One of the provisions in the pending tax law undermines democracy as we know it!
Updated: Feb 2, 2019
My friend Jason N. Cadwell, CPA/PFS, CFP® writes:
The proposed tax law will allow private foundations (set up by an individual, a family or a group of individuals, for a purpose such as philanthropy or other legal economic objectives) to own 100% of an operating business, and though that business has no relationship to the charity’s purpose, the business would pay no income taxes. (Reference House H.R. 1, §5104 Senate JCT Mod. 11/14: III.B.13).
Of course, this will put tax-paying businesses at a competitive disadvantage, but more importantly, the proposed law would allow individuals and families the ability to create a funding vehicle for their pet projects.
Essentially, they will be able to set up shadow governments through the fiefdoms they create, then “assess” their own taxes, and dictate how those taxes will be used. How long would it take Congress to realize that the deluge let loose by Citizen’s United has dried up? Congress would become irrelevant.
Can you blame the powers behind this proposal? Why go through the waste and inefficiencies of pouring millions and billions into political campaigns to buy influence with unreliable politicians when you can have direct control over policy? Why pay retail when you can buy wholesale?
I see the Koch brothers’ fingerprints on this provision, but I don’t care if the instigators are on the right or the left. I have no interest in turning over the function of government to a cadre of elites like some real life Game of Thrones.
If you feel likewise, please, contact your Senators and Congresspersons and tell them to stop the bill in reconciliation.