The House Budget Committee’s top Democrat is out with a new plan that he says will put more money back in the pockets of middle class Americans by transferring wealth from Wall Street and the country’s richest.
Rep. Chris Van Hollen, D-Md., revealed his “action plan” to help boost wages during a speech at the Center for American Progress in Washington, D.C., today. The crux of the proposal is tax breaks for the middle class—$2,000 per year for a couple making less than $200,000.
Over 10 years, the $1.2 trillion windfall would largely be paid for by a new fee imposed on financial transactions and a transfer of wealth from the country’s richest to those making less. Van Hollen proposed limiting tax breaks claimed by the top 1 percent of households.
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Also included in the Maryland Democrat’s “action plan” are provisions to help citizens build savings accounts and lessen the pay gap between the heads of corporations and their workers.
“It’s not just a question of economic fairness. It’s a question of economic growth,” Van Hollen said. “A pro-growth strategy is one that promotes broadly shared prosperity. Giving working Americans a larger share of the economic pie can make the entire pie grow faster.”
“It’s not just a question of economic fairness,” says @ChrisVanHollen. “It’s a question of economic growth.”
Van Hollen, who serves as the ranking member of the House Budget Committee, pointed to low gas prices and last month’s surging stock market as proof that the economy has bounced back in recent months. However, he noted that wages have remained stagnant since the 1970s, even as workers’ productivity grew.
“It’s no wonder that so many Americans are on a treadmill or falling behind,” the Maryland Democrat said.
With the GOP controlling the House and Senate for the first time in eight years, Republican lawmakers have made tax reform a top priority for the 114th Congress. However, Wisconsin Republican Rep. Paul Ryan, head of the House’s tax-writing committee, argued Van Hollen’s plan falls short of desired policy changes.
“Just as the sun rises in the east, Washington Democrats propose another massive tax increase,” Brendan Buck, Ryan’s spokesman, told Fox News.
Ryan took the helm of the Ways and Means Committee this year.
“Here in the House, our focus is going to be on cleaning up the tax code so that we can lower tax rates for all taxpayers and help create good-paying jobs, not scaring them off with punitive tax hikes,” Buck said.
Buck did not return The Daily Signal’s requests for comment.
Van Hollen told reporters today that the White House knows about his plan. However, it is not yet known whether President Obama supports the proposal.
Here’s the seven-point breakdown of Van Hollen’s “action plan.”
- Establish a “Paycheck Bonus Tax Credit” of $1,000 per year per worker or $2,000 per couple
- Help citizens build their savings with a $250 tax credit
- Pass the “CEO-Employee Paycheck Fairness Act” to lessen the pay gap between chief executive officers and their employees
- Provide tax breaks to businesses that invest in apprenticeships and training programs
- Introduce a “Second-Earner Tax Deduction” giving the second earner in a household a 20-percent tax break
- Raise the amount of expenses eligible under the Child and Dependent Care Tax Credit
- Implement a “high roller” fee on Wall Street transactions and curb tax breaks for the wealthiest 1 percent of households