SENATE BILL: Income Tax Reform Act of 2014 (Failed)

[🐒Gods of Prosperity🔱🐲💸]

What are we going to do with tax credits?  Are we going to get rid of those also?

While I could support some limitations on it, I don't support removing the charitable deduction.  Taxation limits the amount of money that a person has available to give to charity. So if we don't want to discourage giving, the deduction makes sense.

[🐒Gods of Prosperity🔱🐲💸]

What are we going to do with tax credits?  Are we going to get rid of those also?

While I could support some limitations on it, I don't support removing the charitable deduction.  Taxation limits the amount of money that a person has available to give to charity. So if we don't want to discourage giving, the deduction makes sense.

The trouble with that argument is that we could say this about anything. "Taxation limits the amount of money that a person has available to give to X. So if we don't want to discourage X, the deduction makes sense." It's the primary justification given for virtually every deduction on the books.

There are lots of things that policymakers want to encourage: Consumer spending, savings, home ownership, education, energy savings, etc. Yet we're dumping all of these - as long as they're deductions and not credits, at least - and in many cases, I support this. What makes charitable giving different?

One difference is that those other things you mentioned are that people spend money on for themselves and their family, that they can find some economic utility in quite aside from the deductions and credits. I don't mean that people won't give without this, but there's not the same economic incentive there on the other side to balance the cost of spending a significant portion of one's after-tax income.

Basically though, I think it comes down to what we are going to prioritize and value.  We tend to have a different reaction to hearing that a millionaire has given 40% of his income to charity than if he spent 40% of his income on a house.  Maybe given the jobs created by that spending we reacted differently too much, but it's not entirely wrong, because the societal benefit is more direct, assuming it is a worthwhile cause.  I value having voluntary, independent social institutions out there doing good in our communities, and so I don't believe we should be burdening the ability of people to contribute. 

[🐒Gods of Prosperity🔱🐲💸]

Gentleman, this bill is our starting point.  Duke and I fully expect this bill will be different by the time a final vote is presented.  However, with five empty slots two days ago, and nothing to introduce except TNF bills, no offense, at least we're debating something. 

Let's get word from our GM, and take into account our already extensive programs and try and understand where we are.  Does everyone here even fully understand the laws that we've passed that are relevant?

Oh, and I'm removing TNF's amendment, for the record. 

I think most of the complications of the tax code we've created by legislation, as opposed to adopted from US, are in the form of tax credits.  I think I listed the ones we had at one point when I was GM, though we've made more since then I'm sure.

[🐒Gods of Prosperity🔱🐲💸]

Nay