible. Step-up basis, for instance, encourages wealthy individuals to hold assets until death even if the gains from selling the assets might be more productively deployed elsewhere in the economy.”
Testimony of Jared Bernstein before the Joint Economic Committee, 04/20/16

“Various Types of Deferrals:  I still recall from a line from my public finance textbook from many decades back:  taxes deferred are taxes saved.  To the extent that tax expenditures shield various types of income — foreign earnings, bequests to heirs, debt-financing — from taxation, revenue is lost, inefficiencies can be generated, and fairness is violated.

For example, a sale of property that gained value since it was acquired would normally trigger a capital gains tax liability.  But if the property is exchanged for a “like-kind” property (or business), the tax liability is deferred.  Originally, like-kind exchanges protected small farmers trading acreage or barter transactions from taxation, but it has grown into a major tax avoidance scheme for sellers of large assets such as commercial real estate or oil wells.  Moreover, Marr et al point out that “…if the owner passes the property to an heir instead of selling it, capital gains tax is not just deferred but permanently eliminated, since capital gains become exempt from taxation once the individual who owns the asset dies.”  These authors also note that full repeal of this tax expenditure would raise about $18 billion over 10 years.”
Testimony of Jared Bernstein before the U.S. Senate Committee on the Budget, 03/05/13