• Although Democrats now seem to have vocally united as a party against the Alternative Minimum Tax’s (AMT) reach, it was this same party that, when it last controlled both the legislative and executive branches, passed a law to cast the AMT net even wider over the middle class.It never hurts to to remind ourselves just who has done what to tax policy. Democrats like to call themselves the party of the little guy, but the facts of their actions contradict that myth...
• Today, the AMT represents an excessive tax burden for millions of Americans, and one that will grow exponentially if it remains unchecked. In addition to affecting millions of middle-income taxpayers, even the original purpose of the AMT – to target the few who were avoiding tax liability – is frustrated.
• If further action is not taken, it is estimated that the AMT could claim 35 million families and individuals by the end of this decade.
• Changes enacted by Democrat majorities increased the AMT’s effect on taxpayers while several attempts by Republicans to repeal or alleviate its effects were opposed by most Democrats.
• In 1993, the last time that Democrats controlled the House, Senate, and Presidency, Congress raised the AMT rates and failed to index the exemption amounts for inflation.
o But for the 1993 increase and its failure to index for inflation, only 2.6 million tax filers would be subject to an AMT penalty next year rather than the projected 25 million under current law.
• Under Republican control, Congress passed The Taxpayer Relief Act of 1999, which contained a provision to repeal the AMT.
o With no Senate Democrats supporting it, the bill passed the Senate and Congress only to be later vetoed by President Clinton on September 23, 1999.
• During the recent Budget Resolution debate, three Republican amendments would have reduced or eliminated the impact of the AMT. However, only one Democrat Senator voted “yes” for just one of the three amendments relating to AMT.
• Despite their recent assertions expressing opposition to the AMT’s growing reach, the Democrats’ record on the AMT indicates a change in message. It is important to provide some perspective as to why the AMT developed into the menace it is today.
If you are interested in this sort of thing, be sure to read the whole thing. There are plenty of charts, graphs, footnotes, and quotes for even the most studious devotee of tax policy.
However, if your eyes glaze over at stuff like this; remember this bit from the conclusion:
Despite their recent assertions expressing opposition to the AMT’s growing reach, the Democrats’ record on the AMT indicates a change in message. Although they now claim to be in favor of alleviating the strain of the AMT, their actions and rhetoric in the 1990s belie that position, and that position was certainly not the case during votes on this year’s Budget Resolution. To address the serious problems presented by the AMT today, Congress needs to understand the history of how the AMT developed into the burden it is today, and then take serious steps to eradicate that menace once and for all.
