Fact Sheet: The "Mother of All Distortions": Attacks on Rangel AMT Plan Not Based On Reality

Publication Date: February 2008

Publisher: Center on Budget and Policy Priorities (Washington, D.C.)

Author(s): Aviva Aron-Dine

Research Area: Banking and finance

Type: Report

Abstract:

Republican congressional leaders have sharply attacked House Ways and Means Chairman Rangel’s proposal to replace the Alternative Minimum Tax with a tax surcharge for very-high-income households as a massive tax increase that would seriously damage, even “doom,” the economy.  In fact, however, the Rangel plan is not a tax increase.  Moreover, it would create a tax system that is simpler, more progressive, and likely better for the economy than either current law or the idea favored by many of the plan’s critics:  eliminating the AMT without paying for it.