Statements and Speeches
Mar 03 2015
WASHINGTON – Today, Sen. Tom Carper (D-Del.), a member of the Senate Finance Committee, released the following statement regarding the committee's hearing on "Fairness in Taxation."
"I appreciate the topic of today's hearing as my own views on tax reform are guided by four principles: Is the proposal fiscally responsible? Will the proposal encourage economic growth and provide a nurturing environment for job creation? Does the proposal provide the certainty and predictability that families and businesses need to plan and grow? And last, but certainly not least, is the proposal fair?
"Defining fairness can be a contentious task, but in the context of today's hearing, I think it's important to take a look at whether the current tax code helps to create equal opportunities for all Americans. I believe the projected long-run trend that shows growing levels of income inequality is evidence that our current system is not meeting that standard.
"While it's doubtful that anyone can realistically answer the question of what the 'right' income distribution might be, I do believe that when there is too much of an imbalance between the top and bottom of the income ladder, then our economy, and our country, will be weaker in the long run.
"As we make an assessment on how our tax code is impacting inequality, we should consider the overall tax burden faced by families – including not just other federal taxes, like payroll taxes and tariffs, but also state and local taxes, like sales taxes. The overall tax burden faced by families is notably less progressive than it looks when we focus only on individual income taxes.
"Lastly, as we examine tax expenditures and loopholes in a conversation about how we can raise revenues to bring down the deficit, we should also be conscious of how certain tax preferences are contributing to income inequality. Many tax preferences are inefficiently designed, lose more revenue than is necessary, and—crucially, given today’s hearing—do not deliver benefits to those taxpayers who need them most.
"Many tax provisions are designed as deductions and consequently give a larger dollar-for-dollar tax benefit to taxpayers in higher income brackets than in lower brackets. In fact, most middle class and low-income taxpayers take the standard deduction, leaving them with no tax benefits from itemized tax breaks. Reducing and reforming tax expenditures can ensure a sustainable revenue base, while providing revenues to lower tax rates in a progressive way that, ultimately, brings more fairness to the tax code. I hope that is the type of tax reform we pursue on this committee."