Sixth District Issues: Taxes

Both Glenn Grothman and Mark Harris agree on one thing -- the federal government has to start working to reduce the national debt and stop running budget deficits.

But how they get there -- and handle spending and taxes -- produces two significantly different paths.

Both Grothman, a current state senator, and Harris, the Winnebago County executive, have emphasized the potential crisis of the nation’s $17 trillion debt.

But for Harris, addressing it means saving enough during economic recoveries to pay down that debt over time. He cautions that the government should exercise fiscal restraint and hold back on cutting too deeply, saying sudden action could prompt another recession. Instead, Harris said government may want to reign in federal grants to other forms of government with more matching requirements and keeping restrains on earmarks in place.

Grothman singled out one program as a major driver of the federal deficit now and into the future: Obamacare.

“Not only has the [Affordable Care Act] pulled hundreds of billions in higher taxes out of our economy, it has slowed economic expansion, killed jobs and exploded federal spending on programs,” Grothman wrote in an emailed response. “The longer we ignore the damaging effects of Obamacare, the worse off we will be.”

Grothman, a former tax lawyer, has made his general position on federal taxes clear -- he believes the American public is overtaxed. He has signed a pledge with Americans for Tax Reform not to raise income tax rates for businesses or individuals and to oppose any cuts to tax credits or deductions unless they’re matched “dollar for dollar” with other tax cuts.

Grothman makes the case that corporate tax rates are the “highest among developed nations” and have put American businesses at a competitive disadvantage. As such, he wants to reduce the corporate tax rate and “simplify the tax code.”

“Our rates are especially shocking when looking at our neighbors in Canada who tax at 15 percent,” Grothman said in an emailed response. “We need to address broken tax policies that encourage companies to invest overseas and not at home.”

On corporate taxes, Harris admitted that the high end of the corporate tax bracket is the highest among developed nations, but said the average rate is “near the lowest” U.S. rate “in decades.” Harris suggested that a flat corporate tax of 20 percent could bring in about the same revenue while providing the United States with a competitive advantage over other developed countries.

When asked whether the income tax rates are appropriate and require any changes, Harris answered that any changes to the income tax system “cannot be piecemeal,” but did not specify what changes he would prefer if he were elected to Congress.

“If done piecemeal, Congress will not be able to resist making each change a tax cut that will undermine attempts to close the budget gap,” Harris said in an emailed response.

While Harris argues his record as Winnebago County executive includes holding the line on spending and debt with a small tax increase, he has not ruled out tax increases and has suggested raising the maximum taxable wage base for Social Security in order to keep the program sustainable.

“You could argue that raising the maximum tax base for Social Security is a tax increase,” Harris said in an interview. “But sometimes those things are the right thing to do and I think Social Security is an excellent program and it should be protected.”

When both candidates were asked if they would support raising the gas tax or other revenue generating measures to sustain the Highway Trust Fund, they both split their responses.

Harris emphasized that the nation’s transportation system needs a “dedicated source of funding.” While he didn’t explicitly advocate a hike in the gas tax he left it as one option, alongside transfers from other parts of the budget or increases in vehicle fees for hybrids or electric vehicles.

Grothman’s response was simpler: He would not support an increase in the gas tax. Instead, Grothman said the feds need to “reform how we build and maintain our roads and bridges to bring down the cost per mile” and increase revenue for the fund through economic growth.

Reach Jason Smathers at 920-453-5167

About this series

This is one in a series of stories about the 6th Congressional District race. All stories can be found online at sheboyganpress.com. The schedule of when stories have appeared or will appear in print follows:

• Wednesday, Oct. 15: Candidate profile, Democrat Mark Harris.

• Thursday, Oct. 16: Candidate profile, Republican Glenn Grothman.

Friday, Oct. 17: Candidate profile, Libertarian Gus Fahrendorf

• Monday, Oct. 20: 6th District issues, Taxes.

• Wednesday, Oct. 22: 6th District issues, Entitlements.

• Monday, Oct. 27: 6th District issues, Foreign Affairs.

• Wednesday, Oct. 29: 6th District issues, Health.