Business

Lew Says Congress Should Turn Efforts Toward Business Taxes

Published

10 years ago

January 22, 2015

In this Feb. 13, 2013, file photo, Jack Lew testifies at his confirmation hearing to be the new Treasury Secretary in Washington. (AP Photo/J. Scott Applewhite)

STEPHEN OHLEMACHER, Associated Press

WASHINGTON (AP) — The Obama administration is pushing Congress to simplify federal business taxes after Treasury Secretary Jacob Lew said Democrats and Republicans are too far apart to agree on sweeping changes to taxes paid by individuals and families.

Lew said the Obama administration has no interest in lowering the top income tax rate paid by individuals, a key goal for Republicans. He said there are more areas of agreement on business taxes.

“I don’t think that there’s any advantage in pretending that there aren’t big disagreements on the individual tax side,” Lew said at a forum hosted by the Brookings Institution, a Washington think tank. “We had a national debate just two years ago about the top rate. We’re not looking at the kind of negotiation to go back to lower the top rate.”

“While our views on individual tax reform may be far apart,” Lew added, “there is a broad set of business tax reforms on which we should be able to agree.”

Lew’s comments came after President Barack Obama proposed raising taxes on the rich and using some of the revenue to finance tax breaks for the middle class. In his State of the Union address this week, Obama called his approach “middle-class economics.”

Congressional Republicans panned the speech, saying there is no way they would use their majorities in the House and Senate to enact tax increases.

“This White House is more about redistribution and populist class warfare than about actual bipartisan tax reform,” said Sen. Orrin Hatch, R-Utah, chairman of the Senate Finance Committee.

Congressional Republicans said they were disappointed the Obama administration isn’t pushing to simplify taxes for individuals. They noted that the vast majority of small business owners report business income on their individual tax returns.

Still, key Republicans said they would welcome more talks about business taxes.

“We’re going to keep talking. We’re going to exhaust the possibilities of seeing where the common ground exists and see if we can get something done,” said Rep. Paul Ryan, R-Wis., chairman of the tax-writing House Ways and Means Committee.

“We do have big differences of opinion and our next step is to explore the areas of common ground if and where they exist,” Ryan said. “I’d like comprehensive tax reform and I think it’s important that you make sure that small businesses don’t fall by the wayside. And that is very important to us, and so we’ll see if we can complete the circle.”

Hatch and Sen. Ron Wyden of Oregon, the top Democrat on the Finance Committee, have formed five bipartisan working groups to work on various aspects of the tax code, with the goal of developing comprehensive legislation by the end of the year.

“I don’t want to just release a framework or a proposal that doesn’t go anywhere,” Hatch said in a speech this week. “My only goal when it comes to tax reform is to make new law.”

Democrats and Republicans alike agree that the nation’s tax laws are too complicated for businesses and individuals, filled with too many exemptions, deductions and credits. The tax code is so complex that most Americans pay someone to do their taxes or they buy commercial software to help them file.

There is also widespread agreement that lawmakers should eliminate some targeted tax breaks and use the extra revenue to lower tax rates for everyone. However, there is no consensus on which tax breaks should go and whose tax rates should be cut.

The top federal income tax rate for individuals and families is 39.6 percent. Some Republicans in Congress would like to lower it to 25 percent.

“I don’t think lowering the top individual rate is the way to grow our economy or create a better future for middle-class workers or for the country at large,” Lew said.

Obama released a framework for business tax reform in 2012. In it, he called for lowering the top corporate income tax rate from 35 percent — the highest in the industrialized world — to 28 percent. Obama would finance the cut by eliminating dozens of targeted tax breaks for corporations.

The corporate income tax, however, only affects a small percentage of American businesses. More than 30 million tax returns a year report business income. But in 2013, only 2.2 million were traditional corporations that paid the corporate income tax.

The overwhelming majority were sole proprietorships, partnerships and other corporations in which the owners report their business income on their individual tax returns. These businesses, known as pass-throughs, would not benefit from a cut in the corporate income tax rate.

Lew said Obama’s plan would help these businesses in other ways, such as easing accounting rules and enabling them to more quickly write off business expenses.

Key Republicans in Congress, however, are skeptical that Obama’s proposals would do enough to help small businesses.

“Let’s start the discussion on businesses, but it’s difficult to follow that all the way through without having a real adult conversation about individual rates because so many of our businesses are filing over there,” said Rep Kevin Brady of Texas, a senior Republican on the Ways and Means Committee.

___

Follow Stephen Ohlemacher on Twitter: http://twitter.com/stephenatap

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Oakland Post: Week of January 1 – 7, 2025

The printed Weekly Edition of the Oakland Post: Week of January 1 – 7, 2025

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January 2, 2025

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2024 In Review: 7 Questions for the California Association of Black School Educators 

CABSE members represent governmental agencies, charter schools and charter school organizations, public school districts, traditional public schools, and community colleges. The organization’s primary goal is to expand PK-14 educational opportunities for all students in California, with an emphasis on under-represented and under-served Black students.

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CABSE members represent governmental agencies, charter schools and charter school organizations, public school districts, traditional public schools, and community colleges. The organization’s primary goal is to expand PK-14 educational opportunities for all students in California, with an emphasis on under-represented and under-served Black students.

CABSE President Satra Zurita and Conference Chair Micah Ali.

