Masonry Magazine June 1996 Page. 13
The Congressional Report
Representative Philip M. Crane (R-IL)
Vice-Chairman, House Ways and Means Committee
Chairman, Trade Subcommittee
The Estate Tax...
It's Time To Bury It
Death and taxes the two undeniable certainties of human existence. While we cannot escape the former, we Americans can make tax time less taxing.
For most of my congressional career, I have advocated both the need to lower taxes as well as the need to simplify federal tax collection. As a member of the minority party, however, I was able to make only modest improvements in the tax code, such as playing a role in implementing indexation in the tax code in 1981. For the most part, mine was a voice in the wilderness of Washington. Fortunately, times have changed and the GOP is now in the majority after 40 years.
I have found that the American people typically have much different images of the tax man than many in Washington. Paying federal taxes or dealing with the Internal Revenue Service (IRS) seem to many Americans to be a fate worse than death. While for most taxpayers this may be an obvious statement, in the rarified air inside the Capital Beltway, too often taxpayers are forgotten. That explains why the statement by House Ways and Means Committee Chairman Bill Archer (R-TX) that he plans to "tear the tax code out by the roots" was truly revolutionary.
The U.S. Internal Revenue Code violates the principles which we learned from our parents and which we pass along to our own children. I taught my eight children to set aside a portion of their earnings to save and invest for the future rather than spending it all on instant gratification. However, as my children pointed out, if they spend their paycheck on instant gratification, the government taxes it only once. But by saving or investing their earnings, they explained, their money is taxed several more times. Thus, the federal government undermined my lesson in frugal money management.
Indeed, the U.S. savings rate ranks far lower than our major international trading partners. As a percentage of net national product, net national savings has averaged two percent. In the 1990's, personal savings, as a percentage of disposable income, has averaged less than five percent. While there are many reasons for this, the economic disincentives for savings and investment found in the tax code are certainly partly to blame for this lack of capital formation.
Congress is geared up to make big changes in estate taxes... This will effect family owned and inherited businesses
Continued on next page
MASONRY-MAY/JUNE, 1996 13