Life insurers keep eye on tax panel and its recommendations.A federal commission examining fundamental changes to the U.S. tax code is very unlikely to scrap the income tax system in favor of a national sales tax sales tax, levy on the sale of goods or services, generally calculated as a percentage of the selling price, and sometimes called a purchase tax. It is usually collected in the form of an extra charge by the retailer, who remits the tax to the government. or a European-style value-added tax value-added tax (VAT), levy imposed on business at all levels of the manufacture and production of a good or service and based on the increase in price, or value, provided by each level. , the panel's vice chairman told the American Council of Life Insurers The American Council of Life Insurers (ACLI) is a Washington-based lobbying and trade group for the life insurance industry. ACLI represents 373 insurance companies that account for 93 percent of the U.S. life insurance industry's total assets. . But a trio of former U.S. Treasury U.S. Treasury Created in 1798, the United States Department of the Treasury is the government (Cabinet) department responsible for issuing all Treasury bonds, notes and bills. Some of the government branches operating under the U.S. Treasury umbrella include the IRS, U.S. Department tax officials noted that whatever changes the panel ultimately recommends could have tremendous consequences lot the life insurance industry. Addressing the general session of the ACLI's annual convention, former Louisiana Sen. John Breaux--who has served as vice chairman of the President's Advisory Panel on Federal Tax Reform since its inception in January--said the panel still is examining a number of proposals to craft a "fairer, simpler" tax code, but shifting to a sales or value-added tax wasn't likely to be among the recommendations. However, he noted the panel is in agreement on the need to scrap the Alternative Minimum Tax, and its charge to provide revenue neutrality creates a need for offsets. Several potentially contentious options remain on the table, including capping or repealing tax breaks for employer-provided health insurance, both as a deduction for the employer and as exempt income Exempt Income Certain types of income that are not subject to income tax. Notes: Examples of exempt income include: gifts under $10,000, death benefits, health benefits, and some scholarships. See also: Exemption for the employee. Other options the panel is mulling include significantly reducing the $1 million cap on mortgage interest deductions and eliminating federal deductions for state and local taxes, Breaux said. Originally expected around the end of July, the panel's report has been delayed, in part, by the failure of talks on Social Security reform and the fallout from hurricanes Katrina and Rita. Because of the scheduling, Treasury won't have time to include the findings in the department's budget, and the department probably won't release its own report until around the time of President Bush's next State of the Union address “State of the Union” redirects here. For other uses, see State of the Union (disambiguation). The State of the Union is an annual address in which the President of the United States reports on the status of the country, normally to a joint session of Congress (the . |
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