Disagreement On Taxes
"Our disagreement with the president is not about closing loopholes," he said. "None of us are fond of loopholes. Our disagreement is over raising taxes on the very people that create jobs in our country."
Even those points of consensus may be less than they appear, said Buckley, now a visiting professor at Georgetown University Law Center in Washington. There are few, if any, special-interest loopholes large enough to drive significant reductions in individual and corporate tax rates.
Almost all of the estimated $1 trillion a year in tax breaks that could be curtailed to reduce rates have strong constituencies or economic justifications, and most survived the last tax-code rewrite in 1986. They include benefits such as the mortgage interest deduction, the exclusion of employer-provided health insurance, tax treatment of veterans' benefits and incentives for retirement savings.
'A Major Reduction'
"If you're going to have a major reduction in rate, you're not going to do that through carried interest or getting rid of the executive jet loophole," Buckley said. "This is what you're talking about."
Carried interest refers to the share of an investment partnership's profits that are treated as capital gains and taxed at 15 percent.
Senator Kent Conrad said yesterday that solving the country's tax and budget challenges will require lawmakers to shift some of their long-held positions.
"It just can't be so rigid," said Conrad, a North Dakota Democrat who heads the Senate Budget Committee. "You've got to actually focus on solving a problem rather than just being rigid."
To move a tax code overhaul forward, Archer said, the administration should advance a specific proposal, and Congress should engage in the details.