‘Super’ Focus on Jobs, Taxes

A s recently as the spring, most Washington observers didn’t expect federal tax reform to happen before the 2012 elections. But those predictions were made before Congress took the nation to within hours of defaulting on its debt, then struck a last-minute deal to raise the $14.3 trillion debt ceiling.

Part of that deal was the creation of a congressional “super committee” with a November deadline to recommend $1.5 trillion in spending cuts, tax changes and other deficit-reduction initiatives. If the committee can’t meet that goal or Congress doesn’t approve its recommendations, across-the-board cuts in spending would be triggered.

November is a tight timeframe in which to tackle a problem as big as the deficit, especially since the agreement tasks the committee with presenting specific legislative language and an official Congressional Budget Office estimate of the savings, not just broad outlines. Nonetheless, NRF is looking forward to working with this new panel, and hopes the deadline will jump-start a process that could otherwise take far too long.

NRF believes the super committee provides an important opportunity to look at a wide range of policies and reset our national priorities so we can put our nation’s economy back on track and get Americans back to work. That means a tax system that treats all players fairly instead of being riddled with special breaks, and it means re-examining rules and regulations that kill jobs.
NRF has urged the super committee to consider three key initiatives:

Corporate tax reform that would eliminate special tax breaks enjoyed by a handful of industries and reduce corporate rates for all industries. Retailers would pass most of the savings along to consumers through lower prices, and the resulting increase in demand for products would boost employment not just in retail, but among all industries that supply merchandise and services to retailers. A Value Added Tax or other consumption tax that would drive up prices should be rejected because of the massive job losses it would cause.

The Main Street Fairness Act, which would create a level playing field where all retailers would compete under the same sales tax rules. The legislation would help preserve local jobs by ending the unfair tax advantage online retailers have over struggling Main Street stores.

Relief from health care reform’s “employer mandate,” which will require most employers to provide government-mandated levels of health care coverage for their workers beginning in 2014. With businesses unable to raise prices to cover the increased payroll costs in the current economy, the requirement will force many companies to reduce the size of their workforces.

Tax reform still might not be enacted until after next year’s elections, but the super committee can get Congress focused not only on tax reform but on the broader picture of job creation and the economy.