By Edward Henderson, California Black Media

The California Association of Black School Educators (CABSE) is an organization consisting of elected and appointed school officials, administrators and instructors from across California who are committed to advancing equity for Black students.

CABSE members represent governmental agencies, charter schools and charter school organizations, public school districts, traditional public schools, and community colleges.

The organization’s primary goal is to expand PK-14 educational opportunities for all students in California, with an emphasis on under-represented and under-served Black students.

California Black Media (CBM) spoke with CABSE President Satra Zurita and Conference Chair Micah Ali about this year’s successes, disappointments, and plans for the organization coming into the new year.

Looking back at 2024, what stands out to you as your most important achievement and why?

Ali: I would have to say that two highlights have been the ongoing support of the Bill and Melinda Gates Foundation, Engie, and other sponsors that have enabled us to bring together like-minded education leaders twice a year to collectively advance innovative and meaningful strategies to achieve change on behalf of Black students across our state.

How did your leadership and investments contribute to improving the lives of Black Californians? 

Zurita: CABSE’s leadership and investment in improving the education system for Black students in our great state has resulted in a long-standing focus on transforming public education and its response to Black students. By pulling from the very wisdom of those educators and leaders who care deeply about Black students and who are showing great promise through their efforts.

What frustrated you the most over the last year? 

Zurita: Continuing to see the deep impact of COVID-19 Pandemic school site closures on students academically and emotionally — especially Black students. This makes our work and our advocacy more vital than ever.

CBM: What inspired you the most over the last year?

Zurita: Seeing our CABSE convenings grow in depth and breadth — our strategies, powerful content and reach.

What is one lesson you learned in 2024 that will inform your decision-making next year?

Ali: Our Blueprint for Education Equity is a crowd-sourced framework of strategies that have shown great promise for improving the education experiences and opportunities for Black students. In 2024, we developed an equity self-assessment tool for districts to use in evaluating their own efforts on behalf of Black students. Strategies are helping Black students.

In one word, what is the biggest challenge Black Californians face?

Zurita: Many Black students across our state are dealing with a host of challenges: homelessness, food insecurity, exposure to violence, not to mention bias remains a pervasive problem. To add to the challenge, educators are worn out, tired, and frustrated. We now need to think about how we can simultaneously inspire and empower students and educators alike. The system needs an overhaul.

What is the goal you want to achieve most in 2025?

Zurita: In 2025, we hope to stand CABSE up as a fully functioning non-profit organization engaged in research and policy design.

Ali: We also aim to deepen the content of our convenings, including adding a Math Track and what we are calling Social Determinants of Education Track to our annual conference and institute, which will address those social contexts that prevent Black students from realizing their potential as students.

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Dr. Monica Soni. Courtesy of Covered California.

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Navigating health insurance can often feel overwhelming, especially for individuals and families who are new to the system or unsure about their options.

Health literacy is critical for achieving better outcomes, reducing disparities, and ensuring every African American and Black Californian — regardless of their income, ethnicity, or background — has access to quality care. By making health insurance simpler to understand, we empower individuals to access preventive services, manage chronic conditions, and avoid costly medical bills.

Breaking Barriers in African American and Black Communities
This year, “Let’s Talk Health” places a special focus on supporting African American and Black communities, where systemic inequities in health outcomes persist. These communities often face higher rates of chronic conditions and challenges in navigating the health care system. To address these disparities, Covered California partnered with trusted organizations to provide information, tips and resources.

In San Francisco, Andre Atkins, Director of Programs at Rafiki Coalition, led a dialogue with Dr. Kim Rhoads, Community Engagement Director at UCSF Helen Diller Family Comprehensive Cancer Center; Destiny Williams, Health and Wellness Program Manager at Rafiki Coalition; and myself.

These conversations play a vital role in the pursuit of health equity by sharing power and creating spaces where our community can learn, share experiences, ask questions and connect with advocates who work daily to understand their unique needs. Through these efforts, we reaffirm our dedication to fostering equity and inclusion in health care, ensuring that every voice is heard and supported.

Why Health Literacy Matters
Health literacy goes beyond understanding health care terms. It’s about empowerment. It equips individuals to make informed decisions, from choosing the right health plan to finding a provider to deliver preventive care and seeking mental health services. At Covered California, we provide tools and resources, such as side-by-side plan comparisons and financial assistance details, to ensure everyone can navigate their options confidently and access the care they need.

Taking the First Step
Whether you’re a student, part-time worker, family of four, open enrollment is your opportunity to prioritize your health and your future. This year’s open enrollment period runs from Nov. 1, 2024, to Jan. 31, 2025, and we’re here to assist you every step of the way.

Consumers must select a health plan by the Dec. 31 to receive coverage for the entire year, starting Jan. 1, 2025.

To find the plan that’s right for you, and take the first step toward a healthier tomorrow, visit CoveredCA.com and fill out the application yourself or put in your ZIP code and connect with a certified agent in your neighborhood who can guide you through your options. Together, we can break down barriers and ensure that all Californians have the tools to thrive.

Dr. Monica Soni, MD, is the Chief Medical Officer for Covered California, where she leads efforts in health equity, quality transformation, and clinical innovation. As a practicing board-certified internal medicine physician and health care leader with over a decade of experience, Dr. Soni is committed to improving affordability, access, and outcomes for all Californians.