On Tax Day, Congressman Cohen Supported Plan to Protect Taxpayers and Reinvest in America

Americans have already spent $45 billion rebuilding Iraq and the war costs our nation $10.3 billion a month, or about $4,000 a second. The typical American taxpayer’s entire federal tax bill pays for less than one half of one second of the cost of the war in Iraq. Additionally, the Defense Contract Audit Agency believes there have been more than $10 billion in questionable or unsupported costs in Iraq contracts.

“Taxpayers in the 9th District know that the tax dollars they’ve filed over the past weeks and months are being sent straight to Iraq,” said Congressman Cohen. “America has spent billions of dollars on the war in Iraq, while the people of Memphis and Shelby County have seen the value of their homes decline and the cost of food, gasoline and health care skyrocket out of control.”

Congressman Cohen added, “The money that we’ve spent on Iraq could’ve been used to give every American access to health care, end the mortgage crisis and cut our dependence on foreign oil, but instead we have become mired in the affairs of the Middle East with no end in sight. As I’ve said many times before, we need fewer troops on the ground in Baghdad and more police on the streets of Memphis. It’s time to invest in America again.”

In addition to continuing the fight for a new direction in Iraq, Congressman Cohen backed legislation yesterday that will help put the tax code back on the side of middle class families. The Taxpayer Assistance and Simplification Act passed the House last night by a vote of 238-179.

The bill takes action on behalf of America’s taxpayers. The legislation will stop taxpayer harassment by ending the private collection of federal taxes. Yesterday’s Washington Post reports that this practice costs the IRS $37 million more than it generates. The legislation also strengthens taxpayer protections from identity theft and tax fraud, simplifies cell phone tax reporting and expands tax help for low-income taxpayers.

The Taxpayer Assistance and Simplification Act also includes measures to make the tax code easier to use and understand. Currently, the tax code contains more than seven hundred provisions affecting individuals and more than fifteen hundred affecting businesses – a total of more than 1.4 million words. All told, tax laws are four times as long as the book War and Peace. The confusing tax code costs taxpayers more than $1 billion annually because taxpayers make the wrong decisions on tax forms. The bill passed last night strengthens IRS outreach and assistance efforts to help ensure taxpayers know they are entitled to tax refunds or to payments under the Earned Income Tax Credit.

The legislation also takes steps to close egregious corporate loopholes and stop federal contractors from using foreign subsidiaries to evade Social Security and other employment taxes. Currently, companies including KBR avoid paying their fair share of Social Security and Medicare taxes by creating shell companies in the Cayman Islands. The Taxpayer Assistance and Simplification closes this loophole, which costs American taxpayers almost $100 million a year.

“For too long, the tax code has given big businesses every advantage and left middle class families to fend for themselves,” added Congressman Cohen. “I was proud to back legislation that will make companies pay their fair share and help ensure taxpayers who play by the rules get the assistance they need and deserve.”

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Contact:
Marilyn Dillihay, Press Secretary, 202-225-3265
Charlie Gerber, Communications Assistant, 202-225-3